awec wrote: » The deposit rule is to try guard against negative equity to a certain degree. It shouldn't go anywhere.
SozBbz wrote: » Also, I'd argue that DLR is NOT a belweather, its the ultimate outlier. Its the most affluent LA region in the country. Its where things happen first, not an indicator of whats happening nationally. Sure, the national trend tends to follow, but often many years later.
ZX7R wrote: » Unsold stock is mainly a Dublin problem,as with most things it does not really represent the county as a hole . That is down to price and price only
Assetbacked wrote: » Hmm maybe operate it so that factoring in rent payments in lieu of a deposit is allowed only where your rent for the previous X number of months was at least Y% higher than paying the mortgage they are willing to give to you based on your salary, etc. Maybe not even operate it in lieu of a deposit but as a derogation from the requirement to have at least a 10% deposit, e.g. Only 5% deposit is required if you can show you've paid for the previous X months Y% higher than the mortgage you require.
awec wrote: » The 10% is not a question of affordability, so rent payments don't come into it. The reason they insist on 10% minimum is so you can absorb a 10% drop in the market and stay in positive equity. If, on the day you got the keys to your new gaff, house prices dropped 10%, you'd be fine. 5% is really not a lot, so you'd be left very exposed to even slight market changes if you were borrowing 95%.
Assetbacked wrote: » But that assumes the mere fact the price of the house drops instantly by 10% is necessarily catastrophic to your ability to repay. Is that not a bit extreme? After all, negative equity only matters if you are selling or can't afford the mortgage.
JJJackal wrote: » If your selling up you also have auctioneer fees and solicitor fees. So a drop of <10% would be enough for you not to be able to pay the full mortgage back on resale
Mickiemcfist wrote: » It means that you have zero fallback should you not be able to repay. I.e. you can't sell up & repay your mortgage.
The_Conductor wrote: » There are tens of thousands of people from the last time round who bought apartments in Dublin- who are still, even now, in negative equity. Its only an issue if you are selling the unit and have to capitalise the equity loss (and most lenders do facilitate bringing negative equity over to subsequent property- if you can prove repayment capacity). Its not a massive issue really- though obviously you'll feel poorer if you're in negative equity- but its a paper loss, its not money that you actually have at your disposal.
Mickiemcfist wrote: » Yea, you're making my point for me. There are still tens of thousands of people from last time round who are still even now, in those apartments, despite having massively outgrown them as a family but banks are not facilitating bringing negative equity over to a subsequent property. I know of 5 families off the top of my head who are in that situation, more people than I know who've had it easier & traded out of it. You can argue whatever way you want, but someone buying a property should have skin in the game, banks should be buffered from risks & 10% is not exactly a massive number. The HTB can contribute to it & banks are giving cashback offers, theres ways of doing it.
lawred2 wrote: » Where is this? What type? Commercial or residential?
Padre_Pio wrote: » But they are already paid by this point. Why would they be included?
JJJackal wrote: » Because if the bank is selling it or you and the bank have agreed to sell it there are new fees - probably 2-3% of the value of the property So I buy a house today with 90% mortgage 10% deposit. Tomorrow I decide I cant afford it. I hopefully will sell at 100% but my costs will be 2-3% so I will only get 97-98%. If prices dropped overnight by 10%, the bank would have to pay legal...
Padre_Pio wrote: » And they would simply pass the charges onto you, leaving you still in debt.
JJJackal wrote: » exactly my point
riclad wrote: » i Know people outside dublin who are still in negative equity, the mortage is nearly still twice the value of the property. Prices in rural area,s have not gone up as much as in citys like dublin.
OwlsZat wrote: » Where?
The_Conductor wrote: » There are some developments in Co. Dublin that went for between 400 and 450k back in 2007- that are now barely worth 300k- even after the recovery in prices. Its very location specific- average apartment prices in Dublin are now at 87% of their peak values- however, an average hides a wealth of divergences at both sides of the equation.........
alias no.9 wrote: » No matter how inflated the prices may have been, 10+ years of mortgage repayments along with the recovery since 2013 should have eliminated negative equity unless there was arrears or interest only periods.
mariaalice wrote: » But the person who purchased in 2007 has paid a morgage for 12 year so how could hey still be in negative equity?
appledrop wrote: » No when you first staying paying off your mortgage nearly all of the money you pay goes off the interest not the actual mortgage money. The longer your mortgage term the worse this is. So if someone took out a 40 year mortgage they wouldn't actually have that much money paid off principal if only 10-12 years in.
mariaalice wrote: » Would there be many who took out a 100% 40-year mortgage in 2007, and after that how many took it out for a 1 or 2 bed appartment and how many took it out for a 3 bed semi.
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