Prices dropped by 0.2pc in May, the third monthly fall in a row, according to Nationwide Building Society, marking the biggest sustained decline since the aftermath of the financial crisis in 2009.
Rules introduced following that crisis were responsible for creating the first wave of “mortgage prisoners”.
This group – thought to be around a million strong – typically borrowed heavily, putting down only small deposits, in the last years of the 2005‑07 housing boom.
Some were existing homeowners who remortgaged to draw down property equity. But as prices fell and the credit crunch took hold, lenders were subsequently forced to tighten their “affordability” checks, leading to borrowers being refused new deals.
Instead, when their original deals expired, they were forced on to far more expensive “standard variable rates” (SVRs). And there they stayed: unable to secure a better rate with their existing lender or to switch elsewhere.
More from the source: Mortgage prisoner explosion: why a new generation is at risk of crippling rates
DOOMED!!!
