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So ....the Banks are getting real?

  • 19-02-2012 09:46PM
    #1
    Fulton Crown
    Banned (with Prison Access) Posts: 2,493 ✭✭✭


    As reported in the media ..people with Mortgage Arrears problems are being asked to :

    take their kids out of private schools

    Have only the basic TV package

    Ditch the second car

    Discontinue Health Insurance / Gym membership/Golf Club membership.

    Would have thought anyone with mortgage problems would have done all that before they got in a position where the banks were telling them to do it?

    Freekin hell if you have serious financial problems do you really expect to be rolling up to the private school in the SUV picking up young Jeremy or Vogue ?

    Am I missin sommat ?


«134

Comments

  • #2
    Sindri
    Closed Accounts Posts: 5,059 ✭✭✭Sindri


    What...did they used to exist in some vacuous alternate dimension where matter did not exist?


  • #3
    lividduck
    Closed Accounts Posts: 1,250 ✭✭✭lividduck


    Fulton Crown wrote: »
    As reported in the media ..people with Mortgage Arrears problems are being asked to :

    take their kids out of private schools

    Have only the basic TV package

    Ditch the second car

    Discontinue Health Insurance / Gym membership/Golf Club membership.

    Would have thought anyone with mortgage problems would have done all that before they got in a position where the banks were telling them to do it?

    Freekin hell if you have serious financial problems do you really expect to be rolling up to the private school in the SUV picking up young Jeremy or Vogue ?

    Am I missin sommat ?
    Totally agree, those who want to appear rich but cant afford it shouldnt recieve help until they take reasonable steps to lower their bills.


  • #4
    Biggins
    Banned (with Prison Access) Posts: 34,567 ✭✭✭✭Biggins


    I refuse to give up my Jellybabies no matter what my bank manager might say!


  • #5
    LETHAL LADY
    Registered Users, Registered Users 2 Posts: 3,145 ✭✭✭LETHAL LADY


    Seems like a parody to me.;)


  • #6
    krudler
    Registered Users, Registered Users 2 Posts: 34,788 ✭✭✭✭krudler


    I regularly see people with phone bills of 300+ a month who are on the dole, and refuse to go on higher minute packages cos "they cant afford it" err,, right so keep running up bills that are more than what I spend a year on your phone every month so, dumbass.


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  • #7
    questionmark?
    Registered Users, Registered Users 2 Posts: 3,090 ✭✭✭questionmark?


    What do you mean? A mortgage, a secured debt against your house, needs to be treated as the priority debt and not a sky movies package :eek:


  • #8
    Collie D
    Registered Users, Registered Users 2 Posts: 11,585 ✭✭✭✭Collie D


    Can't say I agree with them telling people to ditch health insurance but the others make sense.


  • #9
    LETHAL LADY
    Registered Users, Registered Users 2 Posts: 3,145 ✭✭✭LETHAL LADY


    To be fair this image of fookers having 3 foreign holidays a year, whilst driving around in SUVs, and every family member dripping in versace is a myth where I come from. Did this type of indulgence ever happen?


  • #10
    KKkitty
    Registered Users, Registered Users 2 Posts: 7,537 ✭✭✭KKkitty


    Some people have clearly not realised the economic bubble has burst. Worst thing is some will not cop on til debt collectors knock on their door.


  • #11
    Sindri
    Closed Accounts Posts: 5,059 ✭✭✭Sindri


    krudler wrote: »
    I regularly see people with phone bills of 300+ a month who are on the dole, and refuse to go on higher minute packages cos "they cant afford it" err,, right so keep running up bills that are more than what I spend a year on your phone every month so, dumbass

    What an insightful observation articulated so eloquently! :)


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  • #12
    starlit
    Registered Users, Registered Users 2 Posts: 12,349 ✭✭✭✭starlit


    They gotten a bit much regarding telling people how to spend by their mortgage lenders. If they cut down on this that and the other, fair enough it makes sense to cut down certain bills like sky sport/movies and just get a selective number of channels, hopefully the saoirvew will become popular!! You get as much as you need.

