This could trap new homebuyers with smaller deposits in a sticky situation, known as a mortgage prison, as the property market slumps.Why are Australia's interest rates still rising?Looming interest rate hikes and the soaring cost of living will take some pressure off the housing market.Mortgage prisoner is the apt term for a borrower trapped in their current mortgage who is unable to refinance their loan.
For example, interest rates could sit at 5 per cent but the lender will look at your ability to pay up to 8 per cent. This means people who are already in a mortgage prison become even further entrapped and White warned more and more people are getting stuck.Interest rate rises are the common denominator for property prices falling and therefore more people getting trapped in their home loans. as an attempt from the central bank to settle spiralling inflation.The Reserve Bank of Australia building is seen in Sydney, Tuesday, October 1, 2019.
well durrr
Inevitable. And when delinquencies start to rise and they will, defaults and foreclosures follow. And with interest rates still high and likely going up nobody will be buying. Prices fall. Hard. 30, 40% and that's when I deploy and buy buy buy. Fiscal responsibility is key.
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Why more Aussies are getting trapped in a 'mortgage prison'As property prices continue to drop across Australia and interest rates trend upwards, some borrowers are finding themselves trapped in their current mortgages with no way out. 9News Property prices seem to still be climbing about 40mins outside of Brisbane. We are still seeing neighbors selling for astronomical prices. This price drop simply hasn’t made it here. Is it only central Sydney ? That was the RBA’s plan. QE ad nauseum to drive up property prices (and everything else). Rates at rock bottom for so so long to get as many households borrowing as possible. Then the rug pull….. bringing you the glaringly obvious I guess that's what happens when politicians who face no repercussions for pumping billions of dollars into the economy spurred on by bureaucrats and the media
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