Im going to make my own prediction seeing as how everyone else is having a go. House price data will show prices declining for the rest of 2008 and into the first 1/4 2009 interest rates will fall on the back of a gloomy economy. May 2009 falls stop, prices rise as mortgages are cheaper than rent

Basil Bell, Bath,

Michael from Kent - well said! so many people moaning and groaning because times are "hard". I do feel for those who loose their jobs due to irrational fear but seriously folks, how bad is life in the UK really? Have a though for the millions of starving people in the world, stop being so ungrateful

kevin, sleaford,

I dont really have a lot of synpathy with those who are in arrears and facing reposession. Back in the 80s mortgage rates hit something like 17% fortunately not for long. My wife and I didnt complain about how unfair it all was etc etc we just got on with making sure we could pay it.

michael, kent,

Now that the Government has protected the savings of those who invested in bank/building society accounts but ignored those invested in other forms of savings like pensions, shares or bonds, the banks will soon be awash with cash. That means much lower interest rates. The banks should hold fire.

John, Gravesend, UK

K Mead, because house prices are falling so fast, when a homeowner falls behind with their payments, the banks need to repossess as quickly as possible. If they give the owner time to try and sort themselves out, the value of the house falls further, increasing the risk for the bank.

Daniel, Oxford,

I am coming to the end of a discount variable deal next month and I have asked a rhetorical question to lenders: why is there a penalty if you you pay off your debt early ? no one seems to know why. I am sticking with the SVR, switching to interest only and watching if the rates come down

Carlos, London, UK

With negative equity quit the house ASAP.

Banks expect you to stay in your current home at all costs, let the bank repossess, the negative equity will then crystallize with the bank, but don't miss a mortgage payment.

Rent until house prices stabilise.

Then decide if you ever want to buy again.

Terence Park, Burnley,

At what point did banks become charities? If they don't repossess properties they will never make a profit. If the government is that bothered then dream up a rescue scheme.

And the liberal judges give people plenty of opportunities before they are repossessed. Even when the cant/wont pay.

Stephane , Manchester,

Wake up & smell the Roses. Bricks & Mortar is temporarily under valued. Unlike equities Real Estate values will spring back - like a submerged football..

Richard, Stanstead Abbotts,

I understand people need a place to live but the prices being requesting were outrageous. I live with my parents at 33 hardly ideal but refuse to tie my life to a job monotony & to quarter of a million debt on a poorly constructed rabbit hutch that will not house my worldy possessions.

Angela, kent,

Verpoucke Marc,

Inflation has probably taken it's toll in Belgium too during the last 38 years.

As for losing all connection with reality - we did that when we joined the 'common market' and handed over control to Brussels.

j griffiths, manchester, england

Catherine is correct: negative equity is really only an issue if the home owner needs to sell because they can no longer pay the mortgage - other wise you sit tight untill your house/home has increased in value again - which I am sure it will eventually - or untill your loan value is reduced.

Mark, Framlingham, Suffolk

Democracy depends on people making rational decisions in their own interest. If not, never save again! My house in 1968 cost 8000 pounds. My salary was frozen in 1974 at 8500 per year. In 2007 it seemed wise to sell my flat - just in time! We live in troubled times when politicians haven't a clue.

Brian Lewis, Manila, Philippines

The reason banks are vigorously repossesing is that they are trying to crystalize a loss on the property before the market takes another dip in the new year. If they wait any longer they know that the current decline in value will probably double, possibly reaching 50% & increase their loss.

Matt, Bournemouth, UK

Banks are institutions that will lend you money if you can proove that you don't need it.

Kevin Monk, Crystal Palace, UK

For a story about debt forgiveness, see Matthew (18:23-34). Sounds an awful lot like Northern Rock to me...

rogerc, Kamloops, Canada

The owners of the negative equity houses will not lose them if they still have incomes with which to keep making payments. True, nobody will buy the property, but the owner has a place to live and wait for a market upswing. He has not lost or gained anything until he actually sells the house.

Jon Maynard, Lansing MI, USA

Thirty eight years ago I visited the UK for the first time. It was very charming to me... At that time you could easily buy a village house for 8.000 pounds. A year ago it was 400.000. I believe you've lost all connection with reality. These are nothing but old houses you know!

Verpoucke Marc, Oostende, Belgium

No one held a gun to anyone's head and forced them to buy property - on any terms. I don't believe the Government actually "encouraged" (as the Tories allege) people to take on vasts debts. Benign economic conditions reigned. Banks and their customers behaved irresponsibly.

david, Ligneyrac, France

K Mead, Bedford, UK : Surely the better way is for the holder to sell up, give back the item they can no longer afford, go and buy something they can afford or rent, and free it up for somebody else who can afford it without overstretching themselves like the previous owner obviously did.

