Do you personally know anyone who.

swampgas

Drumpot wrote: »

I don't believe necessarily in debt forgiveness, but I do believe in the concept of banks having to writedown bad loans.

but also

Shame that the government will prob drag its feet for years, taking the ill advised view of some here, that we cant be seen to be letting people off their financial responsibilities

Debt forgiveness IS letting people off their financial responsibilities. You can't have it both ways.

I have no problem with debt restructuring, or debt for equity swaps - where appropriate - i.e. on the principal private residence maybe - but there is no way I can agree to writing off debts while allowing people to keep 100% of the equity or where there are multiple properties involved.

Monty Burnz

swampgas wrote: »

I have no problem with debt restructuring, or debt for equity swaps - where appropriate - i.e. on the principal private residence maybe - but there is no way I can agree to writing off debts while allowing people to keep 100% of the equity or where there are multiple properties involved.

But if you've no equity in your home, how exactly do you do a debt for equity swap?

Drumpot

Spiritofthekop wrote: »

Yeah while we are at it we might as well "right off all the car loans, holiday loans, loans for extensions, loans for new kitchens, loans for another car, loans for my girlfriends new pair of ####, the list goes on & on its because of these loans that banks gave out wily nilly to people who could not afford them in the first place is the exact same as giving massive home loans to people.

I bought my fancy Lexus Jeep with a bank loan of 35,000 the car is now worth bugger all can i get my car loan written off please and can i hold on to my lovely lexus jeep?....no why not? ....can the tax payers not pay for it for me?.....

This post highlights exactly what happens in all these debates - Public service, debt forgiveness, social welfare fraud etc . . One example used in a ragnewspaper style to start off the debate like everybody in arrears basically bought sh*t for the sake of it . . Its such a narrow minded argument view, that it generally ruins any chance of proper objective debate.

If the banks werent state run nobody would care if they had to write off these loans . . The way a capitalist system works is that the risk was taken on by the bank and they have to make a profit or a loss based on their decision.

The government chose to nationalise the banks, I dont see anymore obligation of the person with the loan to pay back the bank just because its state run . . I dont believe the taxpayer should of had to foot the bill of the banks, but they did and that includes the people who are struggling to repay loans/mortgages.

No matter how you spin it, we have already paid for the writedowns of whatever loans will not be paid. No amount of ragtag examples will change that and no amount of moaning will make the problem go away . . Perhaps actually approaching the subject/problem in an educated balanced manner would do more then simply putting our heads in the sand and giving the two fingers to people struggling !

Drumpot

swampgas wrote: »

but also


Debt forgiveness IS letting people off their financial responsibilities. You can't have it both ways.

I have no problem with debt restructuring, or debt for equity swaps - where appropriate - i.e. on the principal private residence maybe - but there is no way I can agree to writing off debts while allowing people to keep 100% of the equity or where there are multiple properties involved.

I am arguing the wording . . I dont believe in the phrase "burning the bondholders" , its people taking losses on their investments . .

Likewise I dont believe in the wording "debt forgiveness" either. Its another propaganda phrase used to stoke the emotions . . Its banks writing down bad loans, there is a differance.

People keep putting emotional attachments to basic economic principles and its wrong . . People speaking of the taxpayer "bailing out homeowners" etc is only serving to highlight how uneducated they are on the topic . . Its banks writing down loans , plain and simple . . The fact that the taxpayer owns the banks just makes people upset and unable to objectively debate the topic.

Monty Burnz

Drumpot wrote: »

If the banks werent state run nobody would care if they had to write off these loans . .

The bank shareholders were wiped out by the mismanagement of the banks they owned. All their capital is gone. Now it's the citizens' money on the table, due to the stupidity and cowardliness of Fianna Failure. Are you surprised that your fellow citizens (who may already have had pensions/shareholdings wiped out by the collapse of the banks) don't want to be scalped again?

I note that you haven't contributed to the thread I started asking for debt sharing advocates to outline exactly how it would benefit the economy.

Drumpot

Monty Burnz wrote: »

Unfortunately for the 'please Irish public, pay my debts for me' crowd, there isn't a single shred of economic evidence that sharing the debts will do anything for the economy. Not a single shred.

So we'd just get loads of free-loaders having a free ride, and everyone else poorer to pay for it.

