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Ireland, where repaying your mortgage is optional

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    #92
    murphaph
    Registered Users Posts: 19,022 ✭✭✭✭murphaph


    UDP wrote: »
    That used to be the case but not as of a few years ago due to a law change although when I lived there a few years back (after the law changed) some landlords were still requesting it to be done but there was no legal obligation on the part of the Tennant to comply. The good thing is the deposit is held in escrow so while the landlord can delay you getting it back at least they cannot just take the money as is the case here (another thing here that seriously needs to change to protect tenants).
    This bit in bold is incorrect. The LL in Germany is only legally obliged to keep the deposit (usually 3 months' rent btw!) separate from his personal wealth. This is why you see special bank accounts for landlords that pay the minimum legal interest rates on deposits (the tenant must currently get his deposit back + 0.2% interest, subject to change of course)

    The truth is that getting a deposit back (in full) in Germany can legally take a year or so. The LL is entitled to retain such amounts as to cover likely costs which he cannot know precisely until such a time as he is himself billed (city water charges, for example, are billed annually in Autumn time usually, so if a tenant moved out in October/November 2012 he could be waiting almost a year until he is issued with a bill or refund for his water usage).

    Even apart from this aspect, landlords usually don't return deposits for at least a month. Go on to Toytowngermany.com to read threads in English about landlords withholding deposits. It is common here and the money involved usually much bigger (a 3 bed house in a decent part of Stuttgart/Munich etc. will cost you in excess of 2k a month to rent...so three months deposit on one of those is gonna be over 6 grand!!)

    You are correct that strictly speaking the tenant does not need to paint the flat on moving out, but he must return it in the same condition he found it, so practically speaking almost every tenant just paints it to be sure he gets his deposit back. I helped 2 friends in the past 12 months to do just that!


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    #93
    Anynama141
    Closed Accounts Posts: 964 ✭✭✭Anynama141


    Chop Chop wrote: »
    Of people with mortgages, because you can't get one.
    What makes you think I can't get one, don't have one, or even need one? :confused:

    The insult thread is
    > that way.


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    #94
    Captain Chaos
    Registered Users Posts: 11,174 ✭✭✭✭Captain Chaos


    Chop Chop wrote: »
    Jealous much?

    If I went out and blagged a dealer that I could afford a 100k car and "bought" it, then turned around in a few months and said look, I can't afford to pay you back. It would be lifted in the morning, I wouldn't be able go and ask the tax payer to pay the difference and then the car would not be worth 100k anymore either.

    Exact same thing with a house.


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    #95
    murphaph
    Registered Users Posts: 19,022 ✭✭✭✭murphaph


    Villa05 wrote: »
    No, We just need to face up to the fact that if you can't pay your mortgage, you can't keep the house. The same situation must exist for mortgage holders as exists for tenants.

    We have far too many interest groups and the taxpayer is being gouged left, right and centre. We need an interest group for taxpayers and future generations interests. We cannot continue to spend ourselves into Armageddon.
    Germany has one of those as well and it lobbies government to keep spending/taxes at sane levels. The Irish simply aren't interested/motivated enough to form such groups and to attract significant memberships to them.


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    #96
    Chop Chop
    Closed Accounts Posts: 343 ✭✭Chop Chop


    Captain Chaos wrote: »
    If I went out and blagged a dealer that I could afford a 100k car and "bought" it, then turned around in a few months and said look, I can't afford to pay you back. It would be lifted in the morning, I wouldn't be able go and ask the tax payer to pay the difference and then the car would not be worth 100k anymore either.

    Exact same thing with a house.

    There is 100,000 mortgages in distress in this country, tell me this, where is the economic sense in throwing all those people out on the street?:confused:

    Because all I have seen in this thread is people who are renting, begrudging people who are possibly going to get a deal on their mortgages.

    I fail to see how throwing people out on the street is going to benefit the economy. In fact it would probably cost more to re-house them, or do we want them to starve too?


