# stop blaming mortgage holders



## Ryandd

Hi - Over the past few days Ive heard alot about debt forgivness and helping distressed mortgage holders, I am one of those people struggling with mortgage repayments, this time last year there was two of us working and had borrowed to purchase a house now in worth half of what we paid for it.  We borrowed what was in our means to borrow at the time, and what the banks were advising we could borrow.  We weren't reckless we thought we made a good investment in buying our home as this was the advice we were given, I remember Bertie Ahern at the time dismissing David Mc Williams suggestion that the property market had got out of control, banks were given targets to lend and there were even mortgage products encouraging parents to release equity from their own homes to help out their children.  It was a government campaign to get people to purchase houses as they were gaining from sales of houses and banks were getting richer.  It was alway a win win situation for the previous government as they walked away with lump sums and bankers have not yet been brought to justice. I would also like to stress that 55,000 people are in trouble with their mortgages not because they were reckless, it mainly because of Job loss caused by this economic mess.  Mortgages would not be in this condition if Jobs were saved, thats another rant for another Day!  I get annoyed with bodies that suggest for one minute that people were reckless we invested in property not to make money but to raise our families and provide a safe home, so please try to look at this from that point of view.


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## Dunlin3

I'm afraid they have to share part of the blame. They fuelled the demand, many lied about their income. It was a state sponsored ponsi scheme. Some people recognised it as such, many did not.


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## Bronte

Ryandd said:


> 1. We borrowed what was in our means to borrow at the time,
> 
> 2. and what the banks were advising we could borrow.
> 
> 3. We weren't reckless
> 
> 4. we thought we made a good investment in buying our home as this was the advice we were given,
> 
> 5. I remember Bertie Ahern at the time dismissing David Mc Williams suggestion that the property market had got out of control,
> 
> 6. banks were given targets to lend
> 
> 7.  and there were even mortgage products encouraging parents to release equity from their own homes to help out their children.
> 
> 8. It was a government campaign to get people to purchase houses as they were gaining from sales of houses and banks were getting richer. .


 
I'm assuming that for these 8 reasons your purchased your home. 

1. How much did you borrow and what was your income and what was the purchase price and how much of a deposit did you have?

2. Can you clarify the advice the bank gave you, did they say you can borrow as much as x and did you borrow x or less

3. Cannot tell if you were reckless until you give cold hard figures and location and type  of property

4. Who gave you the advice that this home was a good investment?  What exactly was that advice

5. How did Bertie Ahern affect your decision to purchase a home

6. So?  Banks always have targets to lend?  

7.  What bank product are you referring to?  Did your parents help you in the purchase?

8.  Which government campaign are you referring to?

Do you now have a home in which to raise a family?


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## Greensquare

This isn't about blaming anyone, the mortgage holders, the banks or the politicans.

This is about personal responsibilty. In this country, we need to be over 18 to legally sign a contract to buy a house. At this age we are presumed to be an adult, to be able to weight up our options and make a decision. Sometimes these decisons work out well, sometimes they don't.
As a society, if we walk away from the consequences of our actions, it leads to anarchy.

We can't be selective in choosing when we want to be treated like an adult and be held accountable for our decisions, and when we want to walk away from the consequences of our decisions.

The above might sound heartless to struggling families, but ultimately we all signed these contracts, nobody put a gun to our heads. Its not as if renting a house was made illegal, and we had no option but to buy a house.


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## Locke

Bronte,

in relation to point 7, I am assuming the OP is refering to Life Loan products that have since been discontinued in several (if not all) banks. For over 65's, these products released equity on the value of the house with no repayments until the passing of such applicant.