And wheres the evidence to suggest that we would get a load of freeloaders or that it would have a negative effect? It works both ways . .

Do you think that part of the problem with recapitalisation of the banks has been knowing where the bottom of the problems are ? Do you not think that a big part of these problems is the potential arrears and mortgage defaults down the road ?

With unemployment at the current rate and no clear end to the world recession/depression, how do you think things are going to play out in term of people being unable to pay back their debts ?

That aside, how much are the 15,000+ homes on mortgage interest supplement costing the state ?

Monty Burnz

Drumpot wrote: »

And wheres the evidence to suggest that we would get a load of freeloaders or that it would have a negative effect? It works both ways . .

You think a get out of jail free card for those who claim not to be able to repay will not bring hoards of freeloaders out of the woodwork? That's astonishingly naive, or simply arguing in bad faith.

Drumpot wrote: »

Do you think that part of the problem with recapitalisation of the banks has been knowing where the bottom of the problems are ? Do you not think that a big part of these problems is the potential arrears and mortgage defaults down the road ?

No. The problem with the recapitalisation is that it should never have happened.

Drumpot wrote: »

With unemployment at the current rate and no clear end to the world recession/depression, how do you think things are going to play out in term of people being unable to pay back their debts ?

Many won't be able to repay. They should go through a streamlined, modern bankruptcy procedure (which is in the works) and have their debts cleared that way. They don't get to keep the assets they borrowed against, of course. That would be ludicrous.

Drumpot wrote: »

That aside, how much are the 15,000+ homes on mortgage interest supplement costing the state ?

A helluva a lot less than paying the equivalent of mortgage interest supplement on hundreds of thousands of houses indefinitely would.

swampgas

Drumpot wrote: »

I am arguing the wording . . I dont believe in the phrase "burning the bondholders" , its people taking losses on their investments . .

Likewise I dont believe in the wording "debt forgiveness" either. Its another propaganda phrase used to stoke the emotions . . Its banks writing down bad loans, there is a differance.

People keep putting emotional attachments to basic economic principles and its wrong . . People speaking of the taxpayer "bailing out homeowners" etc is only serving to highlight how uneducated they are on the topic . . Its banks writing down loans , plain and simple . . The fact that the taxpayer owns the banks just makes people upset and unable to objectively debate the topic.

There is a lot of emotion on both sides, but the facts are the same either way.

The simple fact is people want to be *given*, free, gratis, large chunks of money by the bank / state / taxpayer because they over-extended themselves financially.

In return they want to give - nothing. They want to keep 100% ownership of their property for example. This is just pure selfish greed.

If I owe you 10 grand and can't pay it, but I have a really nice car, would you not consider that maybe writing off my debt while I keep my car is a bit one-sided? Maybe I should sell the car first? Maybe I should give you the car, and hire it back from you?

Or do you think the lender should just write off the debt out of sympathy?
If so, can you lend me 10 grand? I promise to pay it back ...

Drumpot

swampgas wrote: »

There is a lot of emotion on both sides, but the facts are the same either way.

The simple fact is people want to be *given*, free, gratis, large chunks of money by the bank / state / taxpayer because they over-extended themselves financially.

In return they want to give - nothing. They want to keep 100% ownership of their property for example. This is just pure selfish greed.

If I owe you 10 grand and can't pay it, but I have a really nice car, would you not consider that maybe writing off my debt while I keep my car is a bit one-sided? Maybe I should sell the car first? Maybe I should give you the car, and hire it back from you?

Or do you think the lender should just write off the debt out of sympathy?
If so, can you lend me 10 grand? I promise to pay it back ...

Hold on. Where is the evidence to back up your highlighted bit ? That is simply your personal opinion . . Any anway, I am not promoting a "free ride" for anybody , anymore then getting social welfare should be an easy life for those on it!

Never said I agreed with debt forgiveness, I agree with banks and mortgageholders coming to a workable agreement, there is a differance. Banks took a risk giving out money, the liability is not and should not be completely with the person getting the money .

Monty Burnz

Drumpot wrote: »

Banks took a risk giving out money, the liability is not and should not be completely with the person getting the money .