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    #97
    Nino Brown
    Closed Accounts Posts: 1,507 ✭✭✭Nino Brown


    Anynama141 wrote: »
    The problem is that people want to be let off their debt, but keep the property they bought with the debt. Madness - basically asking the taxpayer to pay the difference between the bubble value of the property and what it is worth today, or even worse, asking them to pay the difference between what it cost and what they can afford to pay with a third of their post-tax income (which could be peanuts).

    I'm sorry, but as a taxpayer I'd rather see that money spent on schools, roads and hospitals.

    Yeah but bankruptcy would force them out of the house right? And give the house to someone who can afford the mortgage, giving the banks income on the mortgage again. Surely they don't let people stay in the house?


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    #98
    Anynama141
    Closed Accounts Posts: 964 ✭✭✭Anynama141


    Chop Chop wrote: »
    There is 100,000 mortgages in distress in this country, tell me this, where is the economic sense in throwing all those people out on the street?:confused:
    Why would they have to live on the street? Why don't they rent a place that they can afford? Or sell and buy a place they can afford? If homelessness is redefined as 'not owning a house' then we have already had a massive and growing epidemic of homelessness for the last few years.

    Everybody in this country wants someone else to pay their way - 'the world owes me a living'. :rolleyes:

    Besides, the 100k figure includes a large number of strategic defaulters - the true number is probably closer to 60k.


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    #99
    Anynama141
    Closed Accounts Posts: 964 ✭✭✭Anynama141


    Nino Brown wrote: »
    Yeah but bankruptcy would force them out of the house right? And give the house to someone who can afford the mortgage, giving the banks income on the mortgage again. Surely they don't let people stay in the house?
    In theory - of course the bank could rent the house back to them, and I'm sure that does/will happen a lot.


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    #100
    Nino Brown
    Closed Accounts Posts: 1,507 ✭✭✭Nino Brown


    Anynama141 wrote: »
    In theory - of course the bank could rent the house back to them, and I'm sure that does/will happen a lot.

    That's madness, I know the bank would take a loss on a sale, but if they sold the house, then the interest on the new mortgage would be profit right?, and at least they'd be back on the right track. Renting to somebody who clearly can't or wont pay their way is lunacy.


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    #101
    Chop Chop
    Closed Accounts Posts: 343 ✭✭Chop Chop


    Anynama141 wrote: »
    Why would they have to live on the street? Why don't they rent a place that they can afford? Or sell and buy a place they can afford? If homelessness is redefined as 'not owning a house' then we have already had a massive and growing epidemic of homelessness for the last few years.

    Everybody in this country wants someone else to pay their way - 'the world owes me a living'. :rolleyes:

    Besides, the 100k figure includes a large number of strategic defaulters - the true number is probably closer to 60k.

    Rent, rent, rent.. Why does everyone that rents, wants mortgage payers to rent too? Nobody owes anyone a living, but there is a trend of begrudgery from renters these days that would put hitler to shame in fairness.

    I'm glad I payed my mortgage off in 10 years.


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    #102
    Nino Brown
    Closed Accounts Posts: 1,507 ✭✭✭Nino Brown


    Chop Chop wrote: »
    Rent, rent, rent.. Why does everyone that rents, wants mortgage payers to rent too? Nobody owes anyone a living, but there is a trend of begrudgery from renters these days that would put hitler to shame in fairness.

    I'm glad I payed my mortgage off in 10 years.

    We don't want mortgage payers to rent, that's the whole point of this discussion, we want the mortgage non payers to rent. Did you even read the posts? And the poster you quoted said, rent or buy a place they can afford, why are you jumping on the word rent?


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    #103
    cosbloodymick
    Closed Accounts Posts: 191 ✭✭cosbloodymick


    Captain Chaos wrote: »
    If I went out and blagged a dealer that I could afford a 100k car and "bought" it, then turned around in a few months and said look, I can't afford to pay you back. It would be lifted in the morning, I wouldn't be able go and ask the tax payer to pay the difference and then the car would not be worth 100k anymore either.

    Exact same thing with a house.

