Ireland, where repaying your mortgage is optional

Anynama141

username123 wrote: »

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.

So repossess them. If they can't pay anything at all, why should they get a free house? The government can then pay rent for them to the bank - unless it's a nice house, in which case they can move to something more basic. Simple and fair.

username123 wrote: »

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.

Or, if working, rents like everyone else. If the taxpayer is paying either way, they should get value for money.

There's also the personal insolvency scheme and reformed 3-year bankruptcy out there for hopeless cases.

username123 wrote: »

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.

Wait a second - you just pointed out that the government/taxpayer is paying either way! So we either pay through the banks (through debt sharing) or through more direct taxes. Let's go with the route that gets the taxpayer some value for money - repossess non-payers and the 'won't pay' crowd will suddenly cop on.

username123 wrote: »

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.

The spin has always been 'ignore moral hazard' and 'strategic default is a myth' - when there is huge statistical evidence and rampant anecdotal evidence of strategic default. And strategic default is mainly the preserve of the middle and upper-middle classes, I would point out.

username123 wrote: »

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.

The only people deluding themselves are those who think that 'free houses for everyone' is a viable plan. The taxpayer IS paying - the whole point is that we shouldn't be ripping off the prudent to bail out the foolish.

username123

Anynama141 wrote: »

The only people deluding themselves are those who think that 'free houses for everyone' is a viable plan. The taxpayer IS paying - the whole point is that we shouldn't be ripping off the prudent to bail out the foolish.

Who thinks this? Anything to back this assertion up?

I dont think you get it, some amount of debt forgiveness will cost the economy less than the state having to house people. Im not sure where you are getting the myth that people who cant pay their mortgage can pay rent - with what money?

The personal insolvency and reformed bankruptcy you refer to do not exist yet. One of the many reasons why there is such stasis.

Anynama141

username123 wrote: »

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.

You've heard about bankruptcy reform, right?

Also, I was wrong about how long the information is kept for - it's FIVE years.

How long is my credit history recorded for?
All records remain on the ICB database for 5 years once the account has been completed. This is the situation irrespective of whether you repaid the debt or you failed to complete payments.

Nino Brown

username123 wrote: »

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.

Maybe I'm missing something here but to me that that reads that that you get discharged from bankruptcy after 3 years

As well as introducing 3 new debt resolution processes, the Act will introduce automatic discharge from bankruptcy, subject to certain conditions, after 3 years as opposed to 12 years at present.

And makes no mention of how long the banks retain a record of a bankruptcy

Anynama141

Chop Chop wrote: »

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?

In what sense is a house that you aren't paying for 'your house'?

A renter's house is just as much their home. Are you opposed to them being 'thrown out' if they stop paying?

Anynama141

MMAGirl wrote: »

Oh that post is gonna hurt you. LOL

Fortunately I was able to back it up with facts. LOL

Anynama141

username123 wrote: »

I dont think you get it, some amount of debt forgiveness will cost the economy less than the state having to house people. Im not sure where you are getting the myth that people who cant pay their mortgage can pay rent - with what money?

What makes you think that people with NO money to pay towards rent or mortgage should be granted ownership of a house worth - say - 200k?

Chop Chop

Anynama141 wrote: »

So repossess them. If they can't pay anything at all, why should they get a free house?

They shouldn't, they are in the minority.

Anynama141 wrote: »

The spin has always been 'ignore moral hazard' and 'strategic default is a myth' - when there is huge statistical evidence and rampant anecdotal evidence of strategic default. And strategic default is mainly the preserve of the middle and upper-middle classes, I would point out.

Strategic defaulters is a minority also.

Anynama141 wrote: »

The only people deluding themselves are those who think that 'free houses for everyone' is a viable plan. The taxpayer IS paying - the whole point is that we shouldn't be ripping off the prudent to bail out the foolish.

Who or where have you heard of this "free house plan?" I think that's the crux of your argument, every distressed mortgage holder is looking for a free house.

username123

Anynama141 wrote: »

What makes you think that people with NO money to pay towards rent or mortgage should be granted ownership of a house worth - say - 200k?

Where did I say they should? But it makes no economic sense to just kick them out.

