Loans everywhere!

meeeeh · 09-04-2018 12:46AM

Sensible car loan is perfectly fine if you can service it. I'm not in favour of buying a new car every couple of years but an old car can be more expensive to maintain, insure and less safe to drive. There is no point patting yourself on the back because you are not paying a loan if you suddenly end up with 5k repair cost for an old banger.

lalababa · 09-04-2018 12:46AM

beechwood55 wrote: »

That was in 2013. And that was because people were superstitious about having a car with 13 as part of the registration. So 131 and 132 came about....

No, that was just one of the excuses, the other was to spread sales throughout the year instead of Jan Feb. Otherwise it would be 140 150 .... Almost every buyer buying in January tells you all you need to know about modern Western capitalist consumerism society .

Wanderer78 · 09-04-2018 07:24AM

dxhound2005 wrote:

The good news in recent years is that there is much less debt in the country, and we are also very good at saving money.

The bad news is, in reality we now have the largest amount of debt the human race has ever experienced, and with the added 'bonus' of relative wage stagnation for a very large portion of society, there's a very good chance, the vast majority of those debts will never be paid. Yes, we are indeed paying down our debts, but life is relative, younger generations have much higher debts than older generations, and with the fact of this wage stagnation, particularly with younger generations, this is a problem for them. It's important to remember our debts are our money supply, by paying them down, we actually reduce its supply and it's 'velocity', hence terms such as 'debt deflation'. All is not well in the world of debt.

erica74 · 09-04-2018 07:40AM

I have heard ads encouraging people to take out loans for holidays, college, new cars, home improvements etc. I think this is encouraging very irresponsible borrowing and is very irresponsible lending.
Many many people have shown a poor attitude to repaying money, you'd think lending institutions would have learned this lesson.

Wanderer78 · 09-04-2018 07:45AM

erica74 wrote:

I have heard ads encouraging people to take out loans for holidays, college, new cars, home improvements etc. I think this is encouraging very irresponsible borrowing and is very irresponsible lending. Many many people have shown a poor attitude to repaying money, you'd think lending institutions would have learned this lesson.

Again banks sell debt, period, it's the fundamental basis of their business model, and as bill black says, 'behind every bad borrower, there's a bad lender'. It's also important to realise the benefits of bad lending, particularly if there's an asset involved, i.e. if the deal fails, the lender ultimately gains control of that asset.

waffleman · 09-04-2018 08:11AM

Summer In the City wrote: »

People can spend their money as they wish but for me taking a loan has to be for a necessity. I drive cars that I can afford to pay cash for, my wedding cost less than 3k, I have no debt whatsoever and I never have.

I will take a mortgage when the time is right but any other loan would have to be for a serious emergency.

Wow I thought I was doing well getting my wedding down to under 10k. And that was with a cake from tesco (3 plain bases then decorated) and a gift of 200 bottles of wine from a family friend who owns a bar and lots of other cost cutting. We were determined not to take any loans.

I also pay cash for cars. Last one I bought was 4,200 euro and is running great. Only debt we have is our home but we are half way through the mortgage (10 years in and its a tracker) and repayments are manageable compared to others my age.

I will probably just annoy myself asking this but I need to know - how did you get your wedding costs down to 3k?

LirW · 09-04-2018 08:13AM

meeeeh wrote: »

Sensible car loan is perfectly fine if you can service it. I'm not in favour of buying a new car every couple of years but an old car can be more expensive to maintain, insure and less safe to drive. There is no point patting yourself on the back because you are not paying a loan if you suddenly end up with 5k repair cost for an old banger.

The safety aspect isn't necessarily true. If you drive a high spec car that's 13 years old and well maintained it's likely to have more safety features than a new Dacia.
There are old and new cars where people didn't bother to maintain them properly unfortunately.

But if you're comfortable to maintain a car loan it's grand, the pressure behind doing it from insurance side and ads is high though.

Appledreams15 · 09-04-2018 08:23AM

LirW wrote: »

Housing is a quite unavoidable debt if you want to own or like here in Ireland the rental market is so dysfunctional. There's also the very conservative picture still that renting is for the young and students and many still don't see it as a long-term option (if the rental market would allow it).

We're spending approx. 3,5k on our day, that's what we can afford, want afford and are comfortable with. I couldn't justify a big loan for it. It's still a huge amount of money!
We recently did our house up, it badly needed essential work and it was scary how easily we had access to a lot of money.

Why not move abroad?
I have no idea why anyone would buy in Dublin. Overpriced, under regulated. Saddled with debt your whole life.

Appledreams15 · 09-04-2018 08:24AM

waffleman wrote: »

Wow I thought I was doing well getting my wedding down to under 10k. And that was with a cake from tesco (3 plain bases then decorated) and a gift of 200 bottles of wine from a family friend who owns a bar and lots of other cost cutting. We were determined not to take any loans.

I also pay cash for cars. Last one I bought was 4,200 euro and is running great. Only debt we have is our home but we are half way through the mortgage (10 years in and its a tracker) and repayments are manageable compared to others my age.

I will probably just annoy myself asking this but I need to know - how did you get your wedding costs down to 3k?

I presume it is a registry office wedding. It can be done!

Hector Savage · 09-04-2018 08:28AM

Sure everyone is rich again in Ireland why would they need a loan ??

Take my mams neighbour , im genuinely curious, they have 3 kids, the woman doesn't work - and the husband is a book supplier ....

They have 2 brand new land rovers (the sport version - think they are 80k each)
the house they just got is 700k, plus they are doing lots of renovations .... massive extensions etc (must be at least 50k)

Help me understand the finances here .... I mean "book supplier" ... in the age of amazon etc ...

Maybe he's Jeff Bozos ...

Then again maybe I should mind my ****ing business and not be a begruding c*nt!

Jim Bob Scratcher · 09-04-2018 08:34AM

Hector Savage wrote: »

Sure everyone is rich again in Ireland why would they need a loan ??

Take my mams neighbour , im genuinely curious, they have 3 kids, the woman doesn't work - and the husband is a book supplier ....

They have 2 brand new land rovers (the sport version - think they are 80k each)
the house they just got is 700k, plus they are doing lots of renovations .... massive extensions etc (must be at least 50k)

Help me understand the finances here .... I mean "book supplier" ... in the age of amazon etc ...

Maybe he's Jeff Bozos ...

Then again maybe I should mind my ****ing business and not be a begruding c*nt!

Inheritance money perhaps

donegaLroad · 09-04-2018 08:36AM

eeguy wrote: »

It's a silly system to encourage people to buy new cars just to "keep the years up".
The county letters always confused me too. Why is it important to know that a car was registered in Meath or Carlow?

Should be like the french system. Start at AA-001-AA and work up from there.

It wasn't the intention at the time if introduction, but this system can give you an idea of what wear and tear the car has endured, due to the state of the roads in each particular county. Couty Clare for example, used to have a bad name.

Motivator · 09-04-2018 08:42AM

Hector Savage wrote: »

Sure everyone is rich again in Ireland why would they need a loan ??

Take my mams neighbour , im genuinely curious, they have 3 kids, the woman doesn't work - and the husband is a book supplier ....

They have 2 brand new land rovers (the sport version - think they are 80k each)
the house they just got is 700k, plus they are doing lots of renovations .... massive extensions etc (must be at least 50k)

Help me understand the finances here .... I mean "book supplier" ... in the age of amazon etc ...

Maybe he's Jeff Bozos ...

Then again maybe I should mind my ****ing business and not be a begruding c*nt!

What you’ve described there simply isn’t possible based on the apparent occupation of the male. Either both of them work good jobs or he has a much better job than you think. You could also be wildly exaggerating.

marvin80 · 09-04-2018 08:42AM

LirW wrote: »

Is it now the expected norm that couples are supposed to put themselves into debt for a wedding?

I think big weddings are ridiculous, complete waste of money, especially if you're getting a loan out for it. People spending 30k+ on a piss-up - insane, and then expecting guests to cough-up gifts of cash to cover it - fu*k off!!

https://www.youtube.com/watch?v=2RmRQ_F41-o

LirW · 09-04-2018 09:16AM

Appledreams15 wrote: »

Why not move abroad?
I have no idea why anyone would buy in Dublin. Overpriced, under regulated. Saddled with debt your whole life.

I come from abroad, it's not any better or worse elsewhere, just different. Living in any major city or capital in Europe is going to set you back a good bit. Maybe not if you have savings and move to Sofia.
Also personally I have no interest in leaving Europe permanently, I like it here.

LirW · 09-04-2018 09:21AM

marvin80 wrote: »

I think big weddings are ridiculous, complete waste of money, especially if you're getting a loan out for it. People spending 30k+ on a piss-up - insane, and then expecting guests to cough-up gifts of cash to cover it - fu*k off!!

https://www.youtube.com/watch?v=2RmRQ_F41-o

We're celebrating with 18 adults and 3 kids. We could have kept costs pretty low (I consider the 3,5k as so much) but we're only doing it once so we want that fancy dinner, we want to have that private intimate function room and we also want the good photographer because we only get to do it once.
Surely we could have had the meal somewhere else and cut costs by 40% but for us it's worth it. The big difference is that we can afford that by living frugal and making that our savings priority.
I couldn't justify taking a loan out though to please 150 people, jesus I wouldn't even get to talk to half of them on the day.

valoren · 09-04-2018 09:28AM

There is a reason why 'Personal Finance' is not a core school subject.

Wanderer78 · 09-04-2018 09:31AM

valoren wrote: »

There is a reason why 'Personal Finance' is not a core school subject.

and more worryingly, Mickie mouse economic theories such as neoclassical theory are indoctrinated into us via these systems as being how our economies actually work in reality

Ubbquittious · 09-04-2018 09:47AM

Pinch Flat wrote: »

People are financial illiterate here. They’ll all be on cribbing to Joe Duffy after the next crash telling him how the banks forced them to take out the loans for the car / holiday apartment / overpriced house or whatever.

That's easily avoidable by switching off Joe but what's worse is we'll have that bollix Noonan sending the revenue dogs out after us all to pay an extra few grand a year so he can pay back the well-deserving megacorps who lent out the money to these peeps

For Forks Sake · 09-04-2018 09:51AM

Ubbquittious wrote: »

That's easily avoidable by switching off Joe but what's worse is we'll have that bollix Noonan sending the revenue dogs out after us all to pay an extra few grand a year so he can pay back the well-deserving megacorps who lent out the money to these peeps

Noonan retired last year.

LirW · 09-04-2018 09:55AM

valoren wrote: »

There is a reason why 'Personal Finance' is not a core school subject.

And unfortunately financial decency can't be passed down in families when you're holidaying with loans or buy that PlayStation for Christmas on a finance plan.

suicide_circus · 09-04-2018 10:04AM

LirW wrote: »

And unfortunately financial decency can't be passed down in families when you're holidaying with loans or buy that PlayStation for Christmas on a finance plan.

Nail on head. Let's stop blaming the state for not teaching basic common sense and basically everyone else for our own stupidity. I would never in a million years take a loan to buy a car, probably because my parents never did it. They kept old cars going as long as they could and scrimped and saved to buy a second hand replacement in cash when necessary. They live according to their means and didn't give two sh*ts about keeping up with the neighbours.

nsa0bupkd3948x · 09-04-2018 10:07AM

meeeeh wrote: »

Sensible car loan is perfectly fine if you can service it. I'm not in favour of buying a new car every couple of years but an old car can be more expensive to maintain, insure and less safe to drive. There is no point patting yourself on the back because you are not paying a loan if you suddenly end up with 5k repair cost for an old banger.

Are you factoring in depreciation? I’ve seen many people ‘move up the years’ to save a couple of hundred in maintenance all the while losing thousands a year in depreciation.

Wanderer78 · 09-04-2018 10:09AM

suicide_circus wrote: »

Nail on head. Let's stop blaming the state for not teaching basic common sense and basically everyone else for our own stupidity. I would never in a million years take a loan to buy a car, probably because my parents never did it. They kept old cars going as long as they could and scrimped and saved to buy a second hand replacement in cash when necessary. They live according to their means and didn't give two sh*ts about keeping up with the neighbours.

and where does the ethics of our financial system come into this, are they free from blame here, our educational system teaches us a Utopian view of what part our financial system plays in our economies, and the understanding of the workings of these financial institutions is largely untrue

09-04-2018 10:11AM

I don't know most people are fairly savvy with their money and non-mortgage debt in Ireland is decreasing that is possibly why there is so much aggressive loan advertising. The crash has made people wary.