    I don't think this is the case but I am open to correction. For instance if you borrow 20k off a car dealer over 5 years to buy a car and after year 2 you lose your job or have a big pay cut and cannot make the repayments then the car dealer will repossess the car and you will have no further liability for the loan as the lender has repossessed the asset against which the loan was taken. This is not the case with a house. If you cannot make the repayments the lender can repossess the asset against which the loan was taken but you still have a liability for the loan if the sale of the house does not reach the mortgage value.
    In other countries once the house has been repossessed there is no further liability on the borrower for the mortgage.


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    #104
    Chop Chop
    Closed Accounts Posts: 343 ✭✭Chop Chop


    Nino Brown wrote: »
    We don't want mortgage payers to rent, that's the whole point of this discussion, we want the mortgage non payers to rent. Did you even read the posts? And the poster you quoted said, rent or buy a place they can afford, why are you jumping on the word rent?

    Why can't they rent the place they originally bought? All I can see it outright begrudgery from the "throw them to the lions crowd" If you lose your home, you still owe the money you paid for it, even when you give the keys back.


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    #105
    Nino Brown
    Closed Accounts Posts: 1,507 ✭✭✭Nino Brown


    Chop Chop wrote: »
    Why can't they rent the place they originally bought? All I can see it outright begrudgery from the "throw them to the lions crowd" If you lose your home, you still owe the money you paid for it, even when you give the keys back.

    Unless you declare bankruptcy.


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    #106
    MMAGirl
    Registered Users Posts: 484 ✭✭MMAGirl


    Chop Chop wrote: »
    There is 100,000 mortgages in distress in this country, tell me this, where is the economic sense in throwing all those people out on the street?:confused:

    Because all I have seen in this thread is people who are renting, begrudging people who are possibly going to get a deal on their mortgages.

    I fail to see how throwing people out on the street is going to benefit the economy. In fact it would probably cost more to re-house them, or do we want them to starve too?

    I'm seeing a lot of "Repossess peoples houses so I can get one of their houses at a discount" both on boards and all over the place too. When you ask a few strategic questions in conversations where people are demanding repossessions it always comes out in the end. If I'm honest I would probably put my hand in and pick up some investment properties too if repossessions caused rices to fall further, but I wouldnt be out there demanding the banks take peoples homes either.

    Irish people hate to see anyone else doing any better than themselves in anyway. See it everywhere. We should be used to that by now.


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    #107
    Chop Chop
    Closed Accounts Posts: 343 ✭✭Chop Chop


    Nino Brown wrote: »
    Unless you declare bankruptcy.

    Then what do you do? Bankruptcy is not an easy thing. You are like a leper to every financial institution in the country. It's not just a case of "I'll declare myself bankrupt, problem solved" There are serious ramifications attached to bankruptcy.


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    #108
    MMAGirl
    Registered Users Posts: 484 ✭✭MMAGirl


    Chop Chop wrote: »
    Then what do you do? Bankruptcy is not an easy thing. You are like a leper to every financial institution in the country. It's not just a case of "I'll declare myself bankrupt, problem solved" There are serious ramifications attached to bankruptcy.

    In Ireland bankruptcy is particularly bad too.
    Im sure in all those other countries on that graph, peoples houses are repossessed and after that life becomes easier for them due to the countries bankruptcy laws. Wont be the case in Ireland


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    #109
    Nino Brown
    Closed Accounts Posts: 1,507 ✭✭✭Nino Brown


    Chop Chop wrote: »
    Then what do you do? Bankruptcy is not an easy thing. You are like a leper to every financial institution in the country. It's not just a case of "I'll declare myself bankrupt, problem solved" There are serious ramifications attached to bankruptcy.

    Yes I know, but it happens all the time, its not supposed to be a pleasant experience. They should be a "leper" to financial institutions, they are debt defaulters. It's rough few years, but then people get back on their feet, debt free, and everybody can move on.


