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Home Owners => Mortgages and Insurance => Topic started by: The Prophet on February 11, 2013, 10:19:36 am

Title: Interest-only mortgage 'time-bomb zombies'
Post by: The Prophet on February 11, 2013, 10:19:36 am
There are around one million households with an interest only mortgages totalling £120billion.
Around 70% of these have no investment plan to repay the loan at the end of the term. 
Whilst a further 40% that do have a plan, will be unable to fully re pay their loan.
Only 31% of investments are on track to fully repay the loan.

Another group known as 'zombie households' are borrowers who are barely able to keep financially afloat now, when mortgage interest rates are their lowest for 300 years. Around one million borrowers would be in trouble if (or more likely when) interest rates return to their normal mean average.

Just under 20% of all homes purchased are with an interest-only mortgage.