Found a link here that Brendan posted: http://www.askaboutmoney.com/showthread.php?t=20109


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## BOOM2BUST

I agree with Ryandd, we all new there were risks taking out mortgages but the ordinary joe hadn't a clue that this economic car crash was coming down the tracks. What ever about the banks these people were trained and educated in their field so they should have had some idea. How could the ordinary joe have predicted so many job loses, people who were lucky to keep their jobs see their wages halve, house prices to halve. So we the people bail out the banks and now we expect the banks to cut some sort of a deal with indebted mortgage holders..what a laugh. And this new group of experts set up to advise the government on mortgage relief are made up of civil servants and bankers the same bunch of clowns that got us into this mess. The people who say that the mortgae holders should have known the risks and its their own fault, these people make me want to puke. We know what side these people are on, the side of the fat cat and banker who just want to see ordinary joe of this country suffer....rant over


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## T McGibney

BOOM2BUST said:


> How could the ordinary joe have predicted so many job loses, people who were lucky to keep their jobs see their wages halve, house prices to halve



Anyone who had lived through the 1980s should have had a very good idea that this was a possibility, however remote. It wasn't as if this sort of collapse had never happened before.


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## z107

I'm not a financial whiz or economist.

However, I do remember driving around Tallaght in about 2005 and being shocked at all the new estates that had sprung up. Hundreds and hundreds of apartments. They seemed to have popped out of no-where. I knew they all couldn't be 'worth' €400k, or whatever crazy price they were.

I knew then that these houses were going to drop in cost. What I didn't expect was the scale of the bust. I didn't think for a minute that the banks would all go bust etc...


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## Ryandd

Hi no this wasn't a life product it was a mortgage product called Family First with EBS


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## sustanon

Personally I'm delighted I was egged into buying a house in 2001, I thought it was great that the bank gave 3.5 times my salary, and 1.5 times my wife's. the norm was 3+1, took a 25 year variable rate mortgage, 94% financing and they took the €3000 first time buyers grant into the deposit. Crazy stuff!...... seriously though, even in that scenario, we thought we were pushing our luck. the madness that followed is exactly that, madness....


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## bugler

No one is blaming mortgage holders. But they will have to accept that they enterered into an agreement of their own volition and that comes with responsibilities. 

As an aside, as the income winner of a renting family I find it annoying to hear mortgage holders go on about how they *had* to provide a home for their family, and the only way of doing this was by buying. In this case the OP actually says "provide a safe home". Presumably my rented home isn't safe. We've also had a recent poster on AAM state that if he couldn't buy a home his family would just "drift apart". Home ownership is *not* a human right - shelter is. No one is *entitled* to own a home. If you can secure the deposit and credit, and make the repayments on their legal debts then enjoy home ownership. If you can't, then you'll have to seek alternative arrangements.

Mortgage holders entered into legally binding agreements, and no amount of unfortunate circumstances will change that. Unfortunately, I think there is a trickle down or creep effect that comes from the rotten political class of the country. After all, if politicians, developers and bankers are all on the take why shouldn't we be?


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## Ryandd

Hi Bugler - In some respects your correct on definition of family home but when banks were lending, it was highlighted that renting was paying dead money when you can be working to pay for a property what you could hopefully own one day and provide security for your family - this would have been my wish which was why i expressed family home in this way.


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## Locke

Ryandd, I would be interested to see what your reply is to Bronte's points above.

In relation to your last comment, banks didn't have exclusivity on that comment and in fairness, the Banks have marketing departments so they are going to gloss things up to sell their products. It doesn't mean you have to buy into it.


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## Ryandd

Greensquare
I understand where your coming from and I absolutley take full responsibility for choices I made, but you have to agree no ordinary hard working decent person could have known what was coming and for that reason I feel there where people in higher ranks, economist shouting from the roof tops but all these were rubbished by the government at the time and the country was told that we were in a healthy state and I'm afraid I believed them.  If people knew what was coming there would have been people rushing to sell their houses and not remortgaging but this wasn't the case.  People buying up property because it was deemed to be the wise move. when you see the news and the reports on regulation or lack of, where lending was concerned and the likes of Anglo bank doing deals to make them look healthier than they were  it makes me angry.


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## Mpsox

umop3p!sdn said:


> I'm not a financial whiz or economist.
> 
> However, I do remember driving around Tallaght in about 2005 and being shocked at all the new estates that had sprung up. Hundreds and hundreds of apartments. They seemed to have popped out of no-where. I knew they all couldn't be 'worth' €400k, or whatever crazy price they were.
> 
> I knew then that these houses were going to drop in cost. What I didn't expect was the scale of the bust. I didn't think for a minute that the banks would all go bust etc...


