Government to pay mortgage arrears *Mod Note in Opening Post*

Villa05

BoatMad wrote:

I fond it hard to fathom, the argument, that people that are financially capable of meeting their debts, seen to wish that those, for a variety of circumstances, that cannot, should be subject to some sort of victorian system of punishment.

There is no Victorian punishment. We have a motgage holder in trouble on this form getting the utility value of the house for 400 p/m. Renters have to pay €900p/m.
Every other country would reposses in such circumstances. Hardly victorian for the mortgage holder. A bit less of the drama and tears please

desertcircus

BoatMad wrote: »

business don't go bankrupt. only People can be bankrupted, Business can be liquidated , ( voluntary or forced) or placed in the hands of a receiver ( the two are different )

throwing families out of homes to justify a " balance Sheet" in a bank, is ridiculous

personally the banks having been capitalised to accommodate losses, should just in my opinion, write down these loans ( with clawback provisions) , but whats happening is an attempt by the banks to have their bread buttered on both sides

If a bank hasn't written off a loan, then no loss on it has been accounted for. Writing off mortgage arrears on a grand scale would require further recapitalisation on a grand scale, and would effectively reduce to zero the value of the State's holdings. The money currently owed in arrears has to either be written off or paid. Write offs would be a disaster, and the State paying it would be wildly irresponsible.

Triangla

The whole bank bailout - was that not done to fund the banks and their massive loanbooks - have we not already given banks the funding to write down underperforming loans and mortgages?

I know AIB lobbed a billion to prop up their pension pot but besides that, what has been done with the remaining billions? Has there ever been an account given of where the money went for each institution?

This is a bit of a joke isn't it - the words smash and grab come to mind.

http://www.independent.ie/business/irish/aib-beats-pension-crisis-after-11bn-loans-bailout-30740410.html

http://www.independent.ie/business/irish/aib-uses-pension-bailout-to-pay-exchiefs-up-to-500k-28825993.html

https://namawinelake.wordpress.com/2012/11/03/who-knew-we-were-bailing-out-more-than-just-bondholders-when-we-bailed-out-the-banks-bank-pension-funds/

http://www.irishexaminer.com/ireland/aib-gets-a-free-pass-on-euro21bn-it-owes-us-297243.html

Turkish1

Drumpot wrote: »

Emotive bull**** !!! That's what hoy think of people having to move house under duress? It's emotive bullsh*t?. That's some fighting talk.... If you can't understand the psychological trauma this can have on people you aren't really factoring in all The variables even if they are emotive they are still potentially detrimental to the mental health of individuals and families that could cost the state more in the long run.

Its very easy for PC warriors to trot out figures and solutions to financial situations that can have more complex emotional issues.

I'm not completely against your example, but if you think it's a simple mathematical solution you just don't fully understand the entire dynamics of relocating people under duress.

Do you think the stress of being unable to pay your mortgage, with debt piling up, scraping by trying to pay as much as possible to keep the house (while not really getting anywhere with it), trying to hide your money problems from children/neighbours/colleagues amongst other things is not as damaging (I would argue it is actually more damaging) than having to move house to something smaller/more affordable?

Peist2007

BoatMad wrote: »

Rent supplement etc

a freeloader is someone gaining from this process, ( rather like saying that someone on the " dole" is "gaining" in the process). Clearly the distressed householder is not gaining per se.

All that is being considered in infact a form of " income support " , a situation that is quite common in many areas of this states social welfare code.

They are gaining from the process :rolleyes:

Uncle Ben

[Deleted User] wrote: »

Reading the article, it looks like a typical Sindo story, definite headline but article reading much more vague.

If the coalition try something like this it will be the end of them. This is more like something that SF would propose.

One half of the present govt. appear to be warming to it. Along with collective bargaining legislation and pay restoration for PS one could only imagine that an election is imminent.

KomradeBishop

Zubeneschamali wrote: »

I paid my mortgage off already - can I have my €300K of other people's money in twenties, please? I promise to blow it all in a demented binge use it as a targeted economic stimulus within a tightly defined period.

