High LTV deals will result in a spike in repossessions soon
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Having read your article on borrowers facing a payment shock if interest rates rise, I believe high LTVs are the problem.
Anyone who bought at 95% LTV in the past three years is probably facing negative equity now. They won’t be able to remortgage and if their payments rise and they realise their house is worth less than they are paying for it, they will simply walk away.
That is when repossessions will ramp up and we run the risk of a flood of cheap property in the market.
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