    Though telling people how to spend on their groceries and where to shop is a bit much but fair enough that extreme expenses should be limited like placing their children in public schools than in private ones. There is no need for the extra expense as education is expensive as it is.

    Treats and luxuries should be restricted so as to afford their mortgage and then complain they can't. So it is wise they give up unnecessary things in their lifestyle. The money all adds up and only focus on the essentials, groceries, heating, electricity, car etc.

    There are surely things people can live without or limit spending on? Do a continuous monthly and weekly budget to keep an eye on expenses. If you spend and not what or how much you are spending on you need to start counting the pennies. I know its a pain but its a recession and everyone should be able to have a reasonable standard of living within their means not beyond their means if their lifestyle dictates. Just adjust their lifestyle not necessary change completely but change a few things here and there, its a amazing how much you could save!

    Cut down on impulse buys though, stick with what you have on your shopping list! Think before you buy!


  • #13
    Sindri
    Closed Accounts Posts: 5,059 ✭✭✭Sindri


    Fulton Crown wrote: »
    As reported in the media ..people with Mortgage Arrears problems are being asked to :

    take their kids out of private schools

    Have only the basic TV package

    Ditch the second car

    Discontinue Health Insurance / Gym membership/Golf Club membership.

    Would have thought anyone with mortgage problems would have done all that before they got in a position where the banks were telling them to do it?

    Freekin hell if you have serious financial problems do you really expect to be rolling up to the private school in the SUV picking up young Jeremy or Vogue ?

    Am I missin sommat ?

    I somehow doubt many people with mortgage arrears have not already done this? I would find it hard to believe they would not have.


  • #14
    LETHAL LADY
    Registered Users, Registered Users 2 Posts: 3,145 ✭✭✭LETHAL LADY


    I still to this day cannot understand why financial institutions with staff trained in finance, economics and the rest, lent money to people who obviously, in the medium term could not afford it, can someone please explain this to me, because I reckon there is a case to be made on the part of the borrower.


  • #15
    Fulton Crown
    Banned (with Prison Access) Posts: 2,493 ✭✭✭Fulton Crown


    Yeah..I was surprised too...but was lead article i Saturdays's Indo....so probably a load of old bollox .

    Havn't heard any denials from the Banks..or any other media disproving the story....


  • #16
    starlit
    Registered Users, Registered Users 2 Posts: 12,349 ✭✭✭✭starlit


    All the banks cared about was getting the money didn't matter to them if people could repay or not but they have got more stern about it now though cause they have lost out on the money cause of those greedy developers and bankers they are trying to get as much as they can out of people.

    People should have been advised a way better by those who have financial and economics knowledge and know how! They should have nearly seen it coming to an extent and warned people or at least tell and how people to manage their money better before getting a mortgage if they can pay then that's fine but if not they shouldn't have been forced to have to pay huge amounts and just get a smaller house if they can.


  • #17
    RichieC
    Closed Accounts Posts: 7,331 ✭✭✭RichieC


    Some people are upper class in their heads and always will be.


  • #18
    Robdude
    Closed Accounts Posts: 709 ✭✭✭Robdude


    Fulton Crown wrote: »
    As reported in the media ..people with Mortgage Arrears problems are being asked to :

    take their kids out of private schools

    Have only the basic TV package

    Ditch the second car

    Discontinue Health Insurance / Gym membership/Golf Club membership.

    Would have thought anyone with mortgage problems would have done all that before they got in a position where the banks were telling them to do it?

    Freekin hell if you have serious financial problems do you really expect to be rolling up to the private school in the SUV picking up young Jeremy or Vogue ?

    Am I missin sommat ?

    I think it's easy to get upset about those things; but if you stop and think about it, it's pretty easy to understand how and why it happens.

    If you were making good money and could afford those things; it's not easy to immediately revert to a cheaper lifestyle. A lot of the things you've mentioned involve long-term contracts, are non-liquid assets, or are social disruptive to loved ones.

    I have a gym membership - I've paid in advance for two years (it's cheaper that way). I'm pretty sure I can't get a refund, at least without some medical reason or something. If I lost my job, I'd think, 'Hey - well, I ALREADY paid for the gym, might as well use it'.