Yes, and the bank owners were wiped out. Now it's the property owners' turn, no?

swampgas

Drumpot wrote: »

Hold on. Where is the evidence to back up your highlighted bit ? That is simply your personal opinion . . Any anway, I am not promoting a "free ride" for anybody , anymore then getting social welfare should be an easy life for those on it!

Never said I agreed with debt forgiveness, I agree with banks and mortgageholders coming to a workable agreement, there is a differance. Banks took a risk giving out money, the liability is not and should not be completely with the person getting the money .

Apologies if I misunderstood your position.

My reading of the term "debt forgiveness" which some of the media are pushing, and which some of the posters here are advocating, is a simple write down of someone's mortgage to somewhere near the current value of the property. That is what is generating most of the anger.

Like yourself, I have no problem with workable agreements, where the borrower loses the rights to some or all of the secured asset in return for a write-down of the loan value.

I'm not sure though that the bank should necessarily take a hit, that's a harder question to answer.

Drumpot

Monty Burnz wrote: »

You think a get out of jail free card for those who claim not to be able to repay will not bring hoards of freeloaders out of the woodwork? That's astonishingly naive, or simply arguing in bad faith.

No. The problem with the recapitalisation is that it should never have happened.

Many won't be able to repay. They should go through a streamlined, modern bankruptcy procedure (which is in the works) and have their debts cleared that way. They don't get to keep the assets they borrowed against, of course. That would be ludicrous.

A helluva a lot less than paying the equivalent of mortgage interest supplement on hundreds of thousands of houses indefinitely would.

So you dont know how much its costing the state for the 15000+ on mortgage interest supplement, you didnt have to make a presumption based on your opinion, you could of just said "I dont know how much its costing" . .

That aside, I am not promoting blanket debt forgiveness, I am promoting a prudent approach to those in difficulty, particularly with family homes as I do believe a person with a family home has a bigger motive to pay it off then a person with a rental property. If somebody cant pay, theres a differance from somebody who wont pay, this needs to be differentiated . .

And the recapitalisation happened whether any of us like it or not . . Part of the money was for this very problem, so whether we actively do something or do nothing, one way or another there will be bank losses in this area . . If you create a flimsy way of approaching the problem and make it easy for people to strategically get out of their liabilities it will happen. If the government applies themself and brings in a system that can orderly assist people/banks in coming to a fair arrangement then it will and can benefit the country . .

Monty Burnz

Drumpot wrote: »

So you dont know how much its costing the state for the 15000+ on mortgage interest supplement, you didnt have to make a presumption based on your opinion, you could of just said "I dont know how much its costing" . .

I wasn't aware you wanted a figure - I thought you were making a debating point, which I proceeded to rebut.

Drumpot wrote: »

That aside, I am not promoting blanket debt forgiveness, I am promoting a prudent approach to those in difficulty with family homes as I do believe a person with a family home has a bigger motive to pay it off then a person with a rental property.

Right. And if they can't pay, they default and go bankrupt. Same treatment for everybody - otherwise the system will be fall victim to cute hoorism and sleeveenism, Fianna Failure style.

Drumpot wrote: »

And the recapitalisation happened whether any of us like it or not . . Part of the money was for this very problem, so whether we actively do something or do nothing, one way or another there will be bank losses in this area . . If you create a flimsy way of approaching the problem and make it easy for people to strategically get out of their liabilities it will happen. If the government applies themself and brings in a system that can orderly assist people/banks in coming to a fair arrangement then it will and can benefit the country . .

Part of the money was for people defaulting and going bust. It wasn't for letting some people off and others not, with some mysterious agency deciding who fits in what group. And if you make it easier to default (by making it pretty painless) the numbers who opt to default will go through the roof - and where has all the public's recapitalisation money gone? Up in smoke. And what is required then? Another recapitalisation with more public money.

Meanwhile the schools and universities are going to pot, trolleys full of people line hospital corridors, and businesses go to the wall as the people who didn't make bad property buys are left with less and less money to spend or invest.

HellFireClub

If you are dealing with someone how did an equity release on their property and went off and bought an X5 or a Range Rover or an apartment in Alacante or Bulgaria with the cash or who remortgaged their property in order to buy these kind of assets, then by even mentioning debt forgiveness for these folks, you are only paying their obligations for them and sending them a message that greed, extravagance (that couldn't even be afforded), and more greed is ok, it's grand, because if you mess up, the taxpayer will come in under you and pay your debts for you, and this is what happens when you are entertaining the notion of debt forgiveness.