Tom Franklin, London, UK

Who will buy all the homes they repossess, now there are no mortgages available?
Jane Doran-Webb, Riberac, France

Housing associations that will give them to those who don't even pay the taxes that have rescued the banks. And Russians.

Welcome to Brown's immoral Britain.

Laura Roberts, London, UK

Banks have always been fair weather friends, I knew this forty years ago. What has changed? They lend when times are good but demand their money back as soon as times become difficult, making a bad situation worse. Who will buy all the homes they repossess, now there are no mortgages available?

Jane Doran-Webb, Riberac, France

I am at a loss why banks would wish to repossess homes for which a family has fallen behind in their mortgaged payment. Surely a better way is for the lender to extend a mortgage say for 5 years and permit the mortgage holder to pay only the interest due on the remaining amount.

K Mead, Bedford, UK

its easy make properties have a gap insurance so when negative equity strikes the mortgage loan is covered make councils pay good rents to landlords inotherwords make a profit it will also sort the housing crisis its so simple and instead of this goverment investing in banks lets buy are own oil wel

p cookson, stalybridge, cheshire

We bought our home in 1975 and saved till we had 25% deposit . No B Soc would consider lending more than 3x salary and then only after saving with them for at least 2 years to prove credit worthiness. How thankful we were for such prudence when intr rates soared to 16%. No sympathy for the reckless

Sarah, Belfast, N Ireland

You want cheap, affordable housing?....let this thing play out naturally.

And stop blaming the barrman for the hangover

p.s. i am not a homeowner

oliver c, colchester, essex

Lenders should simply raise their interest rates. They are broke and the main source of income is the interest payments. Northern Rock, RBS or anybody else should put their mortgage rates up to 10% or whatever it takes to sort themselves out. If the borrower cant pay then move their mortgage.

Guy, Edinburgh, Scotland

that is why they ran the immigration hare- it all makes sense now. I did say that some more nasty news was in the pipeline and this is it

peter c, Devizes, Wessex

Houses, shares and all other tangible assets are worth nothing unless, and until, they are sold.

Sara, Exeter,

John Mack - yes we can emigrate ... why not go to American where the sub prime system hit the housing market way before we got hit? Under the watch of a Republican government. Brown is NOT a superhero - or a super villian.

Diana, Derby, uk

I advocate a two-fold approach:

1.Let the banks take the agreed collateral(house) which was contractually agreed with the mortgage holder.

2.Change the laws so that the mortgage holder is not liable for the shortfall on an auctioned repossessed property so the person can walk away & start anew.

Jaedi, Madrid, Spain

Most of the people I know of that are complaining, do so, because THEY over extended themselves. The gov't, the banks or the credit card companies didn't make it MANDATORY to borrow or to spend. I find it amazing that no one wants to take personal responsibility & the media & gov't refuse to say it!

Liz, NYC, USA

I Have To Agree With All Statements Made Here But Strange.
Is It Not, That The Polls Suggest That Brown Is on a bounce
People will Forget The Disasters,Gold On the Cheap,Lost Data And A Whole String,One Day In Politics Can Make People Change Their Minds,Wierd.

Thomas Denny, Surbiton, uk

No, the government won't buy votes, the local councils will just buy surplus properties that aren't selling and rent them out.

Mike, Edinburgh,

Jon@Derby asks; " why not extend the term ".

1. Banks arn't a charity.
2. They've lost our money to the Americans.
and basically......

They need our cash.

My tip is, this will take years and years to sort out.

M. Walker., Nr Bromsgrove., Worcs.

Prices of houses or can I call them homes are ridiculously high, they need and will drop. No recovery will be possible until we return to values being back to 3.5 X salaries.

A drop in values is desirable, I hope the government understands this and does not try to buy votes by keeping them high.

Miller, Redhill, Surrey

Isn't it inevitable that the same banks which behaved badly when lending money, will now behave badly when asking for it back.

Michael C, Devon,

Lol, Yvette Cooper pipes up and says there will be curbs to slow down the number of repossessions yet her government is presiding over an institution that is falling over itself to repossess! Has she realised that banks, in order to recapitalise, need a mortgage payment or a house sale toget cash???

Jonathan, Coventry, UK

most comments have more substance than the article-the only thing I'd like to add is: all this is "calculated" based on a continuation of current trends(who says it will?), ergo extrapolated by herd mentality disciples:economists and the oh so smart subprime AAA raters from S&P-laughable!

George, London,

I don't rely on banks, I only need their money to have a place to live. I don't believe that it's better to have savings with 8% of profit and also a loan with 5% of interest. Sth is wrong, My father says: firstly pay your debts, don't carry your eggs in the same bag and about money rely on nobody.