 

My own ephiney was when we were looking to buy a house, went to look at a 5 bedroom in a new estate and realised that not only could we not get a bed into one of the 5 bedrooms (and I don't mean it would be tight, I mean, you actually, physically could not get a bed into this "bedroom", ), if we put a small shed in the back garden, we'd have no room for anything else. For that, they were looking for €500k.

I have sympathy for some people, like the OP, who have had changed circumstances and are struggling as a result. Given that a mortgage is a long term contract, they should be given all the support that is feasible to get them back on track.

However, I have no sympathy for those who got 110% mortgages, who topped up to furnish the house, buy cars, go on holidays, racked up debts on designer shoes, Waterford Crystal door handles or whatever the hell else they wasted money on. Why should my money go to bail those out? They had the fun, now pay for it


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## Ryandd

Locke
Yes banks have marketing departments that all do a great Job and no you don't have to buy into it and its a choice made based on factors like financial stability, current employment, economics, and the fact that house prices where predicted to be on the rise not collapse, at the time I bought in and I choose to buy, I am making the point that mortgage holders are said to have been reckless with borrowing and I feel its unfair to say given the trends and policies government adopted with the area around lending and regulating banks.  Im not attacking any one area just a number of factors have to be considered before making judgment on mortgage holders


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## Ryandd

Bronte
Firstly Im not asking for your opinion weather I was reckless in buying a home or not, the point is I wasn't deemed reckless when signing for my home and more importantly I didn't feel reckless because at the time I was financial able to make that purchase, so knowing point 3 or any other point of your report is of no help to anyone in a dreadful situation we find ourselves in today


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## CrazyOne

This really doesn't need to always turn into a blame game discussion - at the end of it all it doesn't matter whose fault it is - it happened and now we need to try and find a way to solve it.  It also doesn't have to turn into the judgemental game - people are in dire straits - people are lying awake at night worrying themselves sick - my financial situation is pretty bad but thankfully it's not as bad as it could be - I don't know how people with children cope both financially and emotionally.  Where is the compassion and understanding - we are not in arrears because we don't want to pay our bills but because we can't.  In an ideal world we would downsize and pay our bills - can't do that when house is worth 1/3 of what we paid for it and 1/2 of what we owe on the mortgage.  I just wish people could see beyond the facts and figures and statistics.


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## potnoodler

people had the misfortune of coming of age in a certain time frame, they didnt want to rent and raise a family, our rental market isnt that suited for that,
I'd imagine the next generation wont touch property even if they can get the mortgage


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## Ryandd

Crazyone
your right we all just want to earn a wage to pay our bills, mortgage and provide for our children, we are in a desperate situation and there is no solutions and the original point I was making was not to blame the people for taking out mortgages.  There was a programme on prime time where it mentioned that there should be more repossessions on family homes which is mad as families have only got the roof over their heads and there is no such scheme to deal with all the families that would be out on the street, it was a crazy statement to make and will only cause more hurt to people in already awful circumstances.


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## galwayhous

Of course I blame people who took out excessive mortgages when they, in all probability, were not going to be able to repay these in the long term!! 

I got a D in PASS leaving cert maths and even I was able to differentiate between NEED and GREED at the peak.

I lived for over 10 years in a tiny house WAY too small for my needs because I knew that getting a huge mortgage was unsustainable.

If you wanted to provide for your children, why did you sink their education money into an inflated mortgage instead of renting?




Ryandd said:


> Crazyone
> families have only got the roof over their heads and there is no such scheme to deal with all the families that would be out on the street, it was a crazy statement to make and will only cause more hurt to people in already awful circumstances.


Please spare us the emotional blackmail: families would NOT be out on the street - they would be in a lovely rental, of which there are many.


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## hastalavista

galwayhous said:


> ..families would NOT be out on the street - they would be in a lovely rental, of which there are many.



What's your basis for this statement?

On prime time the statement was made that "losing your home was good for" the 20,000 or so mortgage-holders that are hopelessly insolvent.

Who will provide the rental properties for these families under your model?

Where will the rent come from?
Who will maintain the properties?


