Debt off-setting

needmore

Has anyone seen this website,
or know more about it?

check out this link: http://offsetdebt.net/

It could be a way out of the muddle homeowners find themselves in.
negative equity seams to be the buzz word of the mortgage burdened homeowner. Maybe we should push theses issues on the doorsteps as the canvassers come knocking??:pac:

So, get the bonds to take on debt, issue the debt to a homeowner, be paid back with the debt which they issued themselves.

You are basically asking the banks to give you an unsecured loan to pay back secured loans.

Karl Deeter had a concept that was similar [ULR=http://misc.mortgagebrokers.ie/images/blogimages/2010/June2010/Negative Equity Loans.pdf]here[/url].

Some plan based on both aspects might actually be feasible, however, I can't see the banks rushing to further weaken their balance sheets at this particular moment in time.

needmore

2010 FIGURES? i wonder what the 2011 figures will be??:mad:

negative equity, Duffy (2009)4 whose key descriptive statistics are;

2007 – 19,525 homeowners in negative equity
2008 – approx 50,000 homeowners in negative equity
2009 – est. 116,000 homeowners in negative equity
2010 – est. 196,000 homeowners in negative equity

To stay on topic though, I think all candidates should be grilled on what they are doing to help people on negative equity.

I fully intend however, to support those offering reasonable solutions, rather then bail out.

needmore

I agree, people need to use this opportunity to discuss national issues with the candidates and not waste time on the 'Parish-Pump' issues!

ixtlan

Big sigh... I wish there was an icon for that...

Everyone has sympathy for those in negative equity. It certainly may happen that something will have to be done for them. If/when that something comes about it will not be painless. It's likely that those who are not in negative equity will have to fund those who are.

Trying to portray this as a "no-brainer" is the kind of simplistic populism that in some ways got us into this situation. I see the web-site has "gainers" and "benefits" but no "losers" or "problems".

The losers are clearly the bond holders who end up with a bond worth half what it was, even if the interest rate is a little higher. The bondholders get a better deal than the banks have been offering them. is only true for the subordinate bonds and they are lucky to be keeping their shirts at all. The senior bondholders have been getting 100% of their value.

The problems are that right now the ECB is keeping us afloat only because we are not "burning the bondholders". That's what this solution is, just with a more appealing name. We cannot afford to burn those bonds because the ECB would them cut off funding to the banks... and that's before we get to the issue of the bailout...

Now... to clarify... I am all in favour of a resolution that gets discounts on those bonds, with some form of Euro-zone agreement. However people need to realise that the level of "burnable" bonds is dwindling, and it now a rather small part of the total cost.

ix.

ArtieD

@ zaraba
i think you have the wrong end of the stick on this. For the homeowner this just looks like a standard remortgage, except that they end up owing less not more.

@ixtlan
Yes, it is a dwindling pool but at 30Bln fix for the 80Bln 'principal private residences' would be a big change for the homeowners. And no one is getting burnt. We are only taking what is on offer in the market. Nothing is being imposed which is what 'burning' means.