Mortgage Loans hit negative equity status
11/06/08
Latest loan news for homeowners shows that the mortgage loan market has left many homeowners in negative equity status. The data from Citigroup suggests that 250,000 people are now in this unfortunate situation.
The ongoing impact on the housing market has led to recurring house price falls, therefore resulting in many homeowners facing negative equity which means that homeowners owe more than what their properties are worth.
It is thought that as many as around one million home owners could face negative equity by the end of next year that is in 2009 according to the Bank’s chief economist, Michael Saunders. These figures are forecasted if the prices of houses fall by as much as fifteen per cent which is what is predicted.
It seems as though this gloomy situation is due to stay. The Bank of England has cut the base rate three times in recent months and with no signs of further cuts this month along with inflation on the up this could cause problems to many homeowners with mortgage loans.
This slowdown in the UK economy seems to have hit borrowers hard. With mortgage loans on the increase as well as a rise in many bills and a number of consumable items, expenses are certainly on the rise for many people.