If this was done as 'Quantitative Easing for the people' - as the part of my post you quoted said - then sure, you'd get a huge lump sum along with everyone else. That's not what this particular policy is though.

That's the only fair way to do this - and it's politically impossible - so what you have left, is a wide array of solutions that are going to be unfair to one section of society or another, no matter what.

The_Morrigan

Locked pending review

EDIT:

Right I am re-opening this as it is a very good topic and worthy of discussion, however I'm not happy about some of the new arrivals to the forum.

The charter can be found here: http://www.boards.ie/vbulletin/showthread.php?t=2057400859 I suggest that everyone reads it and becomes familiar with the remit of this forum and more importantly the ethos.
There are a lot of different situations here, from professional landlords, accidental landlords, homeowners, renters and those in receipt of assistance from the Govt. This is not the place to air your political views, nor is it acceptable to make gross generalisations about an entire faction of society - neither will be tolerated here and thread bans will be issued to keep the thread on topic.

A Summary of Mod notes currently in the thread - which I've also copied into the OP are below.

Folks, just a couple of things:
* can you please keep in mind this is A&P, not the politics or the economics forum, try stay within the remit of this forum.
* please don't personalise your posts towards others, this is a general discussion so posters own situations shouldn't be jumped on and judged.
* can you curtail the profanities please, there is absolutely no need to use foul language to express yourself in this forum.
*attack the post, not the poster.
* don't breach the charter, if in doubt re-read it.

Frigga_92

BoatMad wrote: »

its a simple case of begrudgery (sic). simply because (i) (one) is in financial good health ( for whatever reason) , I don't want those that are not so lucky to gain an advantage that I haven't received.

( hence the croissants advantage argument)

Thats all the opponents of this measure are expressing , I am not receiving " an advantage " so I don't want (you ) receiving it also

I pay tax, I don't get children's allowance, hence no-one should get it, type of argument .

Begrudery

I think you'll find that the majority of people opposed to this measure and other such measures, debt forgiveness for example, are not actually in good financial health.
The majority of the people opposed to this are barely scraping by, people who are working hard for the same wage or less than what they were earning 5 years ago, maybe even 10 years ago, just about paying their mortgage, some months having to put off paying X bill straight away because the mortgage had to be paid, their children don't get to go on school trips because the mortgage had to be paid, no extravagant luxuries because the mortgage had to be paid because the mortgage gets looked after above all else because that is what keeps the roof of their head.

NIMAN

Couple of things I have concerns about.

1) Apparently local councils are being mentioned as those that will help these people financially. Are they to get extra funds for this? As I know a lot of CoCo's are struggling for money. Will we see a deterioration of other services as money is ring-fenced for this?

2) If the Gov do decide to help out people, thats fine but what's in it for the tax-payer? Surely it would be better if the Gov owed x% of the property depending on how much they put in, at least that way they will have an asset that might be worth more in the future if the house is ever sold.

NewDirection

I'd like to see some details on what is proposed, there are zero details in the article.

It's a pity this topic descends into people who bought in the boom vs those who didn't. Plus the comment that this is transferring money from the taxpayer to the banks is inaccurate until we see details.

I think if it was set up right it could be a good thing, but it would be very situation dependent. Some debts are just too big and default is the only option.

Take an example of someone who lost their job and now cant afford their mortgage.
Option 1 would be, bank repossesses house. Joe Bloggs now out on the street, and is now eligible for rent supplement.
Option 2 would be , restructure for interest only mortgage, Joe Bloggs now gets some sort of new mortgage supplement.

Both scenarios have home receiving money off the state, the only difference is that he's still in his family home. He's effectively renting off the bank instead of a landlord.

I know its a simplistic way of looking at it, but I think if done right it can be a good thing for a small section of society, without too much extra cost to the taxpayer when you take thebig picture into account.

Turkish1

NewDirection wrote: »

I'd like to see some details on what is proposed, there are zero details in the article.

It's a pity this topic descends into people who bought in the boom vs those who didn't. Plus the comment that this is transferring money from the taxpayer to the banks is inaccurate until we see details.

I think if it was set up right it could be a good thing, but it would be very situation dependent. Some debts are just too big and default is the only option.