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## bugler

hastalavista said:


> What's your basis for this statement?
> 
> On prime time the statement was made that "losing your home was good for" the 20,000 or so mortgage-holders that are hopelessly insolvent.
> 
> Who will provide the rental properties for these families under your model?
> 
> Where will the rent come from?
> Who will maintain the properties?



Where do we think these families would be living if they had not taken mortgages in the first place?


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## orka

People should be able to rent a home similar to their current one for less than their current mortgage repayments - which puts them in a better day-to-day position than they were before.  For example, someone with a 400K mortgage on a property now worth 200K will move from paying the mortgage on 400K to paying rent on a 200K property.  If they can't afford the rent on a 200K property, then there's no way they could have paid the 400K mortgage.  And if they can't afford the 200K rent, their finances are probably such that they would qualify for rent allowance etc.


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## lulubenny

We are one of those families who are in financial trouble.  And believe me we did not borrow more than we could afford.  We built our house back in 2000 when both of us were working in good solid permanent jobs.  Roll on 10 years, I have lost my job and my DH wages have gone down to below what he was taking home back 10 years ago (oh and btw he is a public servant) and I get a whopping €13 a week on Jobseekers!!! We also now have 4 kids to support.  
Please don't anyone have a cheek to tell me we deserve what we get for being greedy. When we got our mortgage, we did the sensible thing and only borrowed what we could afford. We live in a rural area and at the time we built our house renting wasn't an option - we purchased a site and built a modest 3 bedroom family home.  A few years later we added a garage.  Thats it - nothing more, nothing less.
We never had the luxury of going on holidays or driving new cars so please do not tar all mortgage holders with the one brush.  Yes there have been many who did borrow recklessly but many more just borrowed what they needed, and then circumstances changed.  
I am not looking for sympathy or pity just a little bit of understanding.


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## hastalavista

bugler said:


> Where do we think these families would be living if they had not taken mortgages in the first place?



If statements focussed on the past wont help the 20,000.

orka: the rental property will probably cost 200k or so and who will buy the house from which they have been evicted.

The rent allowance comes from the tax payer, as does the  write-down on the house.

The more pressure that comes on the income payout side of the Gov finances the more taxes will need to go up.

Writing off capital values on the balance sheet of the taxpayers owned banks will not have the same effect.


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## 44brendan

lulubenny said:


> Please don't anyone have a cheek to tell me we deserve what we get for being greedy. When we got our mortgage, we did the sensible thing and only borrowed what we could afford. We live in a rural area and at the time we built our house renting wasn't an option - we purchased a site and built a modest 3 bedroom family home. A few years later we added a garage. Thats it - nothing more, nothing less.
> We never had the luxury of going on holidays or driving new cars so please do not tar all mortgage holders with the one brush. Yes there have been many who did borrow recklessly but many more just borrowed what they needed, and then circumstances changed.
> I am not looking for sympathy or pity just a little bit of understanding.


 
Unfortunately we currently tend to have either a "black" or "white" approach to this issue. I.e. That all of those who purchased property in the boom years were greedy and borrowed beyon their means and as a result should now suffer the consequences of such actions. The corollary of this is that all those who purchased property in that period were seduced into borrowing beyond their means by greedy bankers and developers and cannot be held accountable for such actions.
The truth as in most generalisations lies somewhere in between. There are a large number of people such as the above Poster who borrowed within their means at the time but have suffered a loss of employment or income reduction due to economic circumstances. Equally there have been a number of those who initially borrowed above their means and subsidised a high lifestyle through further loans based on Equity Releases as the associated houses increased in value. Every case is different and this is why there can be no standard solution to these problems. There is no benefit to either the Banks or the borrowers in re-posessing property unless all other options have first been explored and co-operation has totally broken down. Does that mean that a developer or other "high roller" who lives in a high spec property should be treated the same as an ordinary punter living in a 3 bedroom semi? Possibly not, but where do you draw the line? These are not easy decision but will need to be made in what is percieved to be a fair and equitable manner. MARP is an attempt to do that but is not itself a final solution. We need a focussed long term solution that addresses all of the issues and gives some level of comfort to those who cannot deal with the burden of debt that they are currently carrying.