The PCP are a good idea for some, a friend of mine has a long commute and needs a decent car she traded it in every two years, it is akin to renting a car I think, she has no maintenance cost and it's structured to take in the millage she does.

The ones I cant get my head around are, in a position to get a good mortgage ect have save up 20k for the wedding it's not a loan, that's alright their choice but, but by making that choice they have taken away the choice to take a year off work when the baby comes along.

We are much more risk-averse than the UK, they have mortgages where its possible to buy 30 to 50% of the house and rent the rest and parental loan as a mortgage guarantee etc.

There are people who cant manage their money but they would always be like that and come from families like that.

suicide_circus · 09-04-2018 10:15AM

Wanderer78 wrote: »

and where does the ethics of our financial system come into this, are they free from blame here, our educational system teaches us a Utopian view of what part our financial system plays in our economies, and the understanding of the workings of these financial institutions is largely untrue

We have a financial regulator, if it's not fit for purpose then upgrade it. There is certainly a lack of accountability you're right. Banks overstretch themselves? Bailed out by the tax payer. Dont pay your mortgage? Get to keep your home.
Even if the institutions were more prudent, it is ultimately for the individual to make sure they don't overstretch themselves. Personal responsibility.

09-04-2018 10:16AM

I've also noticed the uptick in credit based advertisements. Be it banks and mortgages, or retail stores and their finance offers, they are gradually working their way back to the forefront.

This, along with the sight of many cranes back in the city skylines, construction picking back up in the small towns where polished shoeboxes are being thrown up in places they have absolutely no business being built without any thought towards local planning or infrastructure...I hope we're not heading back down the same path already.

Well, I mean I know that we are, I just hope I have a few more years to prepare for the next mass transfer of wealth.

LirW · 09-04-2018 10:18AM

I think it's more important to teach when is the situation there that you need to take out a loan. I don't think that loans per se are a bad thing, what's bad is how easily you can pile on debt and losing control over it.
Do you need that 20 grand loan for the wedding? No you don't because you're putting on debt for a big party.
Do you need the 20 grand loan because your roof came down and your useless insurance does fck all to pay for it? Yes, this is a valid reason.

I don't wanna be sitting on a high horse, we took out a loan for home improvements, we bought a small house in cash, it needed work and we planned to do it time over time. The survey was absolutely useless and soon after moving in we faced some major issues that we didn't know about. It was the "ripping the house apart" kinda level and while we had some money aside for gradual work, we needed to take out some money. We literally had water coming through the ceiling when the shower was on.

Or a medical emergency, that is a very valid reason to take money from the bank too.
But a lot of advertised loans push a lifestyle on debt.

09-04-2018 10:19AM

https://www.irishtimes.com/business/economy/irish-household-debt-falling-faster-than-in-any-other-eu-country-1.3077990
Irish household debt falling faster than in any other EU country

cantdecide · 09-04-2018 10:20AM

suicide_circus wrote: »

I would never in a million years take a loan to buy a car, probably because my parents never did it.

Talking about debt always brings out these puritanical, black-and-white statements. How can you know everyone else's circumstances enough to declare that they shouldn't borrow for a car? As if everyone that ever has a drink is some kind of alcoholic. I say there is often or at least sometimes a place for modest, well managed debt.

I borrowed €3k for my car over three years, three years ago and put it with €2k I saved. The result is a car that was always worth more than the debt, payments I barely felt (€100/mth), the use of a modern, low mileage, economical hatchback that's been totally reliable. It's just about paid off now, it's still worth €2,500 at least and I'll keep if for another 2 years while I focus on other aspects of my life. Not bad for a guy working minimum wage and studying most of the time I was making the payments.

The car I had before that cost me €1000 in repairs in the year I had it. What would I have paid in repairs for that car if I'd kept it three more years? Instead, I've had three years of unexpected repairs avoided and I still own a car outright that's worth €2,500, that's still low mileage.

Loans everywhere!

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