Take an example of someone who lost their job and now cant afford their mortgage.
Option 1 would be, bank repossesses house. Joe Bloggs now out on the street, and is now eligible for rent supplement.
Option 2 would be , restructure for interest only mortgage, Joe Bloggs now gets some sort of new mortgage supplement.

Both scenarios have home receiving money off the state, the only difference is that he's still in his family home. He's effectively renting off the bank instead of a landlord.

I know its a simplistic way of looking at it, but I think if done right it can be a good thing for a small section of society, without too much extra cost to the taxpayer when you take thebig picture into account.

I think a few big things are being missed by some/most posters who are in favour of this plan (broadly speaking - ie some sort of govt payment to keep them in home). It we take it purely on practical terms:

It will cost the taxpayer more in comparison to repossessions (I am not proposing repo's across the board btw). A lot of the people that would end up losing the house would be able to afford to rent a cheaper alternative to the mortgage. Thus it leaves no direct financial aid needed by govt.

Even if we imagined no cost difference between a repo& rent supplement v this scheme - it still would not work. Yes it would be nice to be able to keep people in the property they are currently in. However, I can guarantee with absolute certainty that if this happens that my neighbour/friend/colleague etc who hear that the person living down the road is keeping his home - that they will stop paying.

You may say that it would be a small amt of people that would do this but it is not the case, it would spread like wildfire with everyone with their hands out while wanting to stay in their 3/4/5 bed house in Leitrim/cork/Galway/dundrum/clontarf

NewDirection

Turkish1 wrote: »

I think a few big things are being missed by some/most posters who are in favour of this plan (broadly speaking - ie some sort of govt payment to keep them in home). It we take it purely on practical terms:

It will cost the taxpayer more in comparison to repossessions (I am not proposing repo's across the board btw). A lot of the people that would end up losing the house would be able to afford to rent a cheaper alternative to the mortgage. Thus it leaves no direct financial aid needed by govt.

Even if we imagined no cost difference between a repo& rent supplement v this scheme - it still would not work. Yes it would be nice to be able to keep people in the property they are currently in. However, I can guarantee with absolute certainty that if this happens that my neighbour/friend/colleague etc who hear that the person living down the road is keeping his home - that they will stop paying.

You may say that it would be a small amt of people that would do this but it is not the case, it would spread like wildfire with everyone with their hands out while wanting to stay in their 3/4/5 bed house in Leitrim/cork/Galway/dundrum/clontarf

Could we not use exactly the same criteria used to determine amount of rent supplement and eligible properties as that scheme to determine suitable canditates for mortgage supplement? And the same level of means testing?

on_my_oe

There is a difference in that a mortgage holder benefits twice over, first by retaining a roof over their head but secondly they will benefit financially by (any) increase in property value.

bjork

on_my_oe wrote: »

There is a difference in that a mortgage holder benefits twice over, first by retaining a roof over their head but secondly they will benefit financially by (any) increase in property value.

and by paying less than rental market rates $$$$

Cushie Butterfield

Of course it was only a matter of time before the entire matter of distressed mortgages hit the headlines once more, as no solution was ever found or put in place when it should have been (around the time of Bailoutgate). MARP was for the most part just a temporary solution papering over the cracks - a virtual volcano waiting to erupt.

A lot of distressed mortgage holders engaged with their lenders & entered MARP. Some were offered interest only, some loan restructure, reduced capital & full interest etc etc. The problem is that a lot of these arrangements are now due to expire, resulting in people facing much higher repayments than the original ones that they could no longer afford for one reason or another. Even if they have got back on their feet in the form of employment they will not be able to afford to meet the new hugely increased repayments when the time comes. Something needs to be done about this - as it was never a realistic solution in the longer term, merely a quick fix to keep voters ''happy''.

This thread is a facinating read, especially as regards:

- Opinions regarding the use of the word 'rights' or 'entitlement' :

One of the most fundamental rights contained in our Constitution is our familial rights. Luckily we have Constitutional rights which have to be adhered to when our government introduce any changes that may affect these rights. People should bear this in mind whether they agree with our Constitution or not.

- Opinions regarding distressed mortgage holders e.g. ''Why should I pay for my neighbours mortgage?'' :

Following on from protection of the family unit & all that that entails & social justice in the form of Dept of Social Protection payments, people should bear in mind that as things stand there is no state help or protection for a mortgage holder in the event of illness or job loss. The Mortgage Interest Supplement isn't (& hasn't been since Jan 2014) open to new applicants.

So if the question of ''Why should I pay for my neighbours mortgage?'' (which was never the case to begin with as it was only a portion of the interest content of the loan that was paid) is the argument put forward by renters who ''didn't foolishly gamble'' surely the question that mortgage holders can ask is ''Why should I pay for my neighbours rent?''. The cushion of rent supplement & family income supplement has always & still is there for them. People who are renting are the only category of people who are afforded the luxury of being protected by the state in the form of rent supplement as regards being able to remain in the family home.

It's such a slippery slope to start going down in order to put any vewpoint across in an effort to justify that viewpoint imo. If that argument is to be used surely people without children should be asking ''Why am I paying for my neighbour's children in the form of child benefit?'', ''Why I am paying for my neighbours children's education?''

Surely everyone that works should be asking ''Why am I paying for my unemployed neighbour to put food on the table?'' Surely we should throw them out on the street & let them scavenge for food & shelter - they'll eventually die & that way there'll be more air for the rest of us to breath.

''Why should I pay for the 'oul one down the road to get a hip replacement?'' ''Why should I pay for an ambulance to go to the scene of an accident that I wasn't involved in?''. ''Why should I pay for my neighbour who lost his job to eat? He lost his job & can't get another. He has no third level qualification as he went straight to work when he left school thirty years ago. I have a degree so I'm ok. I'll ignore the fact that that same neighbour paid for my university education in the form of taxes when I was enjoying the student life & afterwards reaped the rewards of a well paid job'' The list of questions is endless.....if that's the road we want to go down....

The answer to all these questions are quite simple. Firstly, we're not paying for it - we're merely contributing towards every sort of state aid that every single citizen in the state benefits from at some stage of their lives, including ourselves. Secondly, we can't cherry pick just because the situation doesn't apply to us at this exact moment in time. If we want to be selective or to cherry pick we should move to a country that satisfies our needs in that regard, contribute to that society in the form of taxes & see how we get on.

I'm neither for or against these latest proposals, mainly because that's all they are: proposals with no firm operational details, eligilility requirements or control measures - pie in the sky so far, just like so many other proposals that never reach fruition or the light of day, so I'll reserve judgement until such a time that more solid information is made available.

One thing is for sure - now that the cracks are resurfacing it's time to come up with some sort of solution - a number of solutions as there is no 'one size fits all'. I can't think of any solutions worth mentioning. The good news is that at least our public representatives seem to be trying to come up with proposals, as outlandish as some of them are so far. Luckily for the public there is an election looming - otherwise they wouldn't bother even doing that much imo. Bring it on!

_Kaiser_

NewDirection wrote: »

I'd like to see some details on what is proposed, there are zero details in the article.

It's a pity this topic descends into people who bought in the boom vs those who didn't. Plus the comment that this is transferring money from the taxpayer to the banks is inaccurate until we see details.

I think if it was set up right it could be a good thing, but it would be very situation dependent. Some debts are just too big and default is the only option.

Take an example of someone who lost their job and now cant afford their mortgage.
Option 1 would be, bank repossesses house. Joe Bloggs now out on the street, and is now eligible for rent supplement.
Option 2 would be , restructure for interest only mortgage, Joe Bloggs now gets some sort of new mortgage supplement.

Both scenarios have home receiving money off the state, the only difference is that he's still in his family home. He's effectively renting off the bank instead of a landlord.

I know its a simplistic way of looking at it, but I think if done right it can be a good thing for a small section of society, without too much extra cost to the taxpayer when you take thebig picture into account.

Just a few counterpoints...

- This whole idea that people who lose "their" house (noting that it's not actually theirs at all until the final payment is made) will be "out on the street" is emotive hyperbole - there's a whole lot of rental properties out there beyond the city limits. Sure, they may have to move and it may not be ideal but private tenants have been doing it for decades.

- This debt is between the mortgage holder and their lender, NOT them and the taxpayer. I have every sympathy for genuine people who are struggling, BUT it's not my responsibility to sort out their mess for them. I have my own debts and taxes to pay... any volunteers to pay my personal loan when I find it tough some months? If not, why not? It's the same thing after all.

- The banks already got a massive taxpayer-fuelled injection a few years ago, supposedly to keep them afloat and deal with this issue. We all complained about how wrong it was then, but suddenly now bailing out private debt with taxpayer funds is ok? All because of a "family home" that (at this point) is no more theirs than the idea that a tenant's rental accommodation is theirs (despite the best efforts of that couple in Castleknock a while back)

- No-one NEEDS to own property. No-one FORCED anyone to sign up for a mortgage. No-one has an automatic ENTITLEMENT to own property. It's a choice and one people are free to make if they think they can sustainably afford it. But if it all goes pear-shaped well that's regrettable, but it's their mess to clean up and they should deal with it as RESPONSIBLE (although maybe that word should be added to the swear filter at this stage!) adults rather expecting "someone else" to do it for them.

Cushie Butterfield

Cushie Butterfield wrote: »

The good news is that at least our public representatives seem to be trying to come up with proposals, as outlandish as some of them are so far.

No. These shenanigans are designed to avoid the hard decisions that need to be taken. Spineless politicians, in trying to avoid this, and to be 'nice' to every section of the population that screams always turn towards a solution that appears painless but which usually involves increasing the burden on the paying section of the population.

If we have learned anything from the past financial crises, and from watching the situation in Greece, it should be avoiding the tough but correct financial decisisions only stores up trouble for the future, for the economy and for our children.

Uncle Ben

_Kaiser_ wrote: »

Just a few counterpoints...

- This whole idea that people who lose "their" house (noting that it's not actually theirs at all until the final payment is made) will be "out on the street" is emotive hyperbole - there's a whole lot of rental properties out there beyond the city limits. Sure, they may have to move and it may not be ideal but private tenants have been doing it for decades.

- This debt is between the mortgage holder and their lender, NOT them and the taxpayer. I have every sympathy for genuine people who are struggling, BUT it's not my responsibility to sort out their mess for them. I have my own debts and taxes to pay... any volunteers to pay my personal loan when I find it tough some months? If not, why not? It's the same thing after all.

- The banks already got a massive taxpayer-fuelled injection a few years ago, supposedly to keep them afloat and deal with this issue. We all complained about how wrong it was then, but suddenly now bailing out private debt with taxpayer funds is ok? All because of a "family home" that (at this point) is no more theirs than the idea that a tenant's rental accommodation is theirs (despite the best efforts of that couple in Castleknock a while back)

- No-one NEEDS to own property. No-one FORCED anyone to sign up for a mortgage. It's a choice and one people are free to make if they think they can sustainably afford it. But if it all goes pear-shaped well that's regrettable, but it's their mess to clean up and they should deal with it as RESPONSIBLE (although maybe that word should be added to the swear filter at this stage!) adults rather expecting "someone else" to do it for them.

Your point is grand except for the possibility that up to 100000 k people COULD be homeless or at minimum COULD be going on already over crowded housing lists. That's the reason it's suddenly become a social issue. By the way it was the Central Bank that forecast those figures. If it was only 1 or 2000 no one would give a Fxxk.

professore

NewDirection wrote: »

I'd like to see some details on what is proposed, there are zero details in the article.

It's a pity this topic descends into people who bought in the boom vs those who didn't. Plus the comment that this is transferring money from the taxpayer to the banks is inaccurate until we see details.

I think if it was set up right it could be a good thing, but it would be very situation dependent. Some debts are just too big and default is the only option.

Take an example of someone who lost their job and now cant afford their mortgage.
Option 1 would be, bank repossesses house. Joe Bloggs now out on the street, and is now eligible for rent supplement.
Option 2 would be , restructure for interest only mortgage, Joe Bloggs now gets some sort of new mortgage supplement.

Both scenarios have home receiving money off the state, the only difference is that he's still in his family home. He's effectively renting off the bank instead of a landlord.

I know its a simplistic way of looking at it, but I think if done right it can be a good thing for a small section of society, without too much extra cost to the taxpayer when you take thebig picture into account.

You're right about bankruptcy - bankruptcy is the best option, be debt free after 3 years and the back takes a hit for poor lending - it has ample taxpayer provided money for this.

_Kaiser_

Uncle Ben wrote: »

Your point is grand except for the possibility that up to 100000 k people COULD be homeless or at minimum COULD be going on already over crowded housing lists. That's the reason it's suddenly become a social issue.

No, it's a financial/debt issue regarding payment for bricks and motor - emotive terminology has nothing to do with it.

And think about what you're suggesting...

- 100k evictions = 100k new properties onto the market
- Those properties can then be bought by people currently renting (freeing up that house/apartment) or by investors who will rent them out to potentially the same people

These houses/apartments won't disappear into thin air!

Turkish1

Uncle Ben wrote: »

Your point is grand except for the possibility that up to 100000 k people COULD be homeless or at minimum COULD be going on already over crowded housing lists. That's the reason it's suddenly become a social issue. By the way it was the Central Bank that forecast those figures. If it was only 1 or 2000 no one would give a Fxxk.

Was hoping you would oblige and answer a few questions -

Any link to this 100k people to be made homeless?

How idea many of this 100k are actually genuine and how many are strategic defaulters?

Any estimate/opinion on to how many additional mortgages will suddenly appear to be in trouble if this proposal passes?

How do you feel about the current SVR rates that banks are charging?

Any reason why every person who would have the asset repossessed would have to go on the housing list?

There simply HAS to be consequences to not paying back a loan that is secured on an asset - regardless of how tough the decisions that have to be made. Each case needs to be taken on an individual basis but the vast majority of mortgages in arrears over 6 months will have no other option but to have the asset repossessed. In some cases it might make sense for other options to be explored.

If there are no consequences why would ANYONE bother paying back any loan? Banks won't be able/want to loan in a non-recourse property market.

Why as Irish do we believe we have to do something special and different to the tired and tested methods of resolving these arrears issues which have worked in economies for decades/centuries.

You will find a lot of people believe that there should be some forgiveness on outstanding balances after the asset has been lost. I personally think there should - but not totally written off, perhaps some token amount paid off as a personal loan over 5/10 years. Alternatively the person can declare bankruptcy and be out in 3 years (potentially changing to 1 year).

Turkish1

Turkish1 wrote: »

Was hoping you would oblige and answer a few questions -

Any link to this 100k people to be made homeless?

How idea many of this 100k are actually genuine and how many are strategic defaulters?

Any estimate/opinion on to how many additional mortgages will suddenly appear to be in trouble if this proposal passes?

How do you feel about the current SVR rates that banks are charging?

Any reason why every person who would have the asset repossessed would have to go on the housing list?

There simply HAS to be consequences to not paying back a loan that is secured on an asset - regardless of how tough the decisions that have to be made. Each case needs to be taken on an individual basis but the vast majority of mortgages in arrears over 6 months will have no other option but to have the asset repossessed. In some cases it might make sense for other options to be explored.

If there are no consequences why would ANYONE bother paying back any loan? Banks won't be able/want to loan in a non-recourse property market.

Why as Irish do we believe we have to do something special and different to the tired and tested methods of resolving these arrears issues which have worked in economies for decades/centuries.

You will find a lot of people believe that there should be some forgiveness on outstanding balances after the asset has been lost. I personally think there should - but not totally written off, perhaps some token amount paid off as a personal loan over 5/10 years. Alternatively the person can declare bankruptcy and be out in 3 years (potentially changing to 1 year).

Its vodoo figures. In any event, can you imagine the effect of 100,000 houses being put up for sale on Allsop. The crash this would produce would mean that each of these 100000 would be able to afford a new mortgage at the then market price.

The problem in Ireland is that government policy has been that people keep their savings and wealth in property - and the taxation system ensures this. Other countries try to encourage saving in more liquid forms (shares etc) and keep the price of housing low and affordable.

gnf_ireland

I am clearly not the only person who has issues with this proposal. I can see to a degree where the government are coming from in terms of rent supplement versus mortgage supplement, but for this to work the following needs to be done

1. Cap on the size of the house in question (both in terms of value, mortgage & square meter-age). Why should someone stay in a mansion if they cannot afford it
2. Limit the duration mortgage supplement is available, say 5 years. After 5 years, if the person still cannot afford the property, another solution needs to be found
3. The payment of mortgage supplement can only extend to the 'interest' element of the repayment, and the customer has to pay a level of interest themselves - Lets say a nice tracker rate of 1% above ECB.
4. Mortgage Supplement has to be capped at the same rates as Rent Supplement
5. The mortgage holder has to show they have engaged the banks to try and resolve the issue themselves, including a period on interest only
6. Mortgage holder has to submit full details of income/expenditure and assets to be assessed for the mortgage supplement
7. Personally, I would also put a cap on how quickly after the mortgage was taken out can this be drawn down - say not for the first 5 years of the mortgage
8. Applies to Principal Private Residences only - cannot apply to investment properties
9. The most important one in my view - mortgage supplement if extended beyond two years (safety net for exceptional circumstances) needs to apply a charge against the property that has to be cleared before it can be transferred or sold. This is the piece that needs to be there to ensure that people are not taking advantage of the system. This can be an implicit charge similar to the local property tax, so does not need to be listed on the title deeds, but can be checked on by solicitors at time of conveyancing. It should also be deemed a liability for an individuals estate in the event of death.
10. If any details supplied in the process are determined to be false (eg non-declaration of assets, not declaring income etc), then the mortgage supplement is withdrawn immediately and the house is repossessed via a fast track process. The mortgage supplement is then a debt to the state, similar to income tax. There has to be serious penalties for those who are not truthful in the process.


The biggest issue most people see with this is the potential for abuse. I have no issue with people genuinely in trouble getting a level of support from the government, but Ireland needs to ease off on the entitlement culture. The property charge has to exist people who do pay their mortgages dont feel like they are being scwr*wed every which way - plus it is only practical.

on_my_oe

Uncle Ben wrote: »

Your point is grand except for the possibility that up to 100000 k people COULD be homeless or at minimum COULD be going on already over crowded housing lists. That's the reason it's suddenly become a social issue. By the way it was the Central Bank that forecast those figures. If it was only 1 or 2000 no one would give a Fxxk.

This point keeps going around in circles

When the distressed mortgage holder vacates the property, let's called it Property A, the property will be sold to one of four options;
1) existing home owner upsizing
2) existing home owner downsizing
3) renter becoming homeowner
4) investor using the property as rental property

The property does not magically disappear off the face of the earth having been abducted by aliens. It does not reinvent itself and move to London to find fame and fortune. The property is still there, it's just filled with different occupants - ones who can afford to live in it.

As a consequence then another property then becomes vacant, let's call it Property B, and again different occupants can move into it, whether it's a property for sale or a property for rent.

It may be a giant game of musical chairs, but that's life. people need to recognise if they can't afford to live there, they need to manage their expectations better. My OH would like to own a brand new Porsche but he has to 'make do' with a 2004 Ford. It's still a car that gets him to and from work, and a home whether it's in the leafy suburbs or in Finglas is still a home, regardless of whether you own it or rent it. My OH is realistic about his car choices and those in financial distress need to do the same about their mo ey woes and living arrangements.

And before anyone trots out the 'what about the children' line, kids are resilient. We had to leave our very nice home complete with swimming pool, second living room, individual bedrooms for each child, etc in 1989 post stock market crash. We then had to move to a more working class area and we had to share bedrooms. Our posh friends didn't come visit us anymore. Guess what, we survived and made new friends! (And learnt something about snobbishness and fair weather friends too).

So we return to 'Cut your cloth to your budget', and if your budget can't afford a three bed semi on a unsustainable mortgage but can afford a 2 bed apartment on rental supplement so be it.

Uncle Ben

Turkish1 wrote: »

Was hoping you would oblige and answer a few questions -

Any link to this 100k people to be made homeless?

