The Curse of Defective Concrete (Mica, Pyrrhotite, etc.) in Donegal homes - Read Mod warning Post 1

ahusband

https://www.boards.ie/discussion/comment/118267566#Comment_118267566

Would I be happy to get a guaranteed return of 100% of the purchase price of my house were it now rendered worthless bar the value of the land?

Absolutely without a doubt I would be, I'd happily take that, clear the mortgage and use the equity leftover to move on.

In the interest of clarity, my house is worth a fair bit more than the purchase price and has been for a long time.

The only relevant figures are cost (being purchase price) or net realisable value & it should be the lower of the two figures, you are only in for how much you spent.

ahusband

https://www.boards.ie/discussion/comment/118268126#Comment_118268126

Definitely not the banks fault.

Did the bank hold a gun to your head and tell you to take the mortgage out or did you make that decision yourself?

Where has personal responsibility gone?

If your property was not worthless would you share a profit with the bank, of course you wouldn't, they got the interest on the payments didn't they....

Penfailed

https://www.boards.ie/discussion/comment/118270845#Comment_118270845

You are not an honest poster. Obviously you've tried to put yourself in my position and you haven't been able to. That's fair enough. It's impossible unless you're in this shíte.

"You are only in for what you spent." That's only one blinkered way of looking at it. I had a perfectly good house. Now I don't. I would like my perfectly good house back.

Penfailed

https://www.boards.ie/discussion/comment/118270861#Comment_118270861

Okay, definitely not the banks. Happy?

NIMAN

Although the banks aren't to blame, they are keeping every house affected in their books at it's original mortgage amount/value.

So in theory they are fudging their figured. They own the properties until the mortgage is paid off, and at present the houses really only have site value until they are fixed.

So they are involved in all this.

Penfailed

https://www.boards.ie/discussion/comment/118271570#Comment_118271570

Yeah. You've posted what I wanted to but I've lost the will to respond to 'ahusband' a little bit.

dzer2

https://www.boards.ie/discussion/comment/118271570#Comment_118271570

Not really,

If you borrow from a bank to buy a car for x amount with an agreed repayment of y. When you have repayed it the bank don't care what the car is worth. It's the same with the house you bought on a mortgage. It's really hard on you when what you have spent your money on turns out to be a lemon bit it's still not the banks fault.

John_Rambo

https://www.boards.ie/discussion/comment/118249792#Comment_118249792

Just wondering about this. Do holiday home owners have the support of the protesters & lobbyists?

John_Rambo

https://www.boards.ie/discussion/comment/118274298#Comment_118274298

Ah come on... A home is a different scenario than a car. Anyway, if it was Audi or Ford and all their cars had a serious defect in them there'd be a recall. We've all seen this happen, the car goes to the garage and the fault is amended, or the part is replaced, car is valeted and returned.

dzer2

https://www.boards.ie/discussion/comment/118274353#Comment_118274353

Being honest this defect doesn't appear inside the 5 yr rule. But again the house can't be recalled. Again not all house's in Donegal have this defect. The faulty blocks as far as being proven come.from the one supplier. Until this was proven the banks had no evidence to pull a mortgage on a house for faulty blocks.

Where I come from there are certain sand pits that the blocklayers specify the sand is got from and then the plasters have a different one.

John_Rambo

https://www.boards.ie/discussion/comment/118274407#Comment_118274407

I know a house can't be recalled, that's why I called you out on the car comparison. This isn't a time for silly analogies, these are peoples homes, the biggest spend any normal person has in a lifetime leaving aside the natural emotions we have with our homes.

NIMAN

https://www.boards.ie/discussion/comment/118274298#Comment_118274298

Sorry but got to dispute this.

For example, say I have a mortgage of 200k with a bank. The house is discovered to have mica. It is basically worthless as a property, unless it it fixed, as it will eventually crumble and fall down.

But the bank continues to tell the Central bank that my property is worth 200k, when it isn't.

Of course you could say as long as I keep paying my repayments on 200k, that they will get their asset fully paid for.

But if I decide to default, they take property off me, and will continue to claim it's worth 200k, which is it simply isn't.

That's the point I'm trying to make.

ahusband

https://www.boards.ie/discussion/comment/118271570#Comment_118271570

Interesting, please explain your gripe in this regard?

Is it that the bank are actually continuing to look for the balance of the money borrowed? Heaven forbid that they should do such a ghastly thing, its an absolute disgrace that they should expect or have the audacity to think you should repay the price you agreed for them to pay on your behalf, shocking.

You should run with this, yes, 100% redress, no less, plus a debt writedown from the nasty banks.

We all know that when a property increases in value we have to pay the bank more than borrowed, because well its worth more now and belongs to them.

ahusband

https://www.boards.ie/discussion/comment/118271539#Comment_118271539

No you didn't, you bought a defective house cheaply and now want a non defective house regardless of the cost without being willing to accept that part of the ultimate cost must sit with the benefactor.

muffler

https://www.boards.ie/discussion/comment/118275555#Comment_118275555

@ahusband You can make your point without the petty sarcasm. No more please.

ahusband

https://www.boards.ie/discussion/comment/118275624#Comment_118275624

Bringing unrelated parties such as the banks that lent the money into it is petty, calling it out for being what it is is being realistic.

I just highlighted now patently absurd it is to blame the banks, its fairly difficult to do so without it coming over sarcastically.

