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News Tag: negative equity

October 30, 2012

100,000 mortgage holders escape negative equity trap

by Jan Harris
100,000 mortgage holders escape negative equity trap
New figures from the Council of Mortgage Lenders (CML) reveal that the number of borrowers in negative equity fell 13 per cent to 719,000 between the first quarter of 2011 and the first quarter of 2012. The number of borrowers paying a mortgage greater than the value of their property fell despite a further small decline in house prices. Although property ...




May 4, 2012

Co-operative Bank ends interest-only mortgages

by Jan Harris
Co-operative Bank ends interest-only mortgages
The Co-operative Bank will stop offering interest-only mortgages from next Tuesday, but the decision will not affect existing customers. A recent report by the Independent on Sunday suggested that a quarter of a million people with interest-only mortgages will reach retirement age by the end of the decade with a substantial capital debt still to pay. Customers on interest-only mortgages only pay the ...




December 15, 2011

New rules may ease negative equity problems

by Jan Harris
New rules may ease negative equity problems
The FSA's report into lending, due to be published next week, is expected to include proposals to help home owners in negative equity. The Council of Mortgage Lenders estimates that one in 12 homeowners are in negative equity, with their home now worth less than the price they paid for it, making it impossible for them to move house. This ...




August 9, 2011

More than 800,000 stuck in negative equity

by Kay Mitchell
”More
A report by the Council of Mortgage Lenders (CML) has revealed 827,000 mortgage borrowers are in negative equity (a mortgage worth more than their property). However, the figures which relate to the first quarter of the year, are not as bad as they were in the early 1990s, when around 1.6 million households were trapped in negative equity. CML director general, Paul ...




August 31, 2010

Tens of thousands trapped in negative equity until 2014

by Gill Montia
”Tens
Tens of thousands of homeowners who bought during the housing boom face another four years of being trapped in negative equity. According to a new forecast from the National Housing Federation (NHF), those who purchased a property in England at the peak of the market in 2007 paid an average price of £216,800. They may therefore have to wait ...




December 14, 2009

Household disposable incomes tumble by £100pm

by Gill Montia
Household disposable incomes tumble by £100pm
The Bank of England's quarterly report covering the autumn of 2009 shows householders' disposable incomes after tax, housing costs, loan payments and utility bills having fallen by an average £100 per month over the past year. Manual workers, many of whom have been hit by reduced working hours, saw their disposable incomes depleted by between £50 and £100 a month, while non-manual ...




August 3, 2009

“Substantial” house price falls this year and next

by Gill Montia
”"Substantial"
The National Housing Federation (NHF) has produced an alarming forecast for the housing market in England. The body, which represents not-for-profit housing associations, is predicting "substantial" price falls in 2009 and 2010 followed by a rise of 20% by 2014. According to research undertaken by Oxford Economics for NHF, house prices in England will fall by 12.2% this year and ...




July 9, 2009

Nationwide offers 125% mortgage

by Gill Montia
”Nationwide
In a surprise move, Nationwide Building Society is offering a new mortgage with a loan-to-value (LTV) ratio of 125%. The deal is only available to existing customers who are in negative equity and need to move house. Even then borrowers will be selected very carefully. The building society says it can provide a loan for 95% of the value of a new home at a ...




July 1, 2009

Mortgage Rescue Scheme saves six homes

by David Masters
Mortgage Rescue Scheme saves six homes
Only six families have been helped by the government's Mortgage Rescue Scheme, housing minister John Healey admitted yesterday. Set up in January, the £200 million initiative aims to help vulnerable families at risk of having their home repossessed. Participants in the scheme can choose to have their home bought by the local authorities then rented back to them, or to take out a ...




June 24, 2009

Negative equity afflicts “prime” homeowners

by Gill Montia
”Negative
Northern Rock is leading the field in "prime" mortgages that have fallen into negative equity. A new report from ratings agency, Fitch, reveals that almost one in six households at the upper end of the UK property market have home loans that exceed the value of their properties. In the case of the state-owned Northern Rock, 32% of its Granite prime-loan book is in ...




