Do people need full pay in this environment?

namloc1980

Pkiernan wrote: »

If it helps to keep jobs in the private sector and lowers the tax bill for public sector workers, do we really need to keep pay levels at full pay?

Noones going on holidays, to the pub, buying cars etc.

Inflation will be zero and fuel costs are down. Couple that with mortgage and rent holidays, we simply don't need full pay (private, public or welfare) at this time.

If anything heating and electricity bills will be going up for some people who are now at home all day and using more utilities than an average weekday. Housing still has to be paid for. Only saving for some people will be reduced transport costs.

arctictree

When the banks say that they are allowing people have a payment freeze on the mortgage, are they still adding up interest over this period?

bladespin

namloc1980 wrote: »

Only saving for some people will be reduced transport costs.

Mine will actually go up lol.

namloc1980

arctictree wrote: »

When the banks say that they are allowing people have a payment freeze on the mortgage, are they still adding up interest over this period?

Yes

Sultan of Bling

Idbatterim wrote:

people should only be allowed defer mortgage, if their job circumstances have changed, the money to prop up banks now will have to come from the taxpayer I assume, what kind of idiocy would it be, to have people who's circumstances havent changed and the taxpayer, supporting the amount the banks are out

The taxpayer is already propping up the banks. That's what the USC deduction in your pay packet is every week and pension levy if you are a public sector worker.

Sultan of Bling

Sultan of Bling wrote: »

The taxpayer is already propping up the banks. That's what the USC deduction in your pay packet is every week and pension levy if you are a public sector worker.

....... all the more reason for those who can pay their mortgage and rent to continue doing so.

tom1ie

mariaalice wrote: »

If you have a mortgage or renting they are.

How is the mortgage reducing?
You do know interest is accrued even if you don’t have to pay your repayment.
In other words the bank aren’t out of pocket they just collect more money along the term of the rest of the mortgage.

mariaalice

tom1ie wrote: »

How is the mortgage reducing?
You do know interest is accrued even if you don’t have to pay your repayment.
In other words the bank aren’t out of pocket they just collect more money along the term of the rest of the mortgage.

It is a paused for 3 months which will allow a brake untill people go back to work, its better that nothing I dont think its the correct approach but I am not the government.

We also need people to have money so they can spend with this is all over and it will be over sometime.

Sultan of Bling

Augeo wrote:

....... all the more reason for those who can pay their mortgage and rent to continue doing so.

Agree 100%

Tough times ahead though. I imagine there will be an emergency budget called. Austerity, here we come.

The next public sector pay restoration due in October (I think), under the Haddington road agreement will be reversed.

namloc1980

namloc1980 wrote: »

Say €200k mortgage at 3.5% would be interest over 3 months of €1,750.

I think this is a big issue that's being glossed over. The banks are not 'helping' anyone here - the principal amount owed staying higher for the period you're not paying it is actually making your mortgage more profitable to them.

No one seems to be picking up on this for some reason. If they froze interest, they'd be helping you out.

JoeA3

My understanding of the mortgage "holiday" situation is that it really doesn't cost the bank anything. They're not "bailing" anyone out thats for sure! And its nothing new, mortgage payment deferrals have always been there for people to avail of in certain circumstances. They even offer them to first time buyers for example, when starting off, to give them a chance to move in and pay the first few new bills...

If your current mortgage repayment is lets say 1,000 per/month and you take 3 months off - that 3K you didn't pay in that period is spread out over the remaining term of your mortgage. So come July/August, whenever your "holiday" ends, your monthly repayment will be increased slightly. It might be less than 50 a month, but it'll be there.

JoeA3

JoeA3 wrote: »

whenever your "holiday" ends, your monthly repayment will be increased slightly. It might be less than 50 a month, but it'll be there.

I don't think that's how it's being done - i think the term is extending, rather than the payment increasing.

JoeA3

Deleted User wrote: »

I don't think that's how it's being done - i think the term is extending, rather than the payment increasing.

It might vary from bank to bank or indeed from borrower to borrower, whether they add on 3 months to the end of your term or they spread the 3 months over your existing term - you will eventually repay them back the same thing, holiday or no holiday, regardless.

witchgirl26

JoeA3 wrote: »

My understanding of the mortgage "holiday" situation is that it really doesn't cost the bank anything. They're not "bailing" anyone out thats for sure! And its nothing new, mortgage payment deferrals have always been there for people to avail of in certain circumstances. They even offer them to first time buyers for example, when starting off, to give them a chance to move in and pay the first few new bills...

If your current mortgage repayment is lets say 1,000 per/month and you take 3 months off - that 3K you didn't pay in that period is spread out over the remaining term of your mortgage. So come July/August, whenever your "holiday" ends, your monthly repayment will be increased slightly. It might be less than 50 a month, but it'll be there.

The problem the banks have with offering a blanket "holiday" is less about monetary impact on them but mainly around putting them in breach of their conditions of lending from the Central Bank etc. Usually there wouldn't be as many people looking for a break from payments at the exact same time so it wouldn't impact their loan book to the same degree. As for first time buyers, they've often factored in that initial break when they were offering the loan and ensured it wouldn't impact the loan book.