My objective was to highlight the stupidity of the argument against the banks, which I think I achieved.

jj880

Banks are not just looking for the "balance of the money borrowed" as you put it. They charge interest to make profit and use the value of their loan book to borrow themselves.

Many home owners have tried to borrow to make up for the costs not covered in this scheme but the banks wont even approve the loan because the defective block house is worthless and they know it. However the real valuation only applies when its the homeowner looking to borrow.

No-one is blaming banks for defective blocks here. However it cant be denied they are profiting and inflating the value of these homes when it suits them and refusing to help the home owner in any way.

dzer2

https://www.boards.ie/discussion/comment/118274633#Comment_118274633

The banks can't afford to write down the value of your house. Even if you default the bank gets the house they will come after you for the rest of the money. It's basically nothing to do with the bank. They set their rules got the engineers reports got your credit history. They have done everything to make sure that you are a sound investment and gave you a loan on this. Even though your house is falling down they would still give you a loan for a car if your credit history is good. And you are up to date on the repayments.

95 % of your house is up to regs, the windows are fine the carpentry is fine the plumbing fine as long as the walls don't break the pipes. The electrics are fine.

Anyway that don't fix the problem. I know the blocks crumble when moisture gets into them, and some of the houses are basically F**Ked. But of the ones that are least effected at the moment survive, if a water proof membrane was added to the outside with another layer of insulation and then skimmed.

Penfailed

https://www.boards.ie/discussion/comment/118275569#Comment_118275569

My house wasn't cheap.

Penfailed

https://www.boards.ie/discussion/comment/118274324#Comment_118274324

I'd imagine so. They've repeatedly stated, "no one left behind." I think they will be left behind though.

muffler

The council meeting today will discuss the mica issue.

NIMAN

https://www.boards.ie/discussion/comment/118275852#Comment_118275852

Re: your very last line.

Do you not think all the engineers have thought of that idea?

If it was as simple as that for most of the houses affected, why do you think the government scheme is costing this at €2.2bn?

givyjoe

https://www.boards.ie/discussion/comment/118275685#Comment_118275685

Banks are most certainly related parties. What do you think would happen if affected homeowners weren't given proper redress or one that didn't cover the cost of the problem. They'd be forced to walk away and hand the keys back.. what do you think would happen to banks faced with hundreds/thousands of defaults in quick succession? Defaults on properties with next to no value with little or no means for the bank to make their money back, or at best, take a massive hit to offload land with derelict/dangerous houses on it? And if not the banks, insurance companies? Same question applies to them, how on earth would they be able to absorb the losses arising from claims.. Then what about the company responsible, well as a limited company, there's no point in chasing them or their directors as they don't have billions in their back pocket. The only ones with the means to resolve the problem is the government/tax payer. Why oh why people keep going round and round in circles on this, is baffling.

Honestly, some people can't see past of the end of their own nose. Not a donegal resident, or homeowner.. yet.. but I'm continually astounded by the shortsighted, god awful and callous posts in here from some people. It's borderline disturbing.

dzer2

https://www.boards.ie/discussion/comment/118276812#Comment_118276812

I have no idea what the engineers have thought about. I do know that anything they do is expensive and also the are a paid piper in this.

I am suggesting that at least try something. When cladding with stone walls are treated for damp proof, then insulation and then stone.

ahusband

https://www.boards.ie/discussion/comment/118277850#Comment_118277850

There is no such thing as handing the keys back and walking away as there might be in other countries, but not here, the outstanding debt after the sale of the property is still the person / persons to deal with.

They are of course related, in that they have a vested interest in their investment, but to blame the banks for the problem is little short of insanity.

salonfire

https://www.boards.ie/discussion/comment/118277874#Comment_118277874

The inside walls are crumbling too though which suggests damp proofing would not work.

ahusband

https://www.boards.ie/discussion/comment/118275906#Comment_118275906

50 % of the cost to replace would suggest it was cheap relative to its cost to replace.

I did say that you bought it cheaply, which given the cost to replace (a cost which does not include the land) you did indeed buy it cheaply.

Compare the cost of buying the site and doing a build from scratch, come back and tell me which is cheaper.

I've friends who bought in Donegal and relocated there specifically because the houses were cheaper, they were definitely happy they bought cheaply.

ahusband

https://www.boards.ie/discussion/comment/118275808#Comment_118275808

You borrow money, you pay interest on the outstanding balance, there is no reason at all that I would mention that as that is simply how credit works.

They are charging interest on the outstanding balance of the loan, the actual value of the asset is irrelevant in the calculation of the interest due with the possible exception of a tracker / rate based on the LTV of the loan, but this would only serve to increase the interest applied due to the higher LTV ratio.

Unless you have audited the books of the banks you have no idea how they are treating the mortgages on their books, they may well be classed as impaired loans, the assertion that people have difficulty in obtaining additional credit on them would suggest that to be the case.

Penfailed

https://www.boards.ie/discussion/comment/118281541#Comment_118281541

I repeat, my house was not cheap and I didn't buy it cheaply.

givyjoe

https://www.boards.ie/discussion/comment/118281492#Comment_118281492

You specifically said banks are unrelated parties.. they quite clearly are a related party. I dont recall seeing anyone 'blaming' banks. They should be just as worried as the homeowners, as they have a charge over an essentially worthless asset. With no redress, families would obviously be eventually forced into defaulting on the mortgage. You can pretend that wouldn't be the case if you wish, but it's a choice many would be forced to make, i.e. either rent a liveable/safe home, or continue to pay a mortgage on their current crumbling/unsafe house.