For anyone who faces losing their home...

later12

Mahatma coat wrote: »

How about we start with the people of Ireland, instead of taking their money and giving it to some Slimey InternationalBankers use that as Investment Seed capital.

Oh right, so we dip into peoples' savings accounts? Or how about their current accounts? This is a great idea, how about we abolish private property too! Jeez why has nobody ever thought of this before!

We could call it communitism. No, no, wait, communalism.. no....wait, I'm getting there...

mistermouse

Some system will need to be worked out where people can have mortgages extended or reworked to make them affordable in the interim. Its quite possible that the country will recover over say 10 years and perhaps allow for property to increase in value.

I do not believe that those who didn't get into the property bubble should have to pay to keep anyone else afloat, especially those who lived beyond their means. The taxpayer should not have to bailout banks, developers or mortgage holders and allow any of them to continue with the lifestyles they are accustomed to.

Perhaps those who have to forego their home, do so but are allowed to stay on renting. I am sure its better than being saddled with their mortgages and still get use of their home.

If people get a bailout to keep their homes at the taxpayers expense, should those who don't, not get massive lump sums or tax writeoffs for years to make up for it. We are told that Nama and the Banks are important to keep the country viable but we are also told that the Taxpayer might, just might see a return over 10/20 years.

Writing off mortgage debt will never produce any benefit for the taxpayer, only those who enetered into foolish agreements and would get to keep the asset.

FreudianSlippers

The problem is really visible in the US at the moment. They are coming out of their recession (way worse than here btw) and those that have managed to hang on to their houses are now buried in debt and have destroyed their credit rating.
Then when they cannot afford to pay their mortgage and all credit has run try the banks want to foreclose.

What's happening that is disgusting is this:

Person X owes $250,000 on their mortgage and cannot pay.
House is now worth $100,000 and Person X does whatever they can to offer to pay the bank $100,000 but the bank (because of Person X's Credit report) says no.
Then the bank does so called "repossession tours" of these homes and sells them to, lets face it, scavengers for $80,000.

North_West_Art

OisinT wrote: »

What's happening that is disgusting is this:

Person X owes $250,000 on their mortgage and cannot pay.
House is now worth $100,000 and Person X does whatever they can to offer to pay the bank $100,000 but the bank (because of Person X's Credit report) says no.
Then the bank does so called "repossession tours" of these homes and sells them to, lets face it, scavengers for $80,000.

...and the bank then follows Person X for the outstanding $170,000 owed on the original mortgage agreement (which is also happening here)

amacca

OisinT wrote: »

Then the bank does so called "repossession tours" of these homes and sells them to, lets face it, scavengers for $80,000.

I take it you wouldn't try to profit from anothers misfortune?

Me...I'm not so sure.

FreudianSlippers

amacca wrote: »

I take it you wouldn't try to profit from anothers misfortune?

Me...I'm not so sure.

They actually call themselves scavengers tbf.

I would definitely profit off of it, I'm not saying they are wrong for doing so... I'm saying the banks are wrong for not giving the current resident the opportunity to work out a deal on the house before selling it off.

Remember these scavengers also get federal tax credits and subsidies for purchasing the homes from the US Federal Government.

amacca

OisinT wrote: »

They actually call themselves scavengers tbf.

I would definitely profit off of it, I'm not saying they are wrong for doing so... I'm saying the banks are wrong for not giving the current resident the opportunity to work out a deal on the house before selling it off.

Remember these scavengers also get federal tax credits and subsidies for purchasing the homes from the US Federal Government.

ah, fair play...I misinterpreted. I admire a bit of honesty......even if I'm not always able to practice it despite making the effort.

johnnyskeleton

OisinT wrote: »

They actually call themselves scavengers tbf.

I would definitely profit off of it, I'm not saying they are wrong for doing so... I'm saying the banks are wrong for not giving the current resident the opportunity to work out a deal on the house before selling it off.

Remember these scavengers also get federal tax credits and subsidies for purchasing the homes from the US Federal Government.

Supposing in your example that the house is worth 100k i.e. either the homeowner could service that level of debt or else one of your "scavengers" is prepared to pay that.

All things being equal, why is it morally wrong for the bank to prefer someone new with a good credit rating and no debts over the person with a bad credit rating that has already cost them a 160k loss?

This idea that people should be allowed to remain living in a house that they cannot afford because it is "their home" is a nonsense. If I rent a €4k per month dalkey pile and stop paying the rent after the first month, can I stay squatting there forever because it is "my home"? Alternatively, should the landlord be obliged to reduce the rent to whatever level I can afford? If not, how is a mortgage situation any different?

noodler

I wish we had the US system whereby you can simply give the keys back and walk away and not be chased for the outstanding mortgage.

FreudianSlippers

johnnyskeleton wrote: »

Supposing in your example that the house is worth 100k i.e. either the homeowner could service that level of debt or else one of your "scavengers" is prepared to pay that.

All things being equal, why is it morally wrong for the bank to prefer someone new with a good credit rating and no debts over the person with a bad credit rating that has already cost them a 160k loss?

This idea that people should be allowed to remain living in a house that they cannot afford because it is "their home" is a nonsense. If I rent a €4k per month dalkey pile and stop paying the rent after the first month, can I stay squatting there forever because it is "my home"? Alternatively, should the landlord be obliged to reduce the rent to whatever level I can afford? If not, how is a mortgage situation any different?

I'm just saying that the banks should consider allowing the people currently living in the home to pay $100,000 over a 3rd party paying $80,000.

Amhran Nua

Irish Slaves for Europe wrote: »

Restructuring mortgages to an affordable amount for the mortgage holder would seem a sensible solution, with the house then being sold by the bank when they die. In most cases the value of the house would then be greater than the mortgage still outstanding, in which case the bank takes they share to cover off the rest of the mortgage and any surplus then goes to the children of the deceased.

That's actually not a horribly bad idea. I can see two problems with it though - you'd have to convince the people the banks owe money to to accept a longer term payback, which I can't see happening, and you'd consign all those people who bought accommodation barely fit for human habitation as a "starter home" to live there for the rest of their lives, which may not be tenable if they have children.

Its a grim situation, no doubt about it. I think most commentators are looking at it from the wrong angle though. The best outcome is if the mortgages get repaid, that way the banks (I mean the government and hence the taxpayers) get good assets on the books, the homeowners get to keep their homes, and the wolf is put from the national door.

The only way to secure such an outcome is by shifting the focus to getting in good or at least reasonable paying jobs, and plenty of them, and stop trying to come up with financial acrobatics to kick the can up the road.

Debt laws need to be reformed, but they can't be reformed for existing debts because that would bury the banks even deeper, and cost us even more, bringing default ever closer. The IMF suggestion focused on enterprise debt, which is exactly what should be looked at.

Any scheme to shift further debt onto the taxpayer is morally and financially insupportable, everyone needs to get that through their heads once and for all.

We're already going to be paying more taxes just to secure the money we have saved in the banks.