Julian, MADRID, SPAIN

This is a complete non-issue. Negative equity just means your asset is worth less now than when you bought it. Well, so what? All this talk of "I'm paying for nothing now" is ridiculous. You've got possession of an asset that also serves as your home. Stop complaining, there is no issue here.

Catherine, London, UK

Guidelines, and a structured repayment plan, maybe part of a process before repossession. However there has to be some punitive measure so that home owner, with an outstanding mortgage, do not default on payments and accept their responsibility in paying back the loan.

Mr R Norton, Shrewsbury, U.K.

Northern Crock has switched many of its staff from sales support to debt recovery roles. The staff want to keep their jobs so they are hot on chasing late payers and accelerating the default and repossession process. Not what the Labour Government expected, as usual.

chaplain, canterbury,

Whilst we have the greed of capitalism. Millions for the few - misery for millions - we shall continue to have 'boom and bust'.
This despite Brown's weasely words.
Perhaps it is now time to revue socialism for the 21st Century.

roy ormond, skipton, uk

If it is we, the taxpayer, who are helping to bail out the "poor" banks, then there should be some reciprocity from the banks to help cushion the effects of negativy equity. If the bailout does not address the root cause of the problem, inflated house prices, expect worse pain to come.

Anthon Wolff, London, United Kingdom

I think it is disgusting how banks are being so inflexible over helping people to keep possession of their house especially since UK taxpayers have been so "flexible" in ensuring they stay in business. The UK taxpayer seems to have the short end of the stick every which way!!

Rhian, Manchester, UK

What crisis?

If you can afford your mortgage payments and have negative equity, stay put, sell and owe the difference, sub let, rent. Where's the problem?

If you can't afford your mortgage, sub let, or sell up and rent. Where's the problem?

You took the positive equity, now take the negative.

Laura Roberts, London, UK

Gosh, what is clear from the comments below is how much people misunderstand the connectivity of the many events in the current climate. The banks are repossessing because they need to secure their assets, but selling repossessions only adds to a depressed market - This is a helter skelter ride.

Duncan, Wokingham,

It's of no use to blame the banks when greedy folks have with full knowledge of their own personal circumstances have borrowed far more than they can ever hop to repay to make purchases at over inflated prices in the hope that others would be as silly as themselves and later buy them out.

Chris Wilson, London,

Solution ban repossession except in the case of fraud. This will make banks more careful in vetting and borrowers realistic in giving income details. The house will then be willed to bank and loan extended for life if necessary. Normal seizure excludes certain basics why not the most basic of all.

bill, cornwall,

If the bank rescue plan works and interest rate's continue to fall mortgage payments should move lower helping everyone.
However this scaremongering about negative equity is not helpfull many housholds spend tens of thousands of pounds on cars and don't complain about the instant losses they face.

Dave, Mold, UK

As for the point that 2 million will face negative equity compared to 1990's housing downturn one would expect that to be the case because there are far more home owners today than in the 1990's.

Dave, Mold, UK

The problems really arise for home owners not only when they have reached a negative equity situation, but they then have to live with the fact that in many cases they could rent a property for much less than their monthly mortgage payment.

Simon Hare, Hove, UK

Somebody once defined recession as 'when money returns to its rightful owners' . So, time for all the BTL landlords, amateur property speculators, hedge fund mis-managers and the rest to get their just rewards. Don't all cry at once

Paul, Tonbridge ,

Where did they get the 20% figure from? We bought our first house in 1989. A few years later we changed mortgage lender and found it was worth 36% less. You just have wait for the price to go back up again - as it will.

Andy, Southend, UK,

What is wrong with the banks extending the term of the mortgage for those in trouble rather than jumping to repossess? They were quick enough to hand out ridiculous loans to people, often without wanting proof of income. They should not now be allowed to take people's homes from them.

jon, Derby, uk

How can anyone get excited about negative equity. All thos 100% plus loan to vlaue mortgages sold in 2007 (which Gordon Brown seems keen to resurrect) were effectively instant negative equity mortgages. To work out equity one must account for all debts not just a mortgage.

john p-t, reigate,

This is all very well but the only people that are going to benefit from this are our children

steph, bridgend, wales

I bought my house many years ago. It didn't bother me one way or the other if the value of my home went up or down, I was happy with my humble castle. A lot of people who are now complaining about the fall in the price of their homes are
insecure, they didn't moan about soaring prices. Tough!

brian keating, agde, france

In considering repossession it is important to understand that it will not be the houses with negative equity which will be at the greatest risk.