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    #110
    Anynama141
    Closed Accounts Posts: 964 ✭✭✭Anynama141


    Chop Chop wrote: »
    Rent, rent, rent.. Why does everyone that rents, wants mortgage payers to rent too? Nobody owes anyone a living, but there is a trend of begrudgery from renters these days that would put hitler to shame in fairness.
    What makes you think I rent? You can't come up with a better counterargument that accusing people of being renters? (and I'm not sure that's a crime either, to be honest)
    Chop Chop wrote: »
    I'm glad I payed my mortgage off in 10 years.
    Big round of applause for you. :confused:


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    #111
    Chop Chop
    Closed Accounts Posts: 343 ✭✭Chop Chop


    Nino Brown wrote: »
    Yes I know, but it happens all the time, its not supposed to be a pleasant experience. They should be a "leper" to financial institutions, they are debt defaulters. It's rough few years, but then people get back on their feet, debt free, and everybody can move on.

    Jesus, you make it sound so easy. Do you know what sort of a life you would have with no financial backing whatsoever?

    You're living in cloud cuckoo land, "debt free and everyone can move on" Wow, financial institutions DO NOT forget, regardless of what is supposed to happen. Do you know anyone or have you spoke to anyone that went bankrupt in this country? It's not a pretty sight. Even after all is said and done, you will still be turned down for a basic personal loan, even by the credit union.


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    #112
    Anynama141
    Closed Accounts Posts: 964 ✭✭✭Anynama141


    cosbloodymick wrote: »
    I don't think this is the case but I am open to correction. For instance if you borrow 20k off a car dealer over 5 years to buy a car and after year 2 you lose your job or have a big pay cut and cannot make the repayments then the car dealer will repossess the car and you will have no further liability for the loan as the lender has repossessed the asset against which the loan was taken. This is not the case with a house. If you cannot make the repayments the lender can repossess the asset against which the loan was taken but you still have a liability for the loan if the sale of the house does not reach the mortgage value.
    In other countries once the house has been repossessed there is no further liability on the borrower for the mortgage.
    In a few other countries. Even in the US, it's a minority of states.

    Of course, the big difference is that people knew the terms and conditions when they took out the loan ("your property may be at risk if you do not keep up payments" or whatever in every ad) and banks lent on those conditions - interest rates would have been higher if they were making more risky non-recourse loans.


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    #113
    username123
    Closed Accounts Posts: 7,484 ✭✭✭username123


    Anynama141 wrote: »
    Why would they have to live on the street? Why don't they rent a place that they can afford? Or sell and buy a place they can afford? If homelessness is redefined as 'not owning a house' then we have already had a massive and growing epidemic of homelessness for the last few years.

    Everybody in this country wants someone else to pay their way - 'the world owes me a living'. :rolleyes:

    Besides, the 100k figure includes a large number of strategic defaulters - the true number is probably closer to 60k.

    I dont even know where to start with this. Its clear you dont understand the issue for many people.

    Most people who cannot afford to make any kind of mortgage repayments, cannot afford rent either. Currently they cannot get rent allowance or social housing because their name is on a mortgage. They are in limbo - they cant get assistance for housing, but they cant pay their mortgage, but the banks wont move on it to repossess. They cant sell because the banks block the sale due to negative equity. The banks dont want to end up with an unsecured loan.

    The tax payer is going to end up paying one way or the other. Either some kind of debt forgiveness happens, OR, the banks finally move on repossession, leave the original mortgage holder owing a massive sum and the original mortgage holder - now free from his mortgage - applies to the state for housing assistance in the form of rent allowance or social housing.

    The government dont want a massive slew of people suddenly applying for housing assistance - in case you hadnt noticed the country is bankrupt - so they are acting in collusion with the banks to not repossess and effectively kick the can down the road.

    And strategic defaulters - yes sure, there will be some, but dont let the spin fool you. Not only is the mortgage arrears crisis much much more serious than the figure spinning is showing (the criteria that shows a mortgage in trouble conveniently ignores many mortgages in trouble), but in fact, the mortgage arrears crisis isnt even the problem in this country - its simply a symptom of the real problem - which is personal insolvency.

