Those in negative equity should discuss debt issues

Mon, 02 Jul 2012

Homeowners with negative equity should discuss issues with their provider, it has been suggested.

Paul Holmes, chief executive officer at Firstrung - a company aiming to offer solutions to first-time buyers - has noted individuals need to focus more on how to tackle the problem rather than concentrating solely on the value of their property .

Mr Holmes recommended people should contact their lender and look to reduce the term by upping the payment and driving down the .

By paying off their home loan early, people are likely to find the situation ceases to be of relevance.

Mr Holmes explained the Bank of England's artificial base rate of 0.05 per cent is unlikely to last too much longer, adding: "Once rates goes up to four or five per cent which is still reasonably modest, people are really going to suffer."

He noted householders may have seen the value of their home dip from £150,000 to £140,000 in recent times - but observed the fall will not matter once the mortgage has been repaid in full.
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