>>>>Interesting article here
>>>>
>>>>http://newsvote.bbc.co.uk/1/hi/business/7529277.stm
>>>>
>>>>I didn't realise that in the US you could walk away from a debt like that and not be pursued. So people are walking away from paying for their house because it doesn't make business sense any more
>>>>
>>>>In the UK people who hand back their keys because they can't afford their house anymore are routinely pursued if the sale of the house by the bank fail to raise the full amount of an outstanding loan.
>>>
>>>
>>>This is all very strange. Could not imagine such thing is possible at all. Especially not in US.
>>>How about downpayment, how about guarantors ?? Don't they need to have quarantors for the loan ???
>>
>>No, you don't need guarantors for a mortgage here. The idea is that the house itself is your guarantee. Also, with many of the loans that are the problem, the down payment was tiny or non-existent.
>>
>>The rule used to be that you could only get a loan for 80% of the purchase price (except in some special cases). What happened a lot in the last few years is that the lenders set up special plans where the borrower could borrower the whole thing. That's part of why it's all collapsing.
>>
>>Tamar
>
>In the UK it was possible to borrow more than the value of the house (typically 125%). Again the expectation was that rising prices would take care of the excess amount.

I knew real estate values were appreciating like crazy in the UK, at least in London. Is that still the case or are you also going through a correction?