Interest-only mortgages expiring

moneyistooshorttomention

Miss_Samantha wrote: »

We don't have a landmass problem. There are huge space available.

You'll be the first one in line to live in a house in an area that most people wouldn't want then - eg slap bang on a boggy bit of land or at the top of a mountain will you?

Also giving up eating any food that takes land to produce (that'll be anything other than fish then)?

Presumably happy also with only seeing countryside for recreational purposes on videos of "how things used to be"? But unable to walk on it - as it's all been built on...

AdrianC

moneyistooshorttomention wrote: »

You'll be the first one in line to live in a house in an area that most people wouldn't want then - eg slap bang on a boggy bit of land or at the top of a mountain will you?

Also giving up eating any food that takes land to produce (that'll be anything other than fish then)?

Presumably happy also with only seeing countryside for recreational purposes on videos of "how things used to be"? But unable to walk on it - as it's all been built on...

<points back up to post 26>

quotememiserable

leveller2911 wrote: »

That said it does show the imbalance with UK housing when the only way many people can afford to buy is by having a 40yr mortage.

Let's hope we never see this. It will mean buyers can afford to pay more, leading to another big chunk of house price inflation, and people will soon be back not being able to afford them again. Then we'll talk of 60 year mortgages.
Making more money available doesn't fix the fact that demand outstrips supply.

marksoton

Apodemus wrote: »

Not entirely.

Roads on new developments are built by developers to a specification agreed with the local authority. Developers will want to minimise the scale of expense on roads and it is in their interest to minimise traffic-flow projections and other specifications. They are able to throw cash at expert reports that are difficult for a Council to refute, without being seen as unreasonably delaying occupation of much-needed homes.

For new developments, new schools (or expansion of existing schools) are partly paid for by developer contributions. Again there is a process of negotiation and a test of "reasonableness", which may not go in the local authority's favour. Even if a development makes a reasonable contribution to new school provision, it is very unusual for this to cover the total costs of construction/expansion, so the balance needs to be met from the Council's capital - in competition with a range of other much-needed projects.

Indeed, each party will do cost base analysis.

This process also includes utility companies. Even though in most cases they have a statutory requirement to provide infrastructure (e.g sewer rising mains ) they'll still negotiate cost carve up.

The council recoup initial costs through increased council tax revenue in the long term.

The utility companies through increased outputs.

The developer, well that's obvious.

MABLE

AdrianC wrote: »

Anybody hear MoneyBox on R4 this lunchtime?
http://www.bbc.co.uk/programmes/b080mhd6#playt=0h00m50s (9min 50)

Christine from Liverpool, who seemed very surprised that her interest-only mortgage would actually expire, and now faces repossession, since she can't repay it.
<boggle>

I listened to the programme and hopefully a satisfactory resolution can be reached for both parties. As harsh as it may seem I have little sympathy for the lady in question. If she did not understand what an interest mortgage entailed she could have easily made enquiries. Also it clearly stated on the reverse side of her statement the implications of having an interest free mortgage.

TrickyDicky101

I just listened to it and I am amazed how ignorant the woman was. She only has herself to blame. I think the bank is entirely blameless in this particular situation.

Thrugelmir

MABLE wrote: »

I listened to the programme and hopefully a satisfactory resolution can be reached for both parties. As harsh as it may seem I have little sympathy for the lady in question. If she did not understand what an interest mortgage entailed she could have easily made enquiries. Also it clearly stated on the reverse side of her statement the implications of having an interest free mortgage.

The lady's attitude came across as is was lenders responsibility to find a solution. Yet it was her decision to invest in a foreign property. Little was said about this. One suspects there's far more to this part of the story.

I also noted that she had been advised to consult Step Change. Again suggests that the reason she hasn't paid down any capital is also related to other financial factors.

All of which makes the article lacking in my opinion. Something Money Box falls into the trap of doing quite often. Resulting in a misleading slant.

We need to move back to a culture of taking personal responsibility for our own financial decisions and money management. Why should people pick up the tab for others misjudgement and decisions.

moneyistooshorttomention

AdrianC wrote: »

<points back up to post 26>

I think that rather proves my point - everyone and their dog wants to be in Southern England.

Hence one quick way to "put up the backs" of some of us (ie those of us that are from Southern England and are/were on the receiving end of this).

But on topic of being surprised this woman hasnt thought of the fact that interest-free mortgages need the capital repaying at some point - and I do actually sympathise (if not agree!) in a sense. If one thinks "Oh well - 25 year mortgage term and, by then, the capital owed will have gone down a lot in real terms and my income will have gone up a lot in real terms" then it is understandable - even if one doesnt agree with it.

What she didnt take account of is that ways of thinking/planning have to alter at times (darn it) in accordance with what Society as a whole has going on. These days - one can't rely on Society as a whole "downing" that capital and "upping" that income. Things have changed rather.

After all - lots of people (including some I know personally) took out mortgages at much the same time as I took mine out donkeys years back and they got endowment mortgages and have suffered the consequences since. Colour me cynical - but I could "see that one coming" and had duly taken out a repayment mortgage. But, if one hasn't basically learnt to have a more cynical temperament over the years - then I can understand how someone could end up in that position (even though I personally would have run a mile at the thought of that type of mortgage too).

adindas

Thrugelmir wrote: »

The lady's attitude came across as is was lenders responsibility to find a solution. Yet it was her decision to invest in a foreign property. Little was said about this. One suspects there's far more to this part of the story.

I also noted that she had been advised to consult Step Change. Again suggests that the reason she hasn't paid down any capital is also related to other financial factors.

All of which makes the article lacking in my opinion. Something Money Box falls into the trap of doing quite often. Resulting in a misleading slant.

We need to move back to a culture of taking personal responsibility for our own financial decisions and money management. Why should people pick up the tab for others misjudgement and decisions.

We see this sort of things often on MSE especially about taking loan. People fall in debt because of spending more than they could efforts, gambling, etc.

Few are even trying pushing responsibility to their own children ...
Unbelievable how people could use various excuses, blatantly lie even noone will ever believe it.

The chance that this lady does not know what entail an interest free mortgage are next to none. How come she did not know while capable of signing a few mortgages, having few properties including the one abroad.

Next time people could say, I am not aware that if I do not pay my mortgage, my house will be repossessed. And if it the duty of lender to prove that I am not lying.

Thrugelmir

adindas wrote: »

Next time people could say, I am not aware that if I do not pay my mortgage, my house will be repossessed. And if it the duty of lender to prove that I am not lying.

What the programme totally omitted and is a material fact. Is that from May 2013 the FCA has requested lenders to write to borrowers to remind them that the mortgage debt needs to be repaid and ask what their proposed repayment method is. As the lender in this instance was Santander. This lady has received at least one letter, and if she made no response to the enquiry made, further letters. This lady wasn't entirely truthful or the programmes editors intentionally left this out of the article. Guess we'll never know the answer.