Two banks to offer interest only mortgages again

shortchanged_2

OffGridLiving wrote: »

I looked at IO mortgages with other lenders and the amount of hoops I would have to jump through with providing pensions forecasts, ISA returns and other details that I just decided to give up and go with repayment.

It's odd that I wasn't offered anything with Santander, all I can think is that they didn't offer your deal to existing customers, or the deal wasn't available when I was looking in May?

Well done though for getting 5 more years on IO. By the time that period expires we'll hopefully have returned to sensible lending practices where minimum wage 20 something kids at call centres don't try lecturing wealthy 40 something adults on how to manage their money.

You never really told us if you hit your 50% mortgage equity challenge.

So did you?

Sibley

Turnbull2000 wrote: »

Give it another 12-18 months, and other lenders will begin offering proper interest only mortgages in order to compete. By 2015, 100% mortgages should be back too, as lenders seek to offer 'innovative' mortgage products in a battle for customers desperate to buy as government initiatives continue to pump up the market.

A few bears on here sneared at me for predicting double digit UK HPI for 2013-2013 year-on-year. Do they still believe I'm wrong?

Same here.

I said house prices would be flying and banks fighting to lend money.

Remember all the HPC gang giving me stick?

They don't like it. They come out with all clever comments and reasons why prices will drop but they are mistaken.

Right from the start. I always said homeowners and the government would never allow prices to fall. :rotfl:

HAMISH_MCTAVISH

Sibley wrote: »

They don't like it.

They most certainly "don't like it up em" one bit.

Of course I'm finding their current state of borderline panic and endless distraught "bears in despair" caterwauling to be most entertaining.

It must be particularly galling for them to know that not only were they catastrophically, devastatingly, appallingly wrong....

They were outwitted by Sibley.

Loughton_Monkey

Sibley wrote: »

.....Right from the start. I always said homeowners ....... would never allow prices to fall. :rotfl:

How right you are!

I know fairly accurately what my house was worth mid 2007.

I then sat and watched the most miserable 'correction' of about 20% down - across the country - in 18 months. But being the sort of homeowner to which you allude, I doggedly and utterly refused to drop the price of my own home by a single penny!

All I can say is thank God I didn't need to sell it or put it on the market.....

OffGridLiving

shortchanged wrote: »

You never really told us if you hit your 50% mortgage equity challenge.

So did you?

I remortgaged in May and my house was valued at £430k and my mortgage was £240k. I therefore have 44% equity, which was enough to get the fixed rate deal I wanted that was pitched at 60%LTV.

There are very few mortgage products that require more than 60% LTV, but it has been reported for a long time that valuers are undervaluing houses in order to mitigate risk for the lenders. It's therefore a smart move to give yourself some 'wriggle room', when making overpayments to achieve a particular LTV banding, and aim for an even higher band.

I have always been of the opinion that it's much better to set yourself tough personal targets in life than easy ones. Better to slightly undershoot a high target than to achieve a low one, don't you think?

Hmnn, actually, I don't think you do.

chucky

OffGridLiving wrote: »

I have always been of the opinion that it's much better to set yourself tough personal targets in life than easy ones. Better to slightly undershoot a high target than to achieve a low one, don't you think?

Hmnn, actually, I don't think you do.

That's great news. Interestingly, if you hadn't met your 50% target it's would have amused/pleased Shortlegs that you hadn't met it which goes against his desire of wanting people to pay down their debt. Schadenfreude and hypocrisy are very common on this forum.

OffGridLiving

chucky wrote: »

That's great news. Interestingly if you hadn't met your 50% target it's would have amused/pleased Shortlegs that you hadn't met it which goes against his desire of wanting people to pay down their debt. Schadenfreude and hypocrisy are very common on this forum.

Old shorty is having a bad time of it these days because all of his 'mock props' are being kicked over.

1. He used to mock me for gambling on low interest rates and buying a dream/expensive home. I was proved right and interest rates stayed low for the duration of my mortgage deal (3 years).

2. He used to mock me for having a 5x salary mortgage loan. I overpaid the loan and got a better paid job and that mortgage is now 3.5 x salary.

3. He used to mock me for having an Interest Only mortgage. I paid down more of the mortgage on IO with overpayments than I would have done with a repayment mortgage. I am now on a repayment mortgage.

4. He used to mock me (in advance) for being in financial trouble when interest rates rise. As expected, they didn't rise and I reduced my risk with overpayments. I have now eliminated that risk with a 5 year fee free fixed rate at 2.79%.

5. He used to mock me that I would not hit my 50% LTV challenge. I didn't need to hit that, I needed to hit 60% LTV but set the bar higher and managed to achieve 56% LTV. I over-achieved and got the mortgage I wanted, with room to spare.

As all of his 'mock props' have been kicked away, I am interested to see if he comes up with any new ones. I doubt it.

chucky

OffGridLiving wrote: »

As all of his 'mock props' have been kicked away, I am interested to see if he comes up with any new ones. I doubt it.

I've noticed that his obsession with the current oil price causing recession has stopped. He must stop reading those random blogs on the Internet.

OffGridLiving

chucky wrote: »

I've noticed that his obsession with the current oil price causing recession has stopped. He must stop reading those random blogs on the Internet.

He's pretty much a 'one trick pony'. Now that Interest Only mortgages have been withdrawn by mainstream lenders, he hasn't anything to post about. I reckon he's lobbying government to have IO reintroduced just so he has a 'cause' to moan about.

Graham_Devon

Interestingly, Clydesdale Bank had it's credit rating downgraded last night due to it's lending position.

Not one notch, but 3, to Baa2

It's now deemed a "significantly higher risk investment" leaving it in an uncertain position.

Apparently the bank is saddled with bad debt on high risk commercial property loans.