    I had a very expensive smart-phone and was in the middle of a two year contract with my cell phone provider when I became unexpectedly unemployed a year ago. That didn't mean I could magically get rid of my cell phone contract. Even though I had no income, I still had a really nice phone and unlimited data plan. It was either keep it, or pay a huge fee to break my contract. The savings would have been very minimal.

    If you have an extra car, it's either paid off or you are making payments. In either case, selling a car is a losing proposition, you'll never get out what you put in. If it is paid off, you sell it, take a huge loss, and your situation isn't improved because your monthly bills are still coming in. Two months later, you are still broke. If you are paying for it each month, same thing. In many cases, you wouldn't be able to sell it for enough to repay your outstanding balance on the vehicle. Selling it doesn't make much sense.

    Pulling your children out of school - that's the most understandable to avoid. It can be very hard to for children to deal with that, particularly if you already feel like a failure for being unable to provide.

    I don't support any measures that allow people to live a lifestyle they can't afford. But I do understand how someone can be both poor and have nice things/contractual obligations they can't meet.


  • #19
    flutered
    Registered Users, Registered Users 2, Paid Member Posts: 6,765 ✭✭✭flutered


    KKkitty wrote: »
    Some people have clearly not realised the economic bubble has burst. Worst thing is some will not cop on til debt collectors knock on their door.

    he will not get to mine, the first line of house insurance will ensure that.


  • #20
    ejmaztec
    Registered Users, Registered Users 2 Posts: 24,369 ✭✭✭✭ejmaztec


    flutered wrote: »
    he will not get to mine, the first line of house insurance will ensure that.

    You've got "A Team" coverage, cool.


  • #21
    dxhound2005
    Registered Users, Registered Users 2, Paid Member Posts: 24,787 ✭✭✭✭dxhound2005


    We're all experts now but if you look back to 2005/2006 there are plenty of threads like the one below from people asking about 100% mortgages and I don't see anyone checking in to say mad idea.

    http://www.boards.ie/vbulletin/showthread.php?p=50685852

    I have a simple way for people to save money if they really are at the pin of their collar. Stop buying food and then throwing it away without eating it.

    http://www.stopfoodwaste.ie/index.php?id=59&menu=


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  • #22
    SeanW
    Registered Users, Registered Users 2, Paid Member Posts: 10,056 ✭✭✭✭SeanW


    LETHAL LADY wrote: »
    I still to this day cannot understand why financial institutions with staff trained in finance, economics and the rest, lent money to people who obviously, in the medium term could not afford it, can someone please explain this to me, because I reckon there is a case to be made on the part of the borrower.
    It's very simple, and can be explained by both Keynesian and Austrian economics.

    The Keynesian explanation:
    Inflationary monetary policy and loose fiscal policy should only be used to counter the economic cycle, i.e. government spending and low interest rates should be deployed in times of economic downturn to revive the economy into an upswing. An improper time of deployment of these measures (we had giveaway budgets from the clowns in the Dail and a low interest rate imposed on us from Frankfurt) will lead to "pouring fuel on the fire," causing an economic overheat and aggravating the bust.

    The Austrian explanation:
    Any time you have interest rates set below that which the market would otherwise demand - usually accomplished by loose monetary policy - that money will ALWAYS find its way into unviable projects, like housing construction. A false boom, including crazy debt levels and a waste of resources should raise the alarm but never does, and a bust is inevitable as the fundamentals of the economy are revealed not to be sound.
    https://www.youtube.com/watch?v=d0nERTFo-Sk


    One thing is clear, the culpability of the European Central Bank cannot be denied because as the Irish economy was overheating and in bubble mode, the ECB kept interest rates low because, in their view, this policy was required for the then sluggish economies of Germany and France.

    And, then there's the small issue of the Europe that caused the problem forcing the people of Ireland to socialise all the bad bank debt when it all came crashing down.
    :(

    (You can imagine I'm not the greatest fan of the European Union right now)

    https://u24.gov.ua/
    Join NAFO today:

    Help us in helping Ukraine.



