Mortgage Arrears Problem in Ireland.

citizenofeire

I will give my No.1 vote to any political party who will bring in legislation to help the vast amount of citizens of Ireland who are in arrears with their mortgages through no fault of their own.

In Feb. 2010 a Special Group was set up by the Government to provide some solutions to this very huge problem in Ireland. I would imagine these people were paid very well for their services.

At the end of 2010 the Group came up with a number of recommendations, which quite frankly, were of little help to those facing the threat of re-possession.

With mortgage interest rates rising there will be many more Irish people falling into mortgage arrears.

I am calling on all candidates, who are seeking election, to make the mortgage arrears problem in this country one of your top priorities.

If there is any support out there for my very strong feelings on this problem, please let me know.

Einhard

citizenofeire wrote: »

I will give my No.1 vote to any political party who will bring in legislation to help the vast amount of citizens of Ireland who are in arrears with their mortgages through no fault of their own.

Oh, you mean those people whom the banks forced at gun point to take out huge mortgages on property that was clearly overvalued?!

I'll vote for anyone who proposes to wipe out my Credit Card debt incurred on foreign holidays through no fault of my own...

Seriously, I have all the sympathy in the world for those in arrears, and wouldn't have a major problem with some form of assistance, but the idea that they bear absolutely no responsibility for their own situation is absurd. Nobody forced them to purchase their houses, and it was pretty clear back in 2006 that the housing market was overheating. There was no shortage of voices warning people. If the government are to blame for not heeding those voices, then the people who did likewise are likewise responsibile.

citizenofeire

citizenofeire wrote: »

I will give my No.1 vote to any political party who will bring in legislation to help the vast amount of citizens of Ireland who are in arrears with their mortgages

how about bankruptcy law reform so they can go bankrupt and hand back the keys? 3 - 5 years and they come out of bankruptcy......?

Seems the fairest instead of throwing taxpayers money at overinflated mortgages.....plus it allows firesales which is great for the economy.

The only problem is the banks and the guarantee

Bottle_of_Smoke

Would also like to take issue with ''through no fault of their own"

How do you define this?

citizenofeire

It must feel great to be so smug.

You must be the lucky ones who still have jobs in Ireland.

The majority of people who are in arrears with their mortgage, are those who have lost their jobs or their business.

To generalise this situation is very easy.

Try being in the shoes of those who have lost everything.

sollar

Deleted User wrote: »

how about bankruptcy law reform so they can go bankrupt and hand back the keys? 3 - 5 years and they come out of bankruptcy......?

This is where the solution lies imo. There is no point in giving a few extra euros relief to someone in arrears who paid 450K for a house that is now worth 150K.

People need a way out of this mess. The country is just going to have to accept that this problem is not going to go away.

Einhard

citizenofeire wrote: »

It must feel great to be so smug.

You must be the lucky ones who still have jobs in Ireland.

The majority of people who are in arrears with their mortgage, are those who have lost their jobs or their business.

To generalise this situation is very easy.

Try being in the shoes of those who have lost everything.

I'm not being smug. How could you take what I stated as being smug? Do you have this attitude to everyone who doesn't slavishly agree with you?

As I said, I've no major problem with some assistance, but I draw the line at people trying to absolve themselves of ALL responsibility for the situations they placed themselves in.

Ps: I don't have a job. Neither though do I have a house. I couldn't afford one back in 2006, so I didn't buy one.

big b

and what about those who've lived on beans on toast, sat in a cold house to save heating oil etc etc to ensure that they payed for the roof over their head?

you can't simply bail out everyone in arrears, it's entirely unfair to those who've scrimped & scraped to get their monthly payment together.
And I say that with some sympathy to those who have done the above & still failed to meet their obligations.

Dannyboy83

Suppose for a second that we did bring in some scheme to help these people with their burden.
Than banks have no money so obviously the difference has to be made up by the taxpayer.

How do we ensure that the taxpayer who was sensible and didn't overextend themselves is not expected to carry the burden of the those who did overextend themselves?

I can think of no surer way to stoke a mass wave of emigration, than to tell those who don't own houses and are probably waiting for the opportunity, that they will be taxed to help pay the mortgages of those who do

citizenofeire

I am not asking to be bailed out, nor am I asking to have my mortgage paid off for me.

