February 23, 2008

Too funny - failed (and now nationalized) UK bank Northern Rock FINALLY pulls its 125% loan-to-value really-bad-idea mortgage


Want a house worth $500,000? Northern Rock would loan you $625,000. Party time!!!

Then, of course, you simply default, and enjoy the proceeds! Meanwhile, the UK taxpayer is fuc*ed.

Please tell me one day that they'll put the bankers who did this in jail.

Northern Rock pulls plug on 125% mortgages

In an effort to limit its risky lending, Northern Rock yesterday pulled its Together mortgage range, which offered a loan to value (LTV) of up to 125 per cent.

The range, launched nine years ago, proved popular with first-time buyers as it allowed them to combine a mortgage and personal loan to borrow more than the amount their property was valued at.

13 comments:

Anonymous said...

Why does it bother you Keith that some people borrowed and then spent that money away and then have no intention of paying it back? Hey, it's the American way. And the world will continue to lend their money to us so we can expand the world economy. Without the American consumer the world would be in big trouble.

joe frm chi said...

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u will need that in Chicago. if u want a SFR u will need 30-50k to make it livable!

a good good safe 'hood (u kno the kind that Obama lives in) will run u about 400 to 500k just for the RIGHT to buy.

too bad the avg *family* income here makes 46k! Michelle Obama makes 3x that no problem and then sends her kidz to The Lab School (for free I'm sure--PURE speculation *I'm sure!!!!!*).

Afterthought said...

What the hell is wrong with the British people?

They have no balls!

Their government is worse than ours. after all didn't they ALREADY go down the tubes as an Empire?

We are only just beginning our slide... so that gives us one up on them.

Racism is wrong, by the way; and the irony is that Obama is only half-black, and his black father is a PhD in Econ (think Math).

I get a kick at all the white trash who think they are better than Obama. I guess it feels better when you can discharge your self-hate onto someone else.

Russ DoGG said...

It's time for some Frog MArches and Perp Walks!


http://en.wikipedia.org/wiki/Frog-march

http://en.wikipedia.org/wiki/Perp_walk

SeattleMoose said...

It almost appears that the Pound and Dollar were engineered for collapse in order to give way to a single currency replacement.....nah, nobody would want that. Right?

Veronica Lodge said...

RE: Northern Rock's 125% mortgage and personal loan combo.

They must have gotten this idea from automobile manufacturers.

With good credit, GMAC will write a 125% car loan. This allows a customer to add stereo equipment, tires and wheels, lowering kits, pickup tops etc. to the loan.

There are also various rebates and other incentives.

However, I don't think that it is possible to get cash back at closing on a car deal. This must be a special real estate-only provision.

V.L.

Anonymous said...

I have to say that DOPES! was right. Since the Dunkin Donut community is doing nothng to stop the fraud, and these stupid loans exist(ed), I feel like a complete fool for not looting the system like so many others.

My apologies to DOPES! for any unkind words I have ever posted.

good times to come said...

Europe is sooo fu#*ed.

China India and Africa are about to surpass the EU in every area.

It is without a doubt that for the next several thousand years all of Europe will be mired in tribal wars, plagues, starvation, diseases and well deserved darkness.

Nature always has its way.

Anonymous said...

Anyone in the UK who didn't buy a 800k house for 1 million with 200k cash back at close and take out a northern rock loan for 1.25 million and then take the 450k and run is a fool.

Or honest...

The car loan isn't really the same, the car drops in value the moment you sign the paperwork so all car loans for new cars start "upisde down" anyway. What's a little deeper water overhead?

Anonymous said...

RE: Northern Rock's 125% mortgage and personal loan combo.

They must have gotten this idea from automobile manufacturers.

With good credit, GMAC will write a 125% car loan. This allows a customer to add stereo equipment, tires and wheels, lowering kits, pickup tops etc. to the loan.

There are also various rebates and other incentives.

However, I don't think that it is possible to get cash back at closing on a car deal. This must be a special real estate-only provision.

V.L.


The add ons would have been part of the purchase price, but you could trade in a car that you were upside down on to get into even more trouble. I can see the $30K millionaires out there doing this. You can't expect them to drive a car over three years, can you?? It would probably go something like this. Owe $15K on 3 year old POS. Get $10K trade-in on that brand new BMW 328i that costs $40K. Finance $55K-$60K on a vehicle that's worth about $32K after you drive it off the lot. Genius.

Anonymous said...

Anyone in the UK who didn't buy a 800k house for 1 million with 200k cash back at close and take out a northern rock loan for 1.25 million and then take the 450k and run is a fool.

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I know the policy in the US is not to prosecute anyone for fraud, but what about the UK?

Anonymous said...


Racism is wrong, by the way; and the irony is that Obama is only half-black, and his black father is a PhD in Econ (think Math).


So anyone who doesn't vote for Obama is a racist? Get your Jesse Jackson ass out of here, you sleazy race pimp.

His father was a drunken wife-beater and dropped out of Harvard after flunking out of Economics course. He ended up going back to Kenya and having more children since his student visa was revoked.

Nice story you made up though. I guess that is part of the Legend of "Jesus" Obama along with those old white women fainting in his holy presence.

Veronica Lodge said...

Anonymous said "Owe $15K on 3 year old POS. Get $10K trade-in on that brand new BMW 328i that costs $40K. Finance $55K-$60K on a vehicle that's worth about $32K after you drive it off the lot. Genius. February 23, 2008 7:09 PM

Some used car dealers keep a few cars on hand that they were able to buy "back of book." These are cars which, for one reason or another, are selling wholesale for considerably less than blue book prices.

These cars are perfect for people who are upside down in the car they want to trade in. Since the bank will do a loan on the retail blue book value of the car, there is enough wiggle room left to pay off the underwater trade in. Unfortunately, the new blue book will come out and correct the value of the purchased car and the customer will be underwater again.

It's too bad that there isn't a way that someone could trade in an underwater house for one that can be bought back of book.

The problem is that there is no blue book for houses -- only comparable sales figures.

V.L.