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:tinysmile_cry_t:
Bear with me here as I may not make sense - no change there then!
A few months ago when watching programme ref the american sub prime lending they were showing rows of empty houses that had been practically destroyed as the owners had been evicted and at the time I kept thinking - how short sighted. The banks were never going to get their money back as the houses had been ruined and all the people had gone. And yet all those people had managed the payments before the rates increased and then would have had to find housing elsewhere. So I could not understand why the banks in some ways did not become landlords as at least they would over the years got their money back and they would have had assetts on their books.
I am not saying that people in arrears should be let off what they owe but in the present crisis surely there is some way the banks and BS can think outside the box.
For example say a bank have loaned 100000 on a 100% loan
now the house is worth 80000 and because of the increase in rates the owners can not afford the MP .If they take back the house and sell it it would be worth even less maybe £70000 because empty etc. They probably also dont have a hope in hell of getting back the balance of £30000 over the next 12 years as the occupants have to pay rent etc and have no spare funds.
If the bank took the house back but became landlords and took rent in from the occupants they would at least be getting an income and the house would be looked after. Over the years they would get the 100000 back and have an increasing asset.
Now I know in theory this looks like a bad deal all round and why should the borrowers be "let off" But they would not be houseowners any more and not have an asset. Maybe also in the rent there could be an element of repaying the £20000 shortfall at the time of giving the house up.
Well thats where I am not sure of the answers and I know each case has particular circumstances and in the event of illness etc even a "rent payment" would not be possible.
Maybe it is impossible - or maybe this is already being suggested elsewhere.
Or could there just be a standard ( appying to all mortgages) clause where you are allowed so many months of the mortgage being frozen for say 6months if you are suffering extreme hardship.
If not I am still I think going back to my argument that there should be some sort of independant PPI scheme which is compulsory for all mortgages ( and I am talkg about an aproved scheme - not a rip off scheme - If you did not take this out you would have to prove alternative cover for illness unemployment and maybe even divorce etc .And sign a very clear ethat you realise the consequences of not taking out the insurance,
I believe they run a scheme like this in other countries.
sorry if this does not make sense - but when these things come into my head I have to write them down!
Bear with me here as I may not make sense - no change there then!
A few months ago when watching programme ref the american sub prime lending they were showing rows of empty houses that had been practically destroyed as the owners had been evicted and at the time I kept thinking - how short sighted. The banks were never going to get their money back as the houses had been ruined and all the people had gone. And yet all those people had managed the payments before the rates increased and then would have had to find housing elsewhere. So I could not understand why the banks in some ways did not become landlords as at least they would over the years got their money back and they would have had assetts on their books.
I am not saying that people in arrears should be let off what they owe but in the present crisis surely there is some way the banks and BS can think outside the box.
For example say a bank have loaned 100000 on a 100% loan
now the house is worth 80000 and because of the increase in rates the owners can not afford the MP .If they take back the house and sell it it would be worth even less maybe £70000 because empty etc. They probably also dont have a hope in hell of getting back the balance of £30000 over the next 12 years as the occupants have to pay rent etc and have no spare funds.
If the bank took the house back but became landlords and took rent in from the occupants they would at least be getting an income and the house would be looked after. Over the years they would get the 100000 back and have an increasing asset.
Now I know in theory this looks like a bad deal all round and why should the borrowers be "let off" But they would not be houseowners any more and not have an asset. Maybe also in the rent there could be an element of repaying the £20000 shortfall at the time of giving the house up.
Well thats where I am not sure of the answers and I know each case has particular circumstances and in the event of illness etc even a "rent payment" would not be possible.
Maybe it is impossible - or maybe this is already being suggested elsewhere.
Or could there just be a standard ( appying to all mortgages) clause where you are allowed so many months of the mortgage being frozen for say 6months if you are suffering extreme hardship.
If not I am still I think going back to my argument that there should be some sort of independant PPI scheme which is compulsory for all mortgages ( and I am talkg about an aproved scheme - not a rip off scheme - If you did not take this out you would have to prove alternative cover for illness unemployment and maybe even divorce etc .And sign a very clear ethat you realise the consequences of not taking out the insurance,
I believe they run a scheme like this in other countries.
sorry if this does not make sense - but when these things come into my head I have to write them down!
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