How does it improve the overall economic situation? Now you have someone getting tax payer money to rent, having a massive debt rendering them economically useless and there is absolutely no incentive for them to better themselves and contribute to the economy - whats the point?

Whereas if you revalue their mortgage, perhaps they can keep paying it and continue to be a useful member of the economy. Or sell because they no longer have NE and buy somewhere cheaper.

What you suggest is far more costly.

username123

Anynama141 wrote: »

You've heard about bankruptcy reform, right?

Also, I was wrong about how long the information is kept for - it's FIVE years.

Nino Brown wrote: »

Maybe I'm missing something here but to me that that reads that that you get discharged from bankruptcy after 3 years

As well as introducing 3 new debt resolution processes, the Act will introduce automatic discharge from bankruptcy, subject to certain conditions, after 3 years as opposed to 12 years at present.

And makes no mention of how long the banks retain a record of a bankruptcy

Its not here yet - they keep putting it off.

For now, you still can’t access the processes provided for under the Act, the Debt Relief Notices, Personal Insolvency or Bankruptcy. It just means that the Insolvency Service is up and running. Pressure still needs to be brought on the justice minister, Alan Shatter to commence the entire legislation which he is being frogmarched into introducing, by the IMF – if we were relying on the soporific minister alone to reform our draconian bankruptcy laws, we would have a very long wait indeed.

Anynama141

Chop Chop wrote: »

They shouldn't, they are in the minority.

Do you have any stats to support this claim?

Chop Chop wrote: »

Strategic defaulters is a minority also.

Again, any stats? I tend to agree with you that it's a minority, but it's a large minority. The graph in the first post speaks volumes.

Chop Chop wrote: »

Who or where have you heard of this "free house plan?" I think that's the crux of your argument, every distressed mortgage holder is looking for a free house.

They want to keep the asset but lose the loan. Or pay only as much of the loan as they feel they should. Or they want forbearance, or split mortgages, or lots of other things.

There's a wide spectrum of people out there looking for different things. What it boils down to is that those who can't or won't pay should lose the asset if they've had 2 years to sort themselves out and failed. What happens next is certainly open to debate - I can see a reasonable argument for writing off some or all of the remaining debt (i.e. dumping it on the taxpayer).

Anynama141

username123 wrote: »

Where did I say they should? But it makes no economic sense to just kick them out.

...and you can see the economic logic of leaving them in situ and in legal ownership from the graph in the opening post.

Frankly, I'm amazed that anybody is bothering to pay their mortgage in Ireland today.

Phoebas

username123 wrote: »

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

username123 wrote: »

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

Can you back this assertion up with some evidence?

Nino Brown

username123 wrote: »

How does it improve the overall economic situation? Now you have someone getting tax payer money to rent, having a massive debt rendering them economically useless and there is absolutely no incentive for them to better themselves and contribute to the economy - whats the point?

If repossessions don't work, why has it been done in so many countries for so many years. The US kicked out delinquent homeowners and resold the properties, and their market is recovering because of it. We cant keep people in properties they cant afford, and its totally unfair to offer tax payer money to fund their bad investment.

username123

Phoebas wrote: »

Can you back this assertion up with some evidence?

No - the words "widely known" are an indicator that it was my opinion - had it been a verifiable fact I would have stated it as such.

Can you produce any evidence to the contrary?

Chop Chop

Anynama141 wrote: »

They want to keep the asset but lose the loan. Or pay only as much of the loan as they feel they should. Or they want forbearance, or split mortgages, or lots of other things.

What's wrong with split mortgages? I think it's a great idea. The person will pay back the loan in full but in two halves. Ultimately they pay back the loan in full.

You have just shot yourself in the foot there, the begrudgers are in the majority in this country unfortunately. "Well if I can't get it then they shouldn't"

I feel sorry for people that don't understand the economic implications of making people homeless.

username123

Nino Brown wrote: »

If repossessions don't work, why has it been done in so many countries for so many years. The US kicked out delinquent homeowners and resold the properties, and their market is recovering because of it. We cant keep people in properties they cant afford, and its totally unfair to offer tax payer money to fund their bad investment.