    To delude yourself that the tax payer is not going to be paying for this is just silly. Debt forgiveness seems to annoy people, but it would actually probably work out as a cheaper solution than the state trying to house the mortgage holders who are in trouble - and not to mention a slew of repossessed houses appearing on the market will only drive the prices down further - leaving more people in negative equity and unable to sell if they need to and depressing the economy further.


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    #114
    Chop Chop
    Closed Accounts Posts: 343 ✭✭Chop Chop


    Anynama141 wrote: »
    What makes you think I rent? You can't come up with a better counterargument that accusing people of being renters? (and I'm not sure that's a crime either, to be honest)

    Big round of applause for you. :confused:

    Because it's such a hot topic for you, it's all I hear all over the place from people that rent.


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    #115
    Anynama141
    Closed Accounts Posts: 964 ✭✭✭Anynama141


    MMAGirl wrote: »
    I'm seeing a lot of "Repossess peoples houses so I can get one of their houses at a discount" both on boards and all over the place too.
    There is no discount, there is only market price.

    This is the situation:

    Person A and person B wanted to buy a house. Person A borrowed as much as they could and borrowed a deposit from the credit union, and managed to scrape together more money than person B was willing to pay, bidding the price of the house up (and contributing to the bubble).

    Person B shrugged her shoulders, said 'this is madness', and decided to rent for the next few years.

    Then the bubble bursts, person A stops paying their mortgage, and now person A expects person B to pay not only their own rent, but also pay extra taxes to keep person A in the house that person B wasn't willing or able to afford in the first place. And perhaps, with these higher taxes, B will never be able to afford a house while A sits in her house and laughs.

    And you think this is fair?


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    #116
    Anynama141
    Closed Accounts Posts: 964 ✭✭✭Anynama141


    Chop Chop wrote: »
    Jesus, you make it sound so easy. Do you know what sort of a life you would have with no financial backing whatsoever?

    You're living in cloud cuckoo land, "debt free and everyone can move on" Wow, financial institutions DO NOT forget, regardless of what is supposed to happen. Do you know anyone or have you spoke to anyone that went bankrupt in this country? It's not a pretty sight. Even after all is said and done, you will still be turned down for a basic personal loan, even by the credit union.
    Actually they are only allowed to keep records for 7 years. Data protection act, and all that.

    But don't let facts get in your way...


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    #117
    username123
    Closed Accounts Posts: 7,484 ✭✭✭username123


    Anynama141 wrote: »
    Actually they are only allowed to keep records for 7 years. Data protection act, and all that.

    But don't let facts get in your way...

    12 years for bankruptcy in Ireland, but dont let the facts get in your way.

    Its widely known that its never off your record in Ireland though.


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    #118
    Anynama141
    Closed Accounts Posts: 964 ✭✭✭Anynama141


    Chop Chop wrote: »
    Because it's such a hot topic for you, it's all I hear all over the place from people that rent.
    For your information I own a house in London and a house in the West of Ireland. You don't need to have a personal stake to want to see justice done, do you?

    You sound a lot like someone hoping for debt sharing so you can benefit.


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    #119
    Chop Chop
    Closed Accounts Posts: 343 ✭✭Chop Chop


    Anynama141 wrote: »
    Actually they are only allowed to keep records for 7 years. Data protection act, and all that.

    But don't let facts get in your way...

    They never forget. Fact. My father in Law went bankrupt 25 years ago and even in the boom couldn't get a washer from any financial institution.


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    #120
    Chop Chop
    Closed Accounts Posts: 343 ✭✭Chop Chop


    Anynama141 wrote: »
    For your information I own a house in London and a house in the West of Ireland. You don't need to have a personal stake to want to see justice done, do you?

    You sound a lot like someone hoping for debt sharing so you can benefit.

    Not really, my stance is the economic stupidity that's attached to throwing people out of their homes, which is what you ultimately want , isn't it?


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    #121
    MMAGirl
    Registered Users Posts: 484 ✭✭MMAGirl


    Anynama141 wrote: »
    Actually they are only allowed to keep records for 7 years. Data protection act, and all that.

    But don't let facts get in your way...

    Oh that post is gonna hurt you. LOL


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