How idea many of this 100k are actually genuine and how many are strategic defaulters?

Any estimate/opinion on to how many additional mortgages will suddenly appear to be in trouble if this proposal passes?

How do you feel about the current SVR rates that banks are charging?

Any reason why every person who would have the asset repossessed would have to go on the housing list?

There simply HAS to be consequences to not paying back a loan that is secured on an asset - regardless of how tough the decisions that have to be made. Each case needs to be taken on an individual basis but the vast majority of mortgages in arrears over 6 months will have no other option but to have the asset repossessed. In some cases it might make sense for other options to be explored.

If there are no consequences why would ANYONE bother paying back any loan? Banks won't be able/want to loan in a non-recourse property market.

Why as Irish do we believe we have to do something special and different to the tired and tested methods of resolving these arrears issues which have worked in economies for decades/centuries.

You will find a lot of people believe that there should be some forgiveness on outstanding balances after the asset has been lost. I personally think there should - but not totally written off, perhaps some token amount paid off as a personal loan over 5/10 years. Alternatively the person can declare bankruptcy and be out in 3 years (potentially changing to 1 year).

I haven't any links however I'm sure it's on the most recent central bank document considering it was being quoted on newstalk yesterday morning and as for the amount of strategic defaulters how do you expect me to know that figure. Do you. Don't shoot the messenger.

Dwalsh58

The trouble with this thread is the amount of people on about their tax money being wasted bailing out homeowners. Do they not realise that as soon as it deducted from their wages it ceases to be their money and government's have been wasting money since income tax was introduced, ie wars, feeding the poor etc.
They didn't get as upset when the banks and property developers were bailed out or the amount of foreign aid that's dished out. But what really chaps their asses is the terror that sombody they know or a neighbour might get a hand out.
Have any details about this scheme come out?
And do they think that this government is going to pay people's mortgages off, dream on.

_Kaiser_

Dwalsh58 wrote: »

The trouble with this thread is the amount of people on about their tax money being wasted bailing out homeowners. Do they not realise that as soon as it deducted from their wages it ceases to be their money and government's have been wasting money since income tax was introduced, ie wars, feeding the poor etc.

Ah so your argument is essentially many wrongs can make a right?

Personally though I wouldn't consider "feeding the poor" a waste however I'd note that charity begins at home. We have more than enough homeless here on our streets we should be looking after first

They didn't get as upset when the banks and property developers were bailed out or the amount of foreign aid that's dished out.

Yes they did and do

But what really chaps their asses is the terror that sombody they know or a neighbour might get a hand out.

Because the whole premise is flawed. This nonsensical obsession the Irish have with property ownership has already almost ruined the country once and now we're suggesting we "bail out" more private debt again? Why?

As I said above, no-one NEEDS to own a house and there ARE viable alternatives such as renting.. maybe not ideal, maybe a hassle, but nothing that private tenants don't deal with every day.

Are you going to pay my loans/credit cards/overdrafts if I have a bad few months too? What about if I can't make my rent this month? Or would you suggest that's up to me to sort out?

And do they think that this government is going to pay people's mortgages off, dream on.

No, the Government is paying nothing.. they're expecting the taxpayer to foot the bill - again - so they can buy the next election.

Dwalsh58

Dwalsh58 wrote: »

They didn't get as upset when the banks and property developers were bailed out or the amount of foreign aid that's dished out. But what really chaps their asses is the terror that sombody they know or a neighbour might get a hand out.
Have any details about this scheme come out?
And do they think that this government is going to pay people's mortgages off, dream on.

Yeah, nobody complained about the bankers and developers being bailed out. Never.

Back to reality - why should renters paying higher per month for worse accommodation in most cases, pay the mortgage and create serious wealth for property owners? It's sickening how once again young people are thrown under a bus so a politician can grab a few extra votes.

Perhaps it's best to wait for details, but if this turns out to be as stupid as it sounds, a lot of people will be done with any expectations of sensible governance from any party. For good.

Uncle Ben

Just read the initial link again. Interesting that FF are against it. Makes it appear more likely that the Government would introduce it.