Repossessions do work - but not in a very depressed housing market with a massive mortgage arrears problem. There is no sense in a bank repossessing an asset worth much much less than the outstanding mortgage. They can survive some amount of write down - but the problem in Ireland is too big. In Iceland they revalued the mortgages because they faced a similar problem.

Anynama141

username123 wrote: »

No - the words "widely known" are an indicator that it was my opinion - had it been a verifiable fact I would have stated it as such.

Can you produce any evidence to the contrary?

Perhaps 'widely believed' is the term you wanted then.

I've already posted proof that the Irish Credit Bureau only keeps your records for 5 years.

username123

Anynama141 wrote: »

...and you can see the economic logic of leaving them in situ and in legal ownership from the graph in the opening post.

Frankly, I'm amazed that anybody is bothering to pay their mortgage in Ireland today.

Oh I get it. You just want to punish the unlucky - the economic sense of alternatives doesnt interest you.

I dont know anyone advocating free houses. I dont know anyone real (ie not someone posting anon on an internet forum) advocating throwing people out of their homes. There are many middle grounds. I realise you dont really get it, so Ill leave you to it. Hopefully the people making the big decisions here will see that an extreme in either direction is the wrong thing to do. Have a good day!

username123

Anynama141 wrote: »

I've already posted proof that the Irish Credit Bureau only keeps your records for 5 years.

They are not the only agency who keep financial records.

Anynama141

Chop Chop wrote: »

What's wrong with split mortgages? I think it's a great idea. The person will pay back the loan in full but in two halves. Ultimately they pay back the loan in full.

I didn't say there's anything wrong with split mortgages - they may be a solution for some people. It's hardly a solution for those people who are paying nothing towards their mortgages, is it?

Chop Chop wrote: »

You have just shot yourself in the foot there, the begrudgers are in the majority in this country unfortunately. "Well if I can't get it then they shouldn't"

I'm not sure I follow your logic here. Do you really think tax money should be taken away from education, health etc. and funnelled to people who aren't paying their mortgages? Is that begrudgery? Do you begrudge a child a decent education, or hospital care?

Chop Chop wrote: »

I feel sorry for people that don't understand the economic implications of making people homeless.

I was homeless for many years. Didn't seem to harm the economy then. My brother is homeless today, and I've many homeless friends - and most of my friends were homeless during the property bubble. That didn't harm the economy either, it seems.

Oh wait - I forgot that when you say 'homeless' you mean 'not actually an house OWNER'.

Joe Hart

Chop Chop wrote: »

What's wrong with split mortgages? I think it's a great idea. The person will pay back the loan in full but in two halves. Ultimately they pay back the loan in full.

You have just shot yourself in the foot there, the begrudgers are in the majority in this country unfortunately. "Well if I can't get it then they shouldn't"

I feel sorry for people that don't understand the economic implications of making people homeless.

I don't own a house. Would you consider me homeless?

Anynama141

username123 wrote: »

They are not the only agency who keep financial records.

Who else keeps such records? And how do they know of all your dealings?

And are they aware of the Data Protection Act? (because if you are right, I'm about to make a lot of money by suing them)

Anynama141

username123 wrote: »

Oh I get it. You just want to punish the unlucky - the economic sense of alternatives doesnt interest you.

I dont know anyone advocating free houses. I dont know anyone real (ie not someone posting anon on an internet forum) advocating throwing people out of their homes. There are many middle grounds. I realise you dont really get it, so Ill leave you to it. Hopefully the people making the big decisions here will see that an extreme in either direction is the wrong thing to do. Have a good day!

What is your position on renters who stop paying their rent?

For some reason, you guys refuse to answer this one.

Chop Chop

Anynama141 wrote: »

I didn't say there's anything wrong with split mortgages - they may be a solution for some people. It's hardly a solution for those people who are paying nothing towards their mortgages, is it?

The thrust of your post pretty much alludes to the fact that you have a problem with it.

Anynama141 wrote: »

I'm not sure I follow your logic here. Do you really think tax money should be taken away from education, health etc. and funnelled to people who aren't paying their mortgages? Is that begrudgery? Do you begrudge a child a decent education, or hospital care?