The lender will wish to ensure that their funds will be recovered intact before launching proceedings. The examples quoted will be typical and so logical

Martin Cole, Angouleme, France

I have a good job ,low mortgage ,no credit cards ,two cars ,loads of holidays -life has never been so good for me and lots of my friends are in same postion.Next time your on motorway just clock the endless stream of 4 litre new range rovers flying along -bad for some buts still lots of cash around!

andrew, leeds, w.yorks

It is always buyer be aware. It has been clear last few years that the houses are overpriced and the prices are unsustainable. Yet, unthinking over competitive speculative house buying and over bidding price have brought the west to its knees. Now the chicken have come home to roost.

raj, harrow, uk

Lets move now to a fair policy on homes. Each individual to own a maximum of two houses. Ban all businesses from owning residential property. Bring repossessed housing into public ownership and build better quality social housing. We need to end 'the housing market' once and for all.

don craigton, wakefield, u.k.

Only a problem if you are trying to sell. So, you've bought a house, live in it. What a concept.

There is no right of the poor to have something they can't afford. Well, until Lord Obama takes over.

ce, Phx,

If our western capitalist system had instead been a socialist one and it had failed to the extent the capitalist one has at present there would have been shrieks for heads to roll and an utter condemnation of the system as unworkable. So maybe a system that benifits a few greedy people needs changed

Peter, Vancouver.BC, Canada

If Banks don't repossess and dispose of it now. The house price might fall further still. This means less to get back and increase the amount of write-offs. The end result is more debts cause the banks to collaps. The approach sounds sensible. To lend buyers 5 times the salary is absurg to start.

dominik, london, uk

David, saldy I have to disagree with you. I work in the industry and we are seing the number of people handing in their keys increasing already. People mistakenly feel that if they are having problems and their home has gone down in value that they can simply walk away.

Katy , Ipswich, UK

Negative equity is immaterial if you live in the house and intend to stay there.This must be the situation for the majority of people with mortgages and providing you keep up the payments you are OK.Where there does seem to be a problem is when the mortgage was used to increase borrowing.e

Ed Corbett, bridgend, wales

No more MEW-ing to pay for those foreign holidays now, eh?

Paul, Coventry,

Absolute common sense from David Nammory.
There may be other factors that contribute to repossession but surely negative equity is not one of them.
Perhaps it may prevent the owner from borrowing more which, in the present climate, may not be a bad thing.

P. Loughlin, Chester-le-Street, England

Just waiting for the doom mongers to arrive, telling us how prices are going to drop by 70%, how every owner deserves it for being greedy money grabbers and how they are going to be waiting in the wings to snap up a bargain!

Only people with hard cash will benefit from this as prices rise again!

Darren Ward, Manchester, UK

How many of those with negative equity,are the same people who took out self-certificated mortgages and deliberately exagerated their earnings in order to qualify for a larger mortgage than they could properly afford . Why did our regulators not take steps to stop this from happening.

Mike, Dunstable, England

I would think, a vast number of homeowners are in negative equity by taking out re mortgage debt consolidation deals to pay for irresponsible credit card spending in boom time.I actually know people whose ridiculous credit card spending was regularly paid for by extending their mortgage.

Alan, Leatherhead, UK

All 100% predictable, and all 100% predicted. You were all warned. Gordon Brown tries to make out that this is an unexpected shock, but it is the system collapsing under its own weight of unserviceable debt. And he wants taxpayers to bail out the idiots who overstretched?

My advice? Emigrate.

John Mack, Aberdeen, UK

To protect its investors/depositors banks must have no mercy on defaulters where the loan is at risk. If there is to be assistance then that is up to the Government not the lenders. After all those who borrow are responsible for servicing the debt.

Dirk, Auckland, New Zealand

I still maintain that this whole recession/depression is overblown. Of course the credit markets need freeing up and trust needs to return to the banking system but don't forget, people lose their jobs and have their houses repossessed in the good times as well.

Paulie, Loughborough, England

It is not the house that falls in value, it is the land it stands upon that falls in value. When you understand that you will know how most people get screwed, and who the politicians are covering for in the crash that has been forecast for 10 years.

David Brooks, Geelong, Australia

There's this waft of inflation in the air....worldwide, Folks, be prepared to cart home a days pay in a wheelbarrow, because the politicians are intent to show you can have your cake and eat it too.

Barry , Santa Ana, USA

Abolish credit cards and make mortgages repayment by direct debit.

m wilson, bidache, France

You pay your many and take your chances, here's looking forward to another series of Location, Location, Location!

James Marlow, Horsham,

Just because a homeowner has a property that is worth less than the debt does not mean that that debtor is anymore likely to walk away from the debt than if the house price was static.
As long as the householder can afford the repayments he will do so. No one believes that the debt would not folow

David Nammory, Liverpool,

If home owners lose their homes, does mean an increase in apartment demand? Or an increase in homeless people who can not afford housing, and sleep in carboard boxes around the city. - How far is the repossessions on the poor going to go?

kevin, Redlands, ca., United States