Another thing, behind all of this extravagance was a local branch manager, a "relationship manager" or some local person at branch level who signed off on this madness and arranged for the cheque to be issued. Where are these folks now, why has nobody asked these guys/girls what they were thinking when they ran with this madness, these folks were supposed to be professional conservative banking trained personnel???

SBWife

HellFireClub wrote: »

Where are these folks now, why has nobody asked these guys/girls what they were thinking when they ran with this madness, these folks were supposed to be professional conservative banking trained personnel???

You're talking about the debt product salespeople hired by the banks since 2000, right?

mrsoundie

Debt forgiveness for some of the people who went for it during the boom, I dont think so.

I remember Eddie Hobbs reading out an E mail sent to him by a lady, who had two news cars (her and hubby) still paying for (at least one was a merc), second investment property (to fund cars, lifestlye blankity blank fill in whatever you want) and huge credit card bills and she could not talk to the hubby as his business was in trouble. (I think I got the facts fairly right).

Add this in with people who rushed and were rushed, into buying property by the "rent money is wasted money brigade". I for one was lucky as I was given one quote by a builder who then upped the price by €17,000 by way of a "mistake". Nearly caught there. Now renting and by far best thing I have ever done. Can walk away any time to any where and nothing following me.

Change investment to gamble and there you go.

How long before the debt forgiveness recipients are back and flaunting there new found opulence eg cars, holidays etc.

Rant over, awaiting assualt.

SBWife

I know a couple who threw a new car in with the mortgage in early 2006. They were selling their first home and upgrading so would have had some equity, but they were stretched by the new property so I doubt they had the liquidity to put the extra "car" payments toward their mortgage.

My husband and I got married the same year and sold his property to a couple, both teachers, who were buying it as an investment property, essentially because all of their friends have done the same. An equivalent property recently sold for about €200k less then they paid. We talk about it from time to time and wonder how they are managing.

At the same time Summer 2006 we looked at properties to buy but decided to live in my small inner city home instead. Our thinking at the time was that the homes we were looking at were c.€1m and the vendors were mostly selling because there wasn't really room to have more than one child in the property. The idea of paying the amount of stamp duty that would have been charged on these properties was the real thing that put me off (although I had a hard time with the valuation as well) I'd have paid it if it was a lifetime home we were looking at but the idea of having to pay that type of tax 3 times in a lifetime took me out of the market (I purchased our current property second hand and paid stamp in 2000).

We remain in a very small home because we were prudent (and tax adverse) and I've no desire to help pay for someone elses MacMansion while I struggle to find place to fit the latest load of groceries.

Peanut2011

Everyone is talking about debt forgiveness as if the government should just write off what the people can't pay and so on... Everyone is talking about all these people in mortgage arrears as if they are all in the same boat.

We need to be realistic. There are those who did stupid things with their equity and now can't pay up, but there are those who have simply bought a family home who are struggling.

Let's face it, many are unable to pay the full value of their mortgage because they lost their jobs and now have no income. You can hardly blame these people for the way the country was run and overinflated everything and money became the solution to every problem.

Now there are a lot more of the people out there that the reason they are now behind is cause of the interest rates going up, where they have taken wage cuts. The problem in this case is that they are now no longer able to pay for the full amount the bank is asking for and every missed payment attracts extra interest.

So if a person can't pay (for the sake of the argument) €100, it is pointless saying ok, now you owe me €130. Would it not make more sense that Banks and the government sit down and agree freeze on the interest rates. Bring them down to manageable level, freeze them there and don't create further bad debt.

They need to look at this as business and not the way they are. How many businesses have reduced their prices for the clients they have cos they would still have business??? So why are the Bank's allowed to keep increasing prices while the government is taking more out of our pockets and leaving us with less and less to full-fill our obligations??

They need to start looking at the all the injections the government has given them and all the bad debt NAMA took away and start looking at their minimum operating cost. Once they figure that out they need to operate on minimum required on all loans out there and ensure money is coming in until we get out of this crises. I bet most of these loans out there now would have come to end of their life before we will get out of this debt.