I am asking for leglisation to be introduced to stop re-possession of the homes of those who are making an effort to pay what they can from their reduced income.

It seems to be the general opinion that those in arrears are speculators or developers.

Quite the contrary. The majority are ordinary people who purchased their family home at the wrong time.



T

Yitzhak Rabin

citizenofeire wrote: »

I am not asking to be bailed out, nor am I asking to have my mortgage paid off for me.

I am asking for leglisation to be introduced to stop re-possession of the homes of those who are making an effort to pay what they can from their reduced income.

It seems to be the general opinion that those in arrears are speculators or developers.

Quite the contrary. The majority are ordinary people who purchased their family home at the wrong time.



T

Currently most banks do work out payment schedules with those who lost their jobs. If it gets to the point where the person can't pay back more than a miniscule amount then what options are left? The bank has to repossess the home. As it stands the banks are public entities i.e owned by the taxpayer. Its not fair to ask your fellow citizens to pay for your mortgage because you find yourself unable to pay it.

Thats the very opposite of fair.

More realistic bankruptcy legislation is something I would be in favour of.

edit: Fine Gael (much to my disappointment) is proposing to bring in a more generous mortgage interest relief scheme for those who bought during the boom.

Dempo1

citizenofeire wrote: »

It must feel great to be so smug.

You must be the lucky ones who still have jobs in Ireland.

The majority of people who are in arrears with their mortgage, are those who have lost their jobs or their business.

To generalise this situation is very easy.

Try being in the shoes of those who have lost everything.

Yes, agreed whole heartedly

I can predict this thread to descend in complete nonsense. The OP's point is a legitimate one, whether or not some people dislike the notion of support mechanism's or some legislation something is going to have to be done. Not withstanding the fact the banks are in no position to survive mass default (although their recent interest rate hikes suggest they are living in cuckoo land), the court system will collapse and the irony of it all, guess what, the government and us the tax payers will end up contributing anyway whether it be through social housing, rent allowances etc etc.

Make no mistake to anyone who is arrogant enough to suggest all is Rosy in the garden, the mortgage crisis is about to implode and incidentally not just those in so called negative equity, all sections of society are clearly affected even those who took out sensible mortgage pre Celtic tiger madness!

Yitzhak Rabin

Dempo1 wrote: »

Yes, agreed whole heartedly

I can predict this thread to descend in complete nonsense. The OP's point is a legitimate one, whether or not some people dislike the notion of support mechanism's or some legislation something is going to have to be done. Not withstanding the fact the banks are in no position to survive mass default (although their recent interest rate hikes suggest they are living in cuckoo land), the court system will collapse and the irony of it all, guess what, the government and us the tax payers will end up contributing anyway whether it be through social housing, rent allowances etc etc.

Make no mistake to anyone who is arrogant enough to suggest all is Rosy in the garden, the mortgage crisis is about to implode and incidentally not just those in so called negative equity, all sections of society are clearly affected even those who took out sensible mortgage pre Celtic tiger madness!

Exactly, and the reason we are in this mess is very few people showed prudence while racking up their debts. There is too little personal responsibility in this state and everyone wants to blame everyone else and everyone wants someone else to pay their way. The cards should have been left to fall where they lie. Government intervention in the banking and personal mortgage debt is immoral.

EricPraline

citizenofeire wrote: »

I will give my No.1 vote to any political party who will bring in legislation to help the vast amount of citizens of Ireland who are in arrears with their mortgages through no fault of their own.

The issue is that this kind of legislation will undoubtedly have a significant monetary cost, either directly if we're talking about tax breaks or indirectly through further capital requirements of the banks if loans are no longer serviced or are written down. Who are you suggesting will provide this funding? Other people who are also barely managing to pay a mortgage or rent?

Tax increases and cuts are inevitable to meet our existing funding shortfall and service our national debt. OP I'm genuinely wondering how you think this kind of legislation can be financed?

the groutch

there's a point tho where it's obvious a person just can't pay their mortgage and banks can't wait around forever in the hope they'll get a new job

Duke Leonal Felmet

I presume this bailout of those in arrears will come out of my pocket, as usual? This in spite of the fact that I have no mortgage and no credit cards. I behave prudently, yet I get punished because of peoples greed.

