[Wluwsdtn]

Coming next ...the 8p-a-month mortgage



By Mail On Sunday Reporter

Last updated at 9:29 AM on 01st February 2009

• Comments (29)
  
• Add to My Stories
  

Thousands of people are set to pay as little as 8 pence a month for their mortgages




Thousands of people are set to pay as little as eight pence a month for their mortgages if the Bank of England cuts interest rates to a record low of one per cent next week.



They include those who took out interest-only loans with the Cheltenham & Gloucester in 2007 at 1.01 per cent below the base rate – in theory meaning they should be charging the bank for their mortgage.





C&G has said its computers cannot deal with zero or negative rates and 0.001 per cent will be charged ‘until the computer systems can be adjusted’.



On a £100,000 interest-only mortgage, this equates to eight pence a month. But C&G has promised to refund these few pence once its system is fixed.



Hundreds of thousands of borrowers, including those with the Halifax – the biggest mortgage lender – will also see payments drop to a few pounds, pence, or even nothing. But some lenders have ‘collars’ to limit how far rates fall.



Lenders insist that they will never be in the position of paying borrowers interest, even if rates become negative.





C&G said: ‘Our terms and conditions make it clear that interest is only paid by the borrower and not the lender.’



But mortgage experts claim that borrowers could be legally entitled to cash.



There is a growing gulf between borrowers on a fixed rate and those whose rates follow the base rate.





Fixed rates and rates for new mortgages have remained high.





Borrowers paying six per cent on an interest-only mortgage of £150,000 face monthly bills of £750.

[Mowselelew]

Coming next ...the 8p-a-month mortgage



By Mail On Sunday Reporter

Last updated at 9:29 AM on 01st February 2009

• Comments (29)
  
• Add to My Stories
  

Thousands of people are set to pay as little as 8 pence a month for their mortgages




Thousands of people are set to pay as little as eight pence a month for their mortgages if the Bank of England cuts interest rates to a record low of one per cent next week.



They include those who took out interest-only loans with the Cheltenham & Gloucester in 2007 at 1.01 per cent below the base rate – in theory meaning they should be charging the bank for their mortgage.





C&G has said its computers cannot deal with zero or negative rates and 0.001 per cent will be charged ‘until the computer systems can be adjusted’.



On a £100,000 interest-only mortgage, this equates to eight pence a month. But C&G has promised to refund these few pence once its system is fixed.



Hundreds of thousands of borrowers, including those with the Halifax – the biggest mortgage lender – will also see payments drop to a few pounds, pence, or even nothing. But some lenders have ‘collars’ to limit how far rates fall.



Lenders insist that they will never be in the position of paying borrowers interest, even if rates become negative.





C&G said: ‘Our terms and conditions make it clear that interest is only paid by the borrower and not the lender.’



But mortgage experts claim that borrowers could be legally entitled to cash.



There is a growing gulf between borrowers on a fixed rate and those whose rates follow the base rate.





Fixed rates and rates for new mortgages have remained high.





Borrowers paying six per cent on an interest-only mortgage of £150,000 face monthly bills of £750.

This is serious. It is exactly like the Japanese strategy after their property bubble burst. Basically, with falling GBP and banks not willing to foreclose, we may be looking at a recession as long as Japan's !

[Wluwsdtn]

what for like this? make house prices go to zero loh. fre free housing for everyone

[Janny2006]

Where got free? nothing free in life