Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : The Residential Real Estate Crash Index -- Ignore unavailable to you. Want to Upgrade?

To: patron_anejo_por_favor who wrote (135979)	7/23/2008 3:26:21 PM
From: Elroy Jetson	Respond to of 306849

UK Lender offers home borrowers 8% discount to leave Times (London) -- Mark Atherton -- July 22, 2008 timesonline.co.uk Edeus, the specialist mortgage lender, is offering borrowers a discount of up to 8 per cent if they redeem their home loans and take them elsewhere. The offer from Edeus, which deals in sub-prime, self-certificated and buy-to-let mortgages, has been triggered by the credit crunch. Edeus used to generate cash by selling its loans to other financial groups but, in the past year, demand for such loans has dried up. Organisations prepared to take on the loans are demanding such high discounts that Alan Cleary, managing director of Edeus, has decided it would be cheaper to go directly to borrowers. He said: “We are offering customers a discount of up to 8 per cent if they redeem their mortgages now. This means that, on a £100,000 loan, they would have to pay back only £92,000, with no exit fees or early redemption charges.” The offer is being made to 400 customers, representing about 10 per cent of Edeus’s mortgage book. The discount offered will vary from 8 per cent to between 2 or 3 per cent, with the average being struck at about 5 per cent. The figure will depend on the market value of the loan if it were to be sold to another provider. Mr Cleary said: “No one has tried this before because, until recently, there were always plenty of financial groups ready to take on our loans at a premium — we had no need to offer inducements for people to take them off our books. If the experiment is a success, we will extend the offer to more customers.” .