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## johnnygman

This site is full of people who love pointing the finger and tuting down the unfortunate people like yourself Ryandd.
Most of the people doing just that most likely made money from property or other related services and through nothing other than timing or stage of life avoided the carnage that our young people and young familes now find themselves in.

Don't expect anything other than you were greedy and you deserve it type response as time and again that is what comes up here. Many people on here want to know whats in it for them to help the most unfortunate of this mess and nothing more so I would not not expect any sympathy from people who in general think they are above you and as many of them say, "I knew it would happen"

I was fortunate in that I did not get caught like youself but I feel your pain and hope that the goverment will do something to help people and families like yourself.

Do not rely on that "expert group" on mortgage arrears though, you only need to see the stuff that was coming out of the half of them before all this happened to see actually how "expert" they are!
It's a difficult problem but i hope that solutions can be found for the benefit of the whole of society.


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## Bronte

johnnygman said:


> This site is full of people who love pointing the finger and tuting down the unfortunate people like yourself Ryandd.
> .


 

Ryandd did not give any real facts for you to make the assumption that he is in an unfortunate position. It is my experience of AAM that those who come on here in real financial difficulty and distress get good advice on here.


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## liaconn

lulubenny said:


> We are one of those families who are in financial trouble. And believe me we did not borrow more than we could afford. We built our house back in 2000 when both of us were working in good solid permanent jobs. Roll on 10 years, I have lost my job and my DH wages have gone down to below what he was taking home back 10 years ago (oh and btw he is a public servant) and I get a whopping €13 a week on Jobseekers!!! We also now have 4 kids to support.
> Please don't anyone have a cheek to tell me we deserve what we get for being greedy. When we got our mortgage, we did the sensible thing and only borrowed what we could afford. We live in a rural area and at the time we built our house renting wasn't an option - we purchased a site and built a modest 3 bedroom family home. A few years later we added a garage. Thats it - nothing more, nothing less.
> We never had the luxury of going on holidays or driving new cars so please do not tar all mortgage holders with the one brush. Yes there have been many who did borrow recklessly but many more just borrowed what they needed, and then circumstances changed.
> I am not looking for sympathy or pity just a little bit of understanding.


 
Well said. A lot of people who are now suffering just bought the most affordable house or apartment they could get, many of them were in public service employment where it was absolutely unprecedented for salaries to be revised downwards. Even the banks assumed they would always be on their existing salary scale when calculating how much they could afford to borrow. I bought an apartment in a very ordinary part of Dublin, nothing fancy or 'beyond my needs', based on a salary scale that was 'set in stone'. I have now had four pay cuts and am in negative equity. I waited as long as I could before buying but you cannot wait forever or you will then be considered 'too old' for a mortgage. As for asking why people didn't just continue to rent, I would not fancy being old and renting in this country. The whole rental market is very very poorly regulated and renters have very few rights. The whole attitude towards renting in Ireland -particularly during the boom years - is that it is a temporary situation, mainly for the young, and anyone still renting after about 35 is a 'loser', and so very little is done to make it a viable alternative to owning your propery.
Even before my salary was slashed I did not have fancy holidays or new cars or expensive furniture or 'go mad' in any way. I am fed up of some people smugly coming on here and telling people it's all their own fault, they just shouldn't have bought a house when they did. We are not all economists, and even the economists didn't all see this coming. We were fed a huge amount of mis-information by the Government, the banks and many so called 'experts'. So maybe a little bit of sympathy instead of preening lectures.


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## Bronte

Liaconn I don't see preening lectures on here.  But are we not allowed to question what happened without anyone in negative equity seeing it as a personal attack on them.  

Take the example on Primetime last week.  Which was a showcase of how awful things are for those in negative equity/debt etc.

We were given scant details but the lady in question had split up from her partner and the bank took the property and this was an example of something bad.  Well her being split from the ex is sad, but nobody's fault only the couples.  Losing the property, was that actually bad or good?  Her debt has been written off and she can start again.  I'd say that there are an awful lot of people who would be delighted to be in her situation and not tied to paying a mountain of debt for the next 35 years.


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## Kerrigan

I agree with your post Johnnygman.


  We’d be looking into a catastrophe if they started taking people out of their homes.  It would cost the tax payer millions upon million in re-housing.