Put it this way, the way we are going, especially with all the early warnings of the next budget, I am more than sure that pockets of everyone in Ireland (apart from politicians themselves) will be reduced further.

Just wait and see how many more will go to mortgage arrears!!! I can tell you now, that if the bank reversed the last 2 interest increases I would not worried about how I will pay my mortgage. I know I am on absolute limit now and I have had to cut all spending to maintain my mortgage payments.

I also know that I did not get crazy with the mortgage I got. It was got to buy a roof over my head, nothing else... But if everything continues the way it is going, I can tell you that if I do get in to arrears and nothing is done, Bank can get the house, which is worth nothing comparing to the mortgage, but I would be prepared to go to jail before I would ever pay any difference. I have no problem paying my loans back and I do believe I should but when everything (earnings, prices...) are going down, why are they making mortgages going up!

All the greed of the government, the bankers, Unions and all the other "high flyers" who only saw money as worth while object has got us in to this position. Lets face it, you don't see any of these suffering or struggling to pay their debts! :mad:

HellFireClub

I think we all know that if we had another 2 business quarter's of growth, we would be back to the same carry on.

There has been nothing learnt at all in this country, 3 years into this recession and look at the scale of the greed that is still occuring, the latest being a 700K lump sum payout to Dermot Mc Carthy, Ireland's chief yes man in the civil service.

It could have been 700,000,000 Euro he was paid, people are beyond caring at this stage, it's every man and woman for themselves.

An English example rather than an Irish one.

I worked in London - in 2005 a 25 year old trainee bought a terraced house outside London with help from his parents.

He had also bought an apartment in Budapest using a 100% mortgage in Euro.
It was never rented while I worked with him. He liked to tell us each month how much it had increased in value.

He spent a lot of his time researching penny stocks and extended his mortgage by £40,000 to invest in them.

All the time he took exotic foreign holidays, had a nice big Honda Accord etc.

I think his wife has taken over the finances now.

jackiebaron

swampgas wrote: »

Apologies if I misunderstood your position.

My reading of the term "debt forgiveness" which some of the media are pushing, and which some of the posters here are advocating, is a simple write down of someone's mortgage to somewhere near the current value of the property. That is what is generating most of the anger.

Like yourself, I have no problem with workable agreements, where the borrower loses the rights to some or all of the secured asset in return for a write-down of the loan value.

I'm not sure though that the bank should necessarily take a hit, that's a harder question to answer.

Banks should definitely take a hit. If a venture capitalist invests in a startup and that startup fails, then the capitalist loses his stake. He's taking a risk. Banks gambled with mortgage backed securities and lost the farm but were bailed out by the taxpayer. Now they stand to lose from mortgage loans that they never should have issued but they're going to squeeze the little man because after all they can do no wrong. When bankers make bad money decisions they get bailed. When Joe Public does so...."pony up, bitch!"

tsoparno

Monty Burnz wrote: »

Yes, and the bank owners were wiped out. Now it's the property owners' turn, no?

bank owners wiped out,thats the gamble they took(no sympathy at all).the taxpayers helped the banks out so why shouldn't the tax payer get a little break too.
i'm not advocating helping everyone just the geniune needy which is probably not just the unemployed there's working people out there to that need help.

Monty Burnz

jackiebaron wrote: »

Banks should definitely take a hit. If a venture capitalist invests in a startup and that startup fails, then the capitalist loses his stake. He's taking a risk. Banks gambled with mortgage backed securities and lost the farm but were bailed out by the taxpayer. Now they stand to lose from mortgage loans that they never should have issued but they're going to squeeze the little man because after all they can do no wrong. When bankers make bad money decisions they get bailed. When Joe Public does so...."pony up, bitch!"

But, as I keep repeating, the banks took such big hits already that they went bust a couple of years back. The hit has happened. The owners of the banks were totally wiped out. What we basically have now are the reanimated corpses of the banks staggering around, kept moving only by continuous transfusions of taxpayers' money.

Every cent that we take of the debts off adults who signed on the dotted line for loans of their own free will has to be matched by a new cent pumped into the zombie banks. And every extra cent that goes into one of the zombies is a cent that is taxed from the citizens, or is cut from education, health, and social welfare budgets.