  • #23
    LETHAL LADY
    Registered Users, Registered Users 2 Posts: 3,145 ✭✭✭LETHAL LADY


    So loan officials in banks are simpletons? Joe Soap tradesman with 1000 plus euro a week walks into a bank and asks the lender for a 350,000 mortgage. My opinion as a mature student starting a finance degree is fook off, the risks (unguaranteed income) far outweigh the benefits (temporary wealth) so imo the banks are liable they have trained people and they ignored the risks.


  • #24
    Fulton Crown
    Banned (with Prison Access) Posts: 2,493 ✭✭✭Fulton Crown


    Robdude wrote: »
    I think it's easy to get upset about those things; but if you stop and think about it, it's pretty easy to understand how and why it happens.

    Yes I can understand that .
    If you were making good money and could afford those things; it's not easy to immediately revert to a cheaper lifestyle. A lot of the things you've mentioned involve long-term contracts, are non-liquid assets, or are social disruptive to loved ones.

    I agree ..it's not easy..but necessary ?
    I have a gym membership - I've paid in advance for two years (it's cheaper that way). I'm pretty sure I can't get a refund, at least without some medical reason or something. If I lost my job, I'd think, 'Hey - well, I ALREADY paid for the gym, might as well use it'.

    No issue here ..looks like no brass to be saved...pretty stupid paying two years in advan for gym unless there was a huge incentive.....just sayin ...

    I
    had a very expensive smart-phone and was in the middle of a two year contract with my cell phone provider when I became unexpectedly unemployed a year ago. That didn't mean I could magically get rid of my cell phone contract. Even though I had no income, I still had a really nice phone and unlimited data plan. It was either keep it, or pay a huge fee to break my contract. The savings would have been very minimal.

    Ditto ...above
    If you have an extra car, it's either paid off or you are making payments. In either case, selling a car is a losing proposition, you'll never get out what you put in. If it is paid off, you sell it, take a huge loss, and your situation isn't improved because your monthly bills are still coming in. Two months later, you are still broke. If you are paying for it each month, same thing. In many cases, you wouldn't be able to sell it for enough to repay your outstanding balance on the vehicle. Selling it doesn't make much sense.

    Mmmm? If it's paid off ..then the charges ..tax /insurance/petrol/servicing are gone.....
    Pulling your children out of school - that's the most understandable to avoid. It can be very hard to for children to deal with that, particularly if you already feel like a failure for being unable to provide
    .

    Unable to provide ? What ? Still get an education pal...probably a better one.
    I don't support any measures that allow people to live a lifestyle they can't afford. But I do understand how someone can be both poor and have nice things/contractual obligations they can't meet.

    Don't overstreach in straitened financial times....makes sense !


  • #25
    SeanW
    Registered Users, Registered Users 2, Paid Member Posts: 10,056 ✭✭✭✭SeanW


    LETHAL LADY wrote: »
    So loan officials in banks are simpletons? Joe Soap tradesman with 1000 plus euro a week walks into a bank and asks the lender for a 350,000 mortgage. My opinion as a mature student starting a finance degree is fook off, the risks (unguaranteed income) far outweigh the benefits (temporary wealth) so imo the banks are liable they have trained people and they ignored the risks.
    No, they are not. They acted responsibly given the false information that was percolating throughout the economy - starting from our gombeen government and the European Central Bank.

    If your economic projections are built on a platform of fabrications like the Irish and American economies were, then yes, it (appears to) make sense to lend 350,000 to a tradesman with 1000 p/w income.
    1. You have no reason to believe he's not going to have that job for the medium term.
    2. Even if he defaults, the house will (you think) be worth *more* when you foreclose on it than what amount is due, perhaps even more than it was worth when you made the loan in the first place. This was the basis for the inflation of the sub-prime portion of the bubble in the U.S.
    The fact is that the Irish banking system was destroyed by the European Central Bank and now they're making us pay for it.


    It's similar to what happened in the U.S. only their response has been a little bit more sane.

    https://u24.gov.ua/
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    Help us in helping Ukraine.



  • #26
    LETHAL LADY
    Registered Users, Registered Users 2 Posts: 3,145 ✭✭✭LETHAL LADY


    SeanW wrote: »
    No, they are not. They acted responsibly given the false information that was percolating throughout the economy - starting from our gombeen government and the European Central Bank.

    If your economic projections are built on a platform of fabrications like the Irish and American economies were, then yes, it (appears to) make sense to lend 350,000 to a tradesman with 1000 p/w income.
    1. You have no reason to believe he's not going to have that job for the medium term.
    2. Even if he defaults, the house will (you think) be worth *more* when you foreclose on it than what amount is due, perhaps even more than it was worth when you made the loan in the first place. This was the basis for the inflation of the sub-prime portion of the bubble in the U.S.
    The fact is that the Irish banking system was destroyed by the European Central Bank and now they're making us pay for it.


    It's similar to what happened in the U.S. only their response has been a little bit more sane.

    In theory I agree with point 1 but surely cynicism plays a part in all financial dealings?


  • #27
    SeanW
    Registered Users, Registered Users 2, Paid Member Posts: 10,056 ✭✭✭✭SeanW


    LETHAL LADY wrote: »
    In theory I agree with point 1 but surely cynicism plays a part in all financial dealings?
    Obviously not during the boom time.

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    Help us in helping Ukraine.



  • #28
    bfocusd
    Closed Accounts Posts: 723 ✭✭✭bfocusd


    I volunteer in my old school and last year a kid was transfered to the school, his family were multi millionaires and had the mansion house and a home abroad, the private boarding school, everything money could buy. But they are penniless now and up to there neck in debt, they've moved into a 2 bed council house and are living on the dole.

    At first I thought the lad would be eaten alive by the other students, he had everything anyone could of ever wanted and kids can be very cruel with jealousy of how he lived his life. But he's fit in fine, it was a big shock at first for him, he does still struggle sometimes, but claims he prefers having real friends, living at home and having his parents around, rather than being in boarding school or having an au pair. From what ive gathered the parents are struggling still, but who wouldn't, thats a major lifestyle change.

    I spoke to a teacher about how he was doing and we both thought it seems better for him to live in the real world and learn how to fend for himself, even for him to be able to hang out with mates on the road playing football after school is something he would have never done.


  • #29
    Sindri
    Closed Accounts Posts: 5,059 ✭✭✭Sindri


    SeanW wrote: »
    No, they are not. They acted responsibly given the false information that was percolating throughout the economy - starting from our gombeen government and the European Central Bank.

    If your economic projections are built on a platform of fabrications like the Irish and American economies were, then yes, it (appears to) make sense to lend 350,000 to a tradesman with 1000 p/w income.
    1. You have no reason to believe he's not going to have that job for the medium term.
    2. Even if he defaults, the house will (you think) be worth *more* when you foreclose on it than what amount is due, perhaps even more than it was worth when you made the loan in the first place. This was the basis for the inflation of the sub-prime portion of the bubble in the U.S.
    The fact is that the Irish banking system was destroyed by the European Central Bank and now they're making us pay for it.


    It's similar to what happened in the U.S. only their response has been a little bit more sane.

    While I agree with you, I think only an idiot would not consider, or not acknowledge, that there may have been a bubble and that their behaviour was somewhat reckless.

    After all their modus operandi is profit, and you would think it counter productive to not at least consider, given the position they were in as financial experts with that obligation towards profit, not to possibly speculate that they may not be getting that money back, and that the value of the property would fall if should an event occurred.


  • #30
    Sindri
    Closed Accounts Posts: 5,059 ✭✭✭Sindri


    SeanW wrote: »
    Obviously not during the boom time.

    That's when it should apply more than any other time!


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  • #31
    LETHAL LADY
    Registered Users, Registered Users 2 Posts: 3,145 ✭✭✭LETHAL LADY


    SeanW wrote: »
    Obviously not during the boom time.

    But surely then trained professionals should adequately advise those without same, or is there a legality issue?


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