  I have no interest in kicking my fellow Irish man when he is down; but there is a consensus out there, that he should be bare foot on the side of the road with his belongings in hand.

  Investment properties and the likes should be talking from them but they should not be removed from the home were they live.  It wouldn't rectify the problem.


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## liaconn

Bronte said:


> Liaconn I don't see preening lectures on here. But are we not allowed to question what happened without anyone in negative equity seeing it as a personal attack on them. .


 
There's a difference between questioning what happened and some of the indignant 'It's their own fault. Tough luck' type of posts that I have read on this and similar threads. Of course some people lost the run of themselves and borrowed stupid amounts of money for fancy properties they knew in their heart and soul they couldn't afford and didn't need. But not everyone is in that situation and that needs to be acknowledged.


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## ontour

Stop making generalisations
  Stop blaming
  Stop complaining
  Stop waiting for the silver bullet

  Look to the future

  Start helping family and friends if you have the means.
  Start contributing to your community if you have time either by choice, retirement or job loss. Share your skills – develop new ones.
  Start looking for job creation opportunities either for yourself or others.
  Start making decisions based on critical thinking, not based on what the neighbours are doing or what it says in the newspaper supplement.


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## Greensquare

ontour said:


> Stop making generalizations
> Stop blaming
> Stop complaining
> Stop waiting for the silver bullet
> 
> Look to the future
> 
> Start helping family and friends if you have the means.
> Start contributing to your community if you have time either by choice, retirement or job loss. Share your skills – develop new ones.
> Start looking for job creation opportunities either for yourself or others.
> Start making decisions based on critical think not based on what the neighbours are doing or what it says in the newspaper supplement.


 
Excellent post ontour.

While the human aspect of this has to be looked at, so too, unfortunately, does the financial cost of it. I don't think there's anybody on here "pointing the finger" as one poster put it. 

The point I've made previously is that sometimes we make decisions that don't turn out well. We, as adults, have to as best we can deal with the consequences of our decisions. 
I agree wholeheartedly with ontours attitude, we're in one hell of a mess, and we have to work our way out. Unfortunately, as far as I can see, there is no silver bullet solution. And blaming the banks, Estate Agents, Newspapers, or even ourselves won't change the past. 

For a long as we look back and are intent on finding people to blame, we will not get out of this mess.


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## liaconn

Greensquare said:


> Excellent post ontour.
> 
> While the human aspect of this has to be looked at, so too, unfortunately, does the financial cost of it. I don't think there's anybody on here "pointing the finger" as one poster put it.
> 
> The point I've made previously is that sometimes we make decisions that don't turn out well. We, as adults, have to as best we can deal with the consequences of our decisions.
> I agree wholeheartedly with ontours attitude, we're in one hell of a mess, and we have to work our way out. Unfortunately, as far as I can see, there is no silver bullet solution. And blaming the banks, Estate Agents, Newspapers, or even ourselves won't change the past.
> 
> For a long as we look back and are intent on finding people to blame, we will not get out of this mess.


 
Nice words, but no a lot of use to people who can't pay their mortgage and can't sell because they're in negative equity and face having their house repossessed because they've lost their job or are having to take a huge pay cut.


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## oldnick

Llaconn's right. And I'm a bit shocked at the rather heartless attitude displayed by some posters on this and on other threads. 

Maybe it's the way they express themselves - appearing crueller than intended. 

Or maybe they are part of that special group who had the foresight to disbelieve all the advice,indeed persuasion of banks, politicians, accountants, newspapers et al.
(Strangely i never found many members of that group a few years who "knew" the market would crash 50% and that there be a deep long lasting recession.)

I remember some years back my youngish staff starting families constantly bombarded with advice with experts - banks, auctioneers, newspapers,policiticians -the very leaders of this nation. It was not  just advice -it was years of persuasion -buy buy buy borrow borrow borrow. Or else you'll be left behind.

That's why we need a bit of a blame game. So that the rich,respected experts who gave wrong advice should share some of the blame -and cost - with those who in good faith heeded their advice.