What a country.

sollar

Duke Leonal Felmet wrote: »

I presume this bailout of those in arrears will come out of my pocket, as usual? This in spite of the fact that I have no mortgage and no credit cards. I behave prudently, yet I get punished because of peoples greed.

What a country.

Consider it a form of welfare. People make bad decisions in life and sometimes need help.

Duke Leonal Felmet

sollar wrote: »

Consider it a form of welfare. People make bad decisions in life and sometimes need help.

Great. So people make innumerable stupid decisions and those who play life carefully suffer. Sorry, you are trying to compare this to real welfare, where people are born into hardship and require some assistance. This is nothing of the sort, and it is highly disingenuous of you to suggest otherwise. You are fooling no one but yourself with that line.

In this world of yours, if I went out and bought a house that I could clearly never afford and then fell into arrears, I should be able to take other peoples money to solve problems that I created for myself. Money from people who acted prudently and had nothing to do with my decisions.

Insanity. Your sense of fairness is completely lopsided.

Dempo1

yekahS wrote: »

Exactly, and the reason we are in this mess is very few people showed prudence while racking up their debts. There is too little personal responsibility in this state and everyone wants to blame everyone else and everyone wants someone else to pay their way. The cards should have been left to fall where they lie. Government intervention in the banking and personal mortgage debt is immoral.

Here we go, the same old mantra. When are people going to face up to the fact that not all the citizens who currently find themselves in a terrible place right now acted irresponsibly. It does not take a genius to work out how many newly unemployed there are out there, much of it occurring at the tail end of the Septic Tiger. I know countless couples who borrowed sensibly, were in gainful employment and now find themselves on the scrap heap. I am certainly not advocating a blanket bail out and yes there are those who acted foolishly namely 100% mortgages etc (which the banks hold some responsibility for absurd lending practices) but at the same time there as many responsible borrowers with mortgages a decade or more in difficulty. I don't think it would take to much to separate unsustainable mortgages from those that could and should be restructured.

As for the banks, I can confirm from experience they do assist in some ways but pretty much in the area of Interest only payments which form a higher percentage of the over all monthly payment and even this offer is of little consequence to those struggling.

I do not expect the state to bail anyone out, however i do expect our government through us the taxpayer and indeed shareholders to reign in banks now increasing interest rates massively which ultimately will and is making the crisis worse. I also believe current legislation while on paper looks wonderful, it is incredibly difficult for mortgage holders to make head nor tail of what options are open to them.

As an aside, there is another disturbing development in the Debt crisis. District Courts are packed to the gills on the civil lists hearing 1000's of personal debt cases, such is the crisis District Judges in some areas are no longer granting installment orders against anyone currently on Social welfare, this leaves creditors a final option, Judgment mortgages against debtors who still have property. This further complicates any desire of banks to assist with mortgage maintenance or restructuring, its got so bad, even debt collection firms are going into receivership. Beneath the surface there really is a personal debt volcano waiting to erupt, something, anything is going to have to be done.

Dob74

Einhard wrote: »

I'm not being smug. How could you take what I stated as being smug? Do you have this attitude to everyone who doesn't slavishly agree with you?

As I said, I've no major problem with some assistance, but I draw the line at people trying to absolve themselves of ALL responsibility for the situations they placed themselves in.

Ps: I don't have a job. Neither though do I have a house. I couldn't afford one back in 2006, so I didn't buy one.

So being spiteful towards people who did will help.
The taxpayer has bailed out the lenders.
Just change the law so no one has to pay back more than the house is worth.
That would end banks driving the price of houses.

sollar

Duke Leonal Felmet wrote: »

Great. So people make innumerable stupid decisions and those who play life carefully suffer. Sorry, you are trying to compare this to real welfare, where people are born into hardship and require some assistance. This is nothing of the sort, and it is highly disingenuous of you to suggest otherwise. You are fooling no one but yourself with that line.

In this world of yours, if I went out and bought a house that I could clearly never afford and then fell into arrears, I should be able to take other peoples money to solve problems that I created for myself. Money from people who acted prudently and had nothing to do with my decisions.

Insanity. Your sense of fairness is completely lopsided.