Where in the name of God do you get this utter bollocks from? The health system was well and truley fecked before the mortgage crises. Yes I would prefer my tax money to be funnelled to a consultant on €250,000 a year for 30 hours work.

Anynama141 wrote: »

I was homeless for many years. Didn't seem to harm the economy then. My brother is homeless today, and I've many homeless friends - and most of my friends were homeless during the property bubble. That didn't harm the economy either, it seems.

Oh wait - I forgot that when you say 'homeless' you mean 'not actually an house OWNER'.

You just don't want anyone to get any help at all, regardless of what it will do to the country. "didn't do me any harm, throw them out on the street". It's just jealousy, other people have something you don't have and you have a big problem with it.

Economics, unemployment, and the state of the country.....out the window.


I think I'm done here.

lima

I'd rather see people kicked out of their homes and moving to the arse end of rural Ireland to rent cheaply than get debt forgiveness.

The sense of entitlement of Irish people is incredible!! you should see the perspective I can see from being a well traveled individual who could see how mad it was getting!

Forget about the effects on the economy etc. for a second..

You purchase something on credit, you can't/won't pay back the monthly loans, therefore you need to get that something taken away from you as it is not yours.

Once this happens enough times, then property prices will go down to their true value (NOT discount) and thus we can all start again in this nice little capitalist world we live in.

Meanwhile the people who's houses got repossessed? Ain't my problem...

:-)

Chop Chop

lima wrote: »

I'd rather see people kicked out of their homes and moving to the arse end of rural Ireland to rent cheaply than get debt forgiveness.

The sense of entitlement of Irish people is incredible!! you should see the perspective I can see from being a well traveled individual who could see how mad it was getting!

Forget about the effects on the economy etc. for a second..

You purchase something on credit, you can't/won't pay back the monthly loans, therefore you need to get that something taken away from you as it is not yours.

Once this happens enough times, then property prices will go down to their true value (NOT discount) and thus we can all start again in this nice little capitalist world we live in.

Meanwhile the people who's houses got repossessed? Ain't my problem...

:-)

Those people are prety much in the minority, The OP said in the opening post that 100,000 people were not paying anything towards their mortgage, which is utter bollocks. Then alluded to the fact that he/she had an issue with split mortgages, which can only be obtained by people that are paying their mortgage but are missing payments or part of.

I'm just waiting for the "goodwin post" to arrive at this stage. It stinks of downright begrudgery and jealousy.

People that pay nothing should be booted out, but the majority are paying something, so re-structuring IS a good idea. Saying that 100,000 people are not paying anything towards their mortgage is horse shíte.

Nino Brown

Chop Chop wrote: »

People that pay nothing should be booted out, but the majority are paying something, so re-structuring IS a good idea. Saying that 100,000 people are not paying anything towards their mortgage is horse shíte.

I don't think anybody is advocating that people who are capable of their mortgage over a longer period should be kicked out. But if a mortgage is restructured on a sustainable path is it considered to be in arrears? Because if not, that's not what were are talking about on this thread.
We're (or at least I am) talking about people who are paying nothing, and people who would be willing to pay but have no realistic prospect of ever paying the mortgage, and they need to be moved on for the market to recover.

MMAGirl

Anynama141 wrote: »

Fortunately I was able to back it up with facts. LOL

Where?
Jaysus you are like a politician now.
Go read some actual verifiable Irish bankruptcy stories and then come back and pretend you know what you are talking about again.

Chop Chop

Nino Brown wrote: »

I don't think anybody is advocating that people who are capable of their mortgage over a longer period should be kicked out. But if a mortgage is restructured on a sustainable path is it considered to be in arrears? Because if not, that's not what were are talking about on this thread.
We're (or at least I am) talking about people who are paying nothing, and people who would be willing to pay but have no realistic prospect of ever paying the mortgage, and they need to be moved on for the market to recover.

I think the OP is on that side of the fence tbh. Take the quote below as pretty much why the thread was started, "they have something I don't have so I don't like it"

Anynama141 wrote: »

They want to keep the asset but lose the loan. Or pay only as much of the loan as they feel they should. Or they want forbearance, or split mortgages, or lots of other things.