June 12, 2009

Up to 11% of UK households in negative equity

by Gill Montia
”Up
In its latest Quarterly Bulletin, the Bank of England estimates that between 700,000 and 1.1 million UK homeowners are in negative equity. Negative equity occurs when the market value of a house is below the outstanding mortgage. With house prices falling by around 20% between autumn 2007 and spring 2009, the Bank estimates that between 7% and 11% of UK ...




April 20, 2009

Government housing adviser defends 100% mortgages

by Gill Montia
Government housing adviser defends 100% mortgages
A member of the Bank of England's Monetary Policy Committee has taken up the cause of would-be homeowners who need to borrow 100% of the value of a home. Kate Barker, who is also a Government adviser on the UK housing market, has publicly opposed Prime Minister Gordon Brown in his suggestion that such loans may be banned. High loan-to-value mortgages have played ...




April 17, 2009

CML estimate puts 900,000 in negative equity

by Gill Montia
CML estimate puts 900,000 in negative equity
The Council of Mortgage Lenders (CML) has published new research on negative equity in the UK housing market. The Council points out that during the 1993 market downturn, 1.5 million households or more were estimated to be in negative equity. Most eventually recovered their positions and a similar outcome is expected for today's homeowners with mortgages larger than the value of their ...




March 20, 2009

FSA warns 2.5m could face negative equity

by Gill Montia
FSA warns 2.5m could face negative equity
The Financial Services Authority (FSA) has warned that if during this year house prices complete a 30% fall from their 2007 peak, around 2.5 million mortgage borrowers could end up in negative equity. Around 500,000 of the total would be buy-to-let investors and the remainder homeowners. Such an outcome would leave one in four mortgaged households and half of buy-to-let borrowers with ...




February 27, 2009

Negative equity haunts four million homeowners

by Gill Montia
Negative equity haunts four million homeowners
Research involving 60,000 UK homeowners has led to claims that almost four million households are already in, or close to, negative equity. In terms of UK mortgage holders, the figure equates to one in three, which is double the number seen during the housing market downturn of the 1990s. Research firm, GfK NOP, found that homeowners aged between 25 and 34 who have ...




February 11, 2009

One in five homeowners face negative equity

by David Masters
One in five homeowners face negative equity
One in five homeowners could find themselves in negative equity as the recession tightens its stranglehold, the Financial Services Authority (FSA) has warned. House prices could potentially drop by as much as 30% compared to 2007 levels, the FSA said, leaving 2.5 million mortgage holders owing more than the value of their house. This is around 21% of people with ...




January 30, 2009

Millions in negative equity

by David Masters
Millions in negative equity
The worst housing market crash since records began has left an estimated 1.2 million households in negative equity, according to Nationwide Building Society. The average house price has dropped from £186,050 at peak in October 2007 to £150,500 today, a fall of over £35,000. This month alone, prices fell 1.3%, or £2,500. At current house prices, anyone who bought their home since 2003 paid more than ...




January 22, 2009

FSA reports rise in repossessions and arrears

by Gill Montia
FSA reports rise in repossessions and arrears
The Financial Services Authority (FSA) has reported that the number of home repossessions in the UK rose to 13,161 in the third quarter of 2008. The figure had increased from 11,054 during the second quarter of last year and was up 92% on the same period of 2007. In addition, the regulator found that the number of households with mortgage arrears rose ...




October 20, 2008

60,000 homeowners a month enter negative equity

by Gill Montia
60,000 homeowners a month enter negative equity
The downturn in the property market is forcing 60,000 homeowners a month into negative equity. According to the credit rating agency, Standard & Poor's, research suggests that 335,000 homes will be worth less than their mortgages by the end of October, a rise of 260,000 over four months. If the trend continues, the number of homes with mortgages above their value ...




August 5, 2008

Negative equity haunts one in five Northern Rock borrowers

by Gill Montia
Negative equity haunts one in five Northern Rock borrowers
As the housing market downturn continues, Northern Rock customers are more likely to be facing negative equity than borrowers with other UK lenders. While the number of people in arrears with their mortgage repayments is rising across the banking sector, Northern Rock is more exposed than most of its competitors because prior to the credit crisis, it offered home ...