 If a bank CEO earning over a million a year (and still on a pension of  a third of that) tells young couples that they'd be silly not to buy and here's loads of money - is anyone really saying that the bank should not share the loss? 
Are some posters really saying it was entirely the purchasers fault that they bought?


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## Boyd

I think a bit of it stems from the fact that if houses had continued to go up people would've taken their profit and not said a word (as would I!). Now that the situation has gone the opposite way some people seem to feel well why should we be compasionate?


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## 44brendan

oldnick said:


> If a bank CEO earning over a million a year (and still on a pension of a third of that) tells young couples that they'd be silly not to buy and here's loads of money - is anyone really saying that the bank should not share the loss?
> Are some posters really saying it was entirely the purchasers fault that they bought?


I would have no dispute with anything said in the above post. Yes the Banks did take a reckless attitude to lending money and as is normal in these circumstances have suffered significant losses as a result. Is it right that senior bankers who by the reckless and incompetent actions cost their banks and their country billions should retire on comfortable pensions? No it's not. Is it right that those who followed the advice of the Bankers and borrowed above their means should now have to suffer all of the consequences of the subsequent economic collapse? No it's not. So what can and should be done to rectify this position?
 In reality very little can be done. Our legal system and employment contracts held do not facilitate a personal penalty for those involved in  reckless corporate trading. While those who borrowed based on bad advice should have some recourse in law to those who lent to them recklessly, they haven't. This is part of the price we pay for living in a democratic society. All laws are not based on what is equitable.  As Brendan B outlined in his proposals for dealing with homeowners in difficulty we must approach the proposed solutions in a pragmatic manner and now look for resolution rather than scapegoats.


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## ontour

It appears that anyone who does not want to wallow in pity and head shaking is heartless.  Did  we learn nothing from the tribunals – years passed, millions were spent and there was little or nothing productive achieved.  We are not going to get back banker’s bonus’s, we are not going to put the editor if the Independent property supplement on trial,  shoddy conveyancy solicitors are not going to end up in Mountjoy.  The simple fact is that the efforts spent on solutions to people's problems are far more important than the blame game.

I am tired of platitudes such as Liaconn's that drive the discussion in to a cul de sac.  If the efforts were focused on the resolution of personal bankruptcy in Ireland, then the individuals in the worst financial positions can at least see closure to a very difficult time in their life.

I would love to see the likes of Fingleton pay for the disaster that he contributed to but I would be far happier if their were 50 families who were getting out from under their debts and able to focus on their family.  It may not make the best media headlines but IMHO what drives media content is usually not the most important social or economic issues.


----------



## hastalavista

ontour said:


> ......IMHO what drives media content is usually not the most important social or economic issues.



This is spot on with the addendum that fair and balanced reporting is for 'others'.

Just take the sub-prime debt example used in Slime Time the other night.

Sad? yes.

A typical example of what is happening? No.


----------



## liaconn

ontour said:


> It appears that anyone who does not want to wallow in pity and head shaking is heartless. Did we learn nothing from the tribunals – years passed, millions were spent and there was little or nothing productive achieved. We are not going to get back banker’s bonus’s, we are not going to put the editor if the Independent property supplement on trial, shoddy conveyancy solicitors are not going to end up in Mountjoy. The simple fact is that the efforts spent on solutions to people's problems are far more important than the blame game.
> 
> *I am tired of platitudes such as Liaconn's that drive the discussion in to a cul de sac.* If the efforts were focused on the resolution of personal bankruptcy in Ireland, then the individuals in the worst financial positions can at least see closure to a very difficult time in their life.
> 
> I would love to see the likes of Fingleton pay for the disaster that he contributed to but I would be far happier if their were 50 families who were getting out from under their debts and able to focus on their family. It may not make the best media headlines but IMHO what drives media content is usually not the most important social or economic issues.


 
It is not a platitude. I am trying to point out that a lot of people in difficulties did not bring it on themselves by stupidity or greed and are deserving of a bit of sympathy not 'oh well what did you expect. You should have know the market would crash'. That is not asking people to 'wallow in pity', it's just asking for some degree of understanding and sensitivity towards people who are going through a very bad time. It's not black and white, you know and I don't want to live in a society where people who are in bits about their mortgage and bills are just told 'sorry, nothing we can do