That's why it took a little bit to get it sorted as it wasn't just on the banks to say "ah yeah go for it" but rather getting the regulatory authorities to allow the banks to alter loan books to that degree without incurring fines themselves.

pwurple

Bills dropping?

Parents have each had to set up bloomin' schools in their houses for children. Printers, internet connections and laptops. Books, ink. Heat the house while they are in it. You know, all the stuff we pay schools to do as well from our taxes. There are 1 million children in the state, no longer in school or creche.

JoeA3

witchgirl26 wrote: »

The problem the banks have with offering a blanket "holiday" is less about monetary impact on them but mainly around putting them in breach of their conditions of lending from the Central Bank etc. Usually there wouldn't be as many people looking for a break from payments at the exact same time so it wouldn't impact their loan book to the same degree. As for first time buyers, they've often factored in that initial break when they were offering the loan and ensured it wouldn't impact the loan book.

That's why it took a little bit to get it sorted as it wasn't just on the banks to say "ah yeah go for it" but rather getting the regulatory authorities to allow the banks to alter loan books to that degree without incurring fines themselves.

Ah yeah, thats fair enough. I can well imagine it wasn't as simple as flicking a switch.

Thelonious Monk

What about civil servants at home doing nothing as they don't have the provision to work from home and are being advised not to come in? This is all unprecedented but sooner or later we're all going to have to take massive cuts to help out.

Fann Linn

Thelonious Monk wrote: »

What about civil servants at home doing nothing as they don't have the provision to work from home and are being advised not to come in? This is all unprecedented but sooner or later we're all going to have to take massive cuts to help out.

I think a lot of them are being redeployed to contact tracing, sw etc

Idbatterim

unless things can come back to some sort of middle ground in a few weeks, there will be big financial issues!

The way I see it is, you could get the older and more at risk to isolate. even those older people working in say retail like supervalu, pubs, deli's etc etc, its not like there wont be young people lining up now for those positions.

Lurching

mariaalice wrote: »

How much is three months of interest on an average mortgage? its cant be that much, however, I do not think it is not the correct response there should have been one month pause of all rent, mortgage, utilities, and then reassess for everyone who has been let go.

€1,687. Why would I pause my mortgage when I'm still working as normal and earn every penny I get?

Doctor Nick

I work in a small company of 11 people. Three of my colleagues are off because of the current situation. I'm doing their work in addition to my own. I do of course expect my full pay next week.

Deeper Blue

I'm working from home but I'm working just as hard as ever, sorry but why should I take a pay cut?

daheff

mariaalice wrote: »

If you have a mortgage or renting they are.

no they arent.

deferral isnt removing the payment.

mortgage holiday means the payment & accrued interest get added to the bill and you end up paying MORE over time.

Not surprised banks are happy to do this.

daheff

namloc1980 wrote: »

Say €200k mortgage at 3.5% would be interest over 3 months of €1,750.

Better way for you to think of this is like having your normal mortgage. you stop paying this for 2-3 months. then restart it paying it after the crisis.

But you now have another mortgage the 2-3 months payments you didnt pay.
this second mortgage accrues interest for the life of the mortgage too. But you never pay any of this mortgage until your last couple of mortgage payments (which could be extra months tacked onto the end of your mortgage).

so 3 months at 1600 (4800) missed ends up costing you 6,464 if you had to repay it over 20 years @1.5%

BarryD2

Idbatterim wrote: »

The way I see it is, you could get the older and more at risk to isolate. even those older people working in say retail like supervalu, pubs, deli's etc etc, its not like there wont be young people lining up now for those positions.

I'd be thinking that's the way it will pan out. Once a few weeks have passed and we can see the nature of the beast and a good few people have had the dose, there'll be a move to get these back to work whilst advising those older and compromised to sit it out a while longer. Not going to be easy for anyone though.

LeeroyJ.

Most of my Salary is used on rent so If it was cut I would have just barely enough to live off of and nothing to save.

pwurple

pwurple wrote: »

Bills dropping?

Parents have each had to set up bloomin' schools in their houses for children. Printers, internet connections and laptops. Books, ink. Heat the house while they are in it. You know, all the stuff we pay schools to do as well from our taxes. There are 1 million children in the state, no longer in school or creche.

Tough times.

mariaalice

Lurching wrote: »

€1,687. Why would I pause my mortgage when I'm still working as normal and earn every penny I get?

What an odd comment, Yes why would you? this is aimed at thsoe who have been laid off.

We are both working away I feel very sorry for those who have been suddenly oadi off.

Thelonious Monk

Maybe we should be paying some people more. White van men, cleaners, shop workers... I hope people don't look down at the actual people who old the country together after this crisis.

trumptheman

Thelonious Monk wrote: »

Maybe we should be paying some people more. White van men, cleaners, shop workers... I hope people don't look down at the actual people who old the country together after this crisis.

Why exactly? Not trying to be smart here but I could probably do the job after a week of training?

Also just want to add I say a lot of people with new cars really now regret getting them.