Nody

tsoparno wrote: »

bank owners wiped out,thats the gamble they took(no sympathy at all).the taxpayers helped the banks out so why shouldn't the tax payer get a little break too.
i'm not advocating helping everyone just the geniune needy which is probably not just the unemployed there's working people out there to that need help.

Because you're suggesting that only some of all the people who helped out should get help. If someone did not take a loan, or if they struggle but still manage to pay it they get no help. But if they went crazy then you want to give them help?

Sorry but the bank bailout already has cost enough money as it is; throwing away more money when we got a hole in the budget of the current size is quite frankly stupid. If the budget was running a 15 billion surplus I'd consider it but with a 15 billion deficit that's 15 billion borrowed JUST to keep the budget to go +/- 0 before we're even talking about adding on yet another bailout.

Zubeneschamali

tsoparno wrote: »

the taxpayers helped the banks out so why shouldn't the tax payer get a little break too.

But you are proposing to sting the taxpayer for more cash to help folks who are in negative equity!

Monty Burnz

tsoparno wrote: »

bank owners wiped out,thats the gamble they took(no sympathy at all).the taxpayers helped the banks out so why shouldn't the tax payer get a little break too.

That's what I'm arguing for - a break for the taxpayer. Not more taxes and cuts to make up for the mistakes of others.

tsoparno wrote: »

i'm not advocating helping everyone just the geniune needy which is probably not just the unemployed there's working people out there to that need help.

We already help 'the needy'. That's what the dole, social housing and mortgage interest support are for.

Seriously, the complete lack of understanding of the basics here, and the persistent belief in the magical money tree, is quite depressing. If I saw it on After Hours, I'd laugh, but on the Economy board, it makes me want to cry.

tsoparno

Nody wrote: »

Because you're suggesting that only some of all the people who helped out should get help. If someone did not take a loan, or if they struggle but still manage to pay it they get no help. But if they went crazy then you want to give them help?

Sorry but the bank bailout already has cost enough money as it is; throwing away more money when we got a hole in the budget of the current size is quite frankly stupid. If the budget was running a 15 billion surplus I'd consider it but with a 15 billion deficit that's 15 billion borrowed JUST to keep the budget to go +/- 0 before we're even talking about adding on yet another bailout.

look guys none of us have the answer's and everyone's got good valid points from each angle.jeez ye're even beginning to change my mind but i'm defo not saying help the crazy one's.i didnt really over extend myself and i'm struggling but not looking for help(yet) yes the crazy one's should be burned the same as the banks should have been.

280special

Loads of this kind of stupidity was going on;

One friend couldnt see the mind blowing stupidity of getting "extra" money out to buy a car when taking out a mortgage, despite being shown how it would mean paying at least three times the cost of a standard car loan's interest even if paid off quicker than planned !

Another mate went looking for a 5 year car loan but wanted to get that year's insurance out as part of it as well. When i asked him what about next year he said, ohh i will get another loan......

another eejet kept trading up his house as his missus insisted on a bigger, better house than her friends....they now have a E300k+ mortgage on something that will get E160k on a good day..and she wants to move again!!!!!

and thats not even looking at what people put on credit cards, Credit union loans.....

People need to take responsability for what they did, no one forced them to borrow money by such means, if they were dumb enough to get themselves into a mess like this they have to accept it and stop whinging .

tsoparno

Monty Burnz wrote: »

We already help 'the needy'. That's what the dole, social housing and mortgage interest support are for.
.

there's a new needy out there called the workers and if their not helped the bill for dole and social housing will be even greater.
which will be greater i don't know

jackiebaron

Monty Burnz wrote: »

But, as I keep repeating, the banks took such big hits already that they went bust a couple of years back. The hit has happened. The owners of the banks were totally wiped out. What we basically have now are the reanimated corpses of the banks staggering around, kept moving only by continuous transfusions of taxpayers' money.

Every cent that we take of the debts off adults who signed on the dotted line for loans of their own free will has to be matched by a new cent pumped into the zombie banks. And every extra cent that goes into one of the zombies is a cent that is taxed from the citizens, or is cut from education, health, and social welfare budgets.

Fair enough Monty. I just think the bank staff should all be fired and shot at dawn too. Just shareholders getting stiffed, while fair, seems inadequate :pac: