Mortgage arrears extended to 6 months.

craichoe

http://www.breakingnews.ie/ireland/advice-centres-welcome-extension-of-mortgagearrears-period-433706.html

So,

This concerns me a little bit, the interest rate will inevitably rise over the next 6 months, so will you be paying your arrears at the new interest rate or old 6 months in the future.

People may be lured into thinking they can go for this and have more income in the short term when they could be cutting back in other areas to pay for it now.

Just think it promotes the get money now pay later culture ..

Thoughts ?

seamus

The arrears owed don't accrue interest (afaik it's illegal to charge interest on interest), however because you're not reducing your mortgage, interest will be added to future payments a the higher rate.

I don't have a problem with this per se - this isn't a "get out of jail free" card. You're only eligible if you've spoken to your lender and come up with an alternative payment schedule. So it's not just 6 more months for people to stick their fingers in their ears and pretend it's not happening.

I guess the rationale is based on how long it's taking people to find work.

mrgaa1

its a welcome break for homeowners who are experiencing difficulty. I would hope that this is extended to business's (SME's in particular) who are employing people that any loans they have that the banks will re-negiotate and assist. Is this not one of the purposes of banks?

Daithinski

Six months doesn't sound like much. The economy is predicted to be plunging downwards in six months (and beyond). Six years would probably be more helpful.

Six months sounds like putting off the inevitable for a little while...