This is life, people make all sorts of bad decisions and the state picks up the tab in some way or another. It happens all the time. Many people drawing money from the welfare system or the health system do so because of bad decisions they have made in life.

Yitzhak Rabin

Dob74 wrote: »

[/B]



So being spiteful towards people who did will help.
The taxpayer has bailed out the lenders.
Just change the law so no one has to pay back more than the house is worth.
That would end banks driving the price of houses.

Or how about this for a mad idea, people pay back the amount they borrowed.

Dempo1

Just for a moment, could people consider that a large percentage of those in mortgage difficulty actually want to see to their responsibilities, indeed these very people purchased a "HOME", may have borrowed responsibly and for a host of reasons now find themselves struggling. I actually believe there is an enormous amount of these people who are not looking for handouts or bailouts, just a workable mechanism with teeth to help them keep their homes and pay their way, albeit with some government legislation, extension of mortgages, controlled interest rates etc.

Why is it, that the mere mention of Mortgage arrears certain folk jump on the bag wagon with a **** them attitude, Quite bizarre but probably a sign of where Irish society has gone!

Depressing an enough to make me emmigrate (if i could)

citizenofeire

citizenofeire wrote: »

I am not asking to be bailed out, nor am I asking to have my mortgage paid off for me.

I am asking for leglisation to be introduced to stop re-possession of the homes of those who are making an effort to pay what they can from their reduced income.

legislation to stop reposession to those who are "making an effort" is asking for a bail out and is asking for your mortgage to be paid off by others. It would result in higher interest rates for those who are payin

whiteonion

NO, no bailouts. I lived within my means and should not have to bail out people who borrowed money they never could pay back. They can go and live in a cardboard box if they no longer can afford a roof over their heads!

hinault

The lending institution, before issuing the loan to the mortgage applicant, sends a valuer around to the property to assess it's value before approving a loan to a mortgage applicant.

So the lending institution carries some level of culpability when it valued a property in 2006 at 50% more than it's current value in 2011.

I am certain that if people could have got a 2011 valuation in 2006, we would never have had the problems we have.

Hotblack Desiato

Great, so as well as paying massive tax rises I get to pay your mortgage as well as my own. No thanks.

Archie D Bunker

ninja900 wrote: »

Great, so as well as paying massive tax rises I get to pay your mortgage as well as my own. No thanks.

For me it will be even worse - I didn't buy a house in recent years because I believed the prices were crazy and that anyone who does buy a house is foolish (and I am being very polite...) And now, I don't have my own house but they do, I am struggling same as anyone else, but I am supposed to bail out those foolish house buyers? Great, so in the end - I pay for someone else's stupid decisions, they end up having their houses paid by my taxes, and I end up having nothing because I can't afford to buy a house while paying someone else's mortgage. Some people really have strange concepts about fairness. On second thought - maybe bailing them out is a good idea - on one condition - force the banks to give people like me a 100% mortgage first, regardless of my repayment capabilities so I can buy an overpriced house I can't afford, and that way I'll enjoy the bailout also...

BluePlanet

This idea is so reprehensible!

I didn't buy during the boom because i thought the prices were crazy and people were being delusional. 2005-2006 people were already talking about the property bubble and the writing was on the wall.

If my tax euros are going to help pay from some of these reckless individuals then i demand that at least 1 bedroom in every house that taxpayers partially own, becomes social housing so we can put our needy, our refugees and our homeless someplace with security and permanancy. And no the person receiving the bailout doesn't get a veto.

fliball123

Duke Leonal Felmet wrote: »

I presume this bailout of those in arrears will come out of my pocket, as usual? This in spite of the fact that I have no mortgage and no credit cards. I behave prudently, yet I get punished because of peoples greed.

What a country.

Well let those without sin throw the first stone blah blah blah

As long as my taxes are going to unmarried mothers
As long as my taxes are going to Childrens allowences
As long as my taxes are going to pay unsustainable pensions
As long as my taxes are going to pay ps wages
As long as my taxes are going to give nearly 200 squid to an unemployed person
As long as my taxes are going to Refugees
As long as my taxes are going to banks

I dont see why they should not go to help people who are paying mortgages..

Its a demographic thing . There are well over a million people who owe money to a bank for a mortgage and who are struggling..I do not see the difference

REXER

:rolleyes:Great, lets all agree on the current low values of the houses and if/when the prices start to rise again, any increase in value over the agreed value can be scooped off the top as property capital gains tax! All of it!:mad:

Boskowski

The problem is - as you pointed out very well - we're pissing money away (that we don't have) as it stands.

I always thought it would be common knowledge that a mortgage must be paid back. How come lately some people have this expectation that - 'ah sure aren't we all together in this awful recession' - this should be suspended?

Own fault or not - this is life. Surely there should be some (temporary) support to avoid hardship but surely no one can expect to be kept in their house forever courtesy of the taxpayer.

jpb1974

yekahS wrote: »

Or how about this for a mad idea, people pay back the amount they borrowed.

And if they can't afford to pay it back - then the bank repossess the house, either can't sell it or has to sell it for a loss and the government has to cough up to provide housing for the evictee(s).

What does that solve?

BluePlanet

fliball123 wrote: »

Well let those without sin throw the first stone blah blah blah

As long as my taxes are going to unmarried mothers
As long as my taxes are going to Childrens allowences
As long as my taxes are going to pay unsustainable pensions
As long as my taxes are going to pay ps wages
As long as my taxes are going to give nearly 200 squid to an unemployed person
As long as my taxes are going to Refugees
As long as my taxes are going to banks

I dont see why they should not go to help people who are paying mortgages..

The difference is that none of those things you've listed, is the same thing as using taxpayers money to help YOU retain ownership of an asset.

jester77

I think this is a ridiculous proposal. If I was going to borrow 200k+ from a bank over 20+ years then I sure as hell would be sitting down very carefully and working out all possible permutations for what could happen during the lifetime of the mortgage. My parents tooks out a mortgage in the 70's fixed at 9.5% and variable interest rates went well above and well below that figure during the lifetime of their mortgage. I would be making sure that I could cover rates of over 10%, which is soon likely. I would also make sure that 1 person can easily cover the mortgage repayments at any one time. It is most likely that over 20+ years that one half of a couple will be out of work for an extended period, i.e. unemployment, pregnancy, health reasons, career break, etc. Possibly the 2 could be out of work, therefore you would want to have insurance or some arrangement with the bank to also cover that possibility for a short period of time. After you have worked out those sums, you should then know what you can afford to borrow.

A lot of people just went in and took out mortgages without every considering what they could afford. It shouldn't be the responsibility of other tax payers to sort out these peoples mistakes.

jpb1974

A lot of people just went in and took out mortgages without every considering what they could afford.

Actually... what a lot of people did was -

Looked at the situation they were in at the time
Had reason to feel secure in their jobs
Felt they could afford the mortgage
Had no knowledge that a Global Credit crunch was lurking in the shadows
Had no knowledge that the Irish economy was going to fall as flat and hard on it's arse as it has

And thus opted to take out a mortgage.

Not everyone had a crystal ball at their disposal. You know if everyone planned only for the worst then it's possible that very few would have homes.

danbohan

jpb1974 wrote: »

Actually... what a lot of people did was -

Looked at the situation they were in at the time
Had reason to feel secure in their jobs, ( where in the world are jobs 100%secure ?)
Felt they could afford the mortgage (did people really think that mortgage rates could not reach 9% + , remember they were at that level as recently as 1999)
Had no knowledge that a Global Credit crunch was lurking in the shadows( always prepare for the unexpected )
Had no knowledge that the Irish economy was going to fall as flat and hard on it's arse as it has ( a little look at the irish economy with 500k people employed in construction would tell anybody it was a bubble)

And thus opted to take out a mortgage.( which with interest rates at only 5% they find they cant afford and want the taxpayers to pay for their mistakes )

Not everyone had a crystal ball at their disposal. You know if everyone planned for the worst then it's possible that very few would have homes.

whats needed is not a bail out of people who cant repay their mortgages, but a change to the bankruptcy laws and the end to banks following for people the balance on repossessed homes

jpb1974

Aye... something that is both constructive and fair is what's needed.

I don't agree that the debt should be written off... but some sort of agreement/arrangement needs to be put in place to take pressure of the needy and give them a reasonable amount of time in order for the economy to recover and employment to be found. (I know that changes are happening in this regard)

I doubt many people want to be sitting in this black hole and I believe that they'd be happy to pay their mortgage... finding work is the hard part for many of them... for others significantly less take home pay is a big problem.

bmel

Hi, Would appreciate your opinion on my current situation. I am a foreign national came here about 5 years ago with my family. We bought a house 4 years back and untill now we have been paying the mortgage without fail, though I had lost my job 3 years back (can't get another one due to many reason like work permit restrictions and no job situation). It is on my wife's income(about 2600/month) we were managing since then. Our mortgage itself is about 1070 plus the life insurance 70 Euro. Another 1% interest hike will be added from this month (about 160 euro/month). WE have some personal loans of about 550 Euros (taken for car, etc).

We approached the bank to give a holiday kind of package so that we could have some money for a vacation to our home country. They seem to turn down our suggestions. In the form they gave us to list down the expenditures, we mentioned 800 euros/month for food(for a 4 member family, including 2 children) and he was telling us that was too much.
Now the point is , I am unable to cope up with this depressive state, have started medication for blood pressure and stomach acidity, all because of the stress I am living through. I am just 36, but dunno how my life will be directed in the current situation. At one point I might go back to my country for the sake of my children, for them to have a proper life. I know I am on negative equity but what am I supposed to do. I know at one point in the near term I will crash down.
Guys, any suggestions for me?

BluePlanet

Sell your house and accept the lose of negative equity.
Right now you are tied to a sinking ship.

Get rid of the house and live in a cheap apartment or rental.
You'll still owe the bank the difference but at least your debt won't be big as it currently is. Once you accept some cutbacks in your budget (like not taking a holiday and shopping at Aldi), you may find the debt servicable.

Monty Burnz

citizenofeire wrote: »

I am not asking to be bailed out, nor am I asking to have my mortgage paid off for me.

I am asking for leglisation to be introduced to stop re-possession of the homes of those who are making an effort to pay what they can from their reduced income.

So they should be allowed, at the cost of taxpayers, to hold onto an asset that they don't own?? :eek:

Dempo1

bmel wrote: »

Hi, Would appreciate your opinion on my current situation. I am a foreign national came here about 5 years ago with my family. We bought a house 4 years back and untill now we have been paying the mortgage without fail, though I had lost my job 3 years back (can't get another one due to many reason like work permit restrictions and no job situation). It is on my wife's income(about 2600/month) we were managing since then. Our mortgage itself is about 1070 plus the life insurance 70 Euro. Another 1% interest hike will be added from this month (about 160 euro/month). WE have some personal loans of about 550 Euros (taken for car, etc).

We approached the bank to give a holiday kind of package so that we could have some money for a vacation to our home country. They seem to turn down our suggestions. In the form they gave us to list down the expenditures, we mentioned 800 euros/month for food(for a 4 member family, including 2 children) and he was telling us that was too much.
Now the point is , I am unable to cope up with this depressive state, have started medication for blood pressure and stomach acidity, all because of the stress I am living through. I am just 36, but dunno how my life will be directed in the current situation. At one point I might go back to my country for the sake of my children, for them to have a proper life. I know I am on negative equity but what am I supposed to do. I know at one point in the near term I will crash down.
Guys, any suggestions for me?

I genuinely sympathize with you and your situation is not an exception to what is going on around the country right now. What is critical is insuring you communicate your circumstances and in writing, I assume your with PTSB and they are required to meet with you to discuss your circumstances, equally they are obliged to offer you a number of options, in particular an interest only payment period, reviewed every six months. You must at all times communicate with your lender and immediately inform them in writing about your situation, the normal practice is for them to arrange a meeting at your local branch, they will go through your statement of means etc. To be honest any mention of holidays etc is not advisable, this is not the banks concern. Again, PTSB must adhere to the mortgage resolution process. Take a look at this site http://keepingyourhome.ie/

Monty Burnz

sollar wrote: »

Consider it a form of welfare. People make bad decisions in life and sometimes need help.

Fair enough, but why should they benefit from their bad decisions?

Bad decision - buy overpriced property during bubble
Consequence - keep house

Good decision - avoid buying overpriced house during bubble
Consequence - pay extra taxes to pay for the other guy's house, still don't own a house

Fair?

bmel

I wish if things worked out that way. But the banks will not agree for a short sale. I am sure the negative equity will be about 50k to 60K atleast.
Thats a huge money to be paid off! may be a life time debt! As a foreign national I am not eligible for any sort of unemployment benefit/assistance also. So I don;t have anything to hang on to!

Monty Burnz

Dob74 wrote: »

[/B]So being spiteful towards people who did will help.
The taxpayer has bailed out the lenders.
Just change the law so no one has to pay back more than the house is worth.
That would end banks driving the price of houses.

BUT WHO PAYS FOR IT??

Seriously, you'd think by this stage in the game everyone would have informed themselves of the basic economics involved, but no - every time this comes up people advocate forcing the banks to take losses, the magical money tree solution.

Dempo1

BluePlanet wrote: »

Sell your house and accept the lose of negative equity.
Right now you are tied to a sinking ship.

Get rid of the house and live in a cheap apartment or rental.
You'll still owe the bank the difference but at least your debt won't be big as it currently is. Once you accept some cutbacks in your budget (like not taking a holiday and shopping at Aldi), you may find the debt servicable.

Very constructive, get rid of the House, hmmm thats going to be easy. Complete nonsense.

Monty Burnz

hinault wrote: »

The lending institution, before issuing the loan to the mortgage applicant, sends a valuer around to the property to assess it's value before approving a loan to a mortgage applicant.

So the lending institution carries some level of culpability when it valued a property in 2006 at 50% more than it's current value in 2011.

Nonsense. They were valuing what it was 'worth' in 2006 - not 2011. Are they supposed to have crystal balls? If it wasn't worth that much, why would somebody jump through all the hoops and get themselves in enormous debt to pay that much?

Padraig Mor

jpb1974 wrote: »

Actually... what a lot of people did was -

Looked at the situation they were in at the time
Had reason to feel secure in their jobs
Felt they could afford the mortgage
Had no knowledge that a Global Credit crunch was lurking in the shadows
Had no knowledge that the Irish economy was going to fall as flat and hard on it's arse as it has

And thus opted to take out a mortgage.

Not everyone had a crystal ball at their disposal. You know if everyone planned only for the worst then it's possible that very few would have homes.

Yes, but these people could also have taken steps to protect themselves in the event that their mortgage stopped being affordable. I have a mortgage but, as my job is contracts, I pay income protection insurance. This will pay me €2000 a month if I lose my job which, together with social welfare, will allow me to keep up with the mortgage, bills, etc. This insurance now costs me over €200 a month - €200 that I'd love to spend on drink, holidays, whatever, but which instead I use to help protect my family if the unexpected happens. What stopped these people taking out similar protection or, heaven help us, saving a little?

Monty Burnz

fliball123 wrote: »

Well let those without sin throw the first stone blah blah blah

As long as my taxes are going to unmarried mothers
As long as my taxes are going to Childrens allowences
As long as my taxes are going to pay unsustainable pensions
As long as my taxes are going to pay ps wages
As long as my taxes are going to give nearly 200 squid to an unemployed person
As long as my taxes are going to Refugees
As long as my taxes are going to banks

I dont see why they should not go to help people who are paying mortgages.

So, by your logic, we should also bail out the shareholders of the banks who thought they were being properly run and regulated? And those who lost money on Eircom? And those who failed to buy Microsoft shares in 1979? And those who lost down at the racecourse?

Just because some money has already been wasted, doesn't mean it's somehow right to waste evern more. Bizarre logic.

Monty Burnz

jpb1974 wrote: »

And if they can't afford to pay it back - then the bank repossess the house, either can't sell it or has to sell it for a loss and the government has to cough up to provide housing for the evictee(s).

What does that solve?

1. It means prices will fall to more realistic levels
2. It means that those who do not have property might be able to get some
3. Those who are sitting in property not paying their mortgages are ALREADY in social housing
4. Many of those who can't pay their mortgage may well be able to pay rent on a similar propery. Why should the government have to pay it for them if they can?

Monty Burnz

jpb1974 wrote: »

Not everyone had a crystal ball at their disposal. You know if everyone planned only for the worst then it's possible that very few would have homes.

No - probably a very slightly smaller number would have much more affordable homes if people weren't bidding up prices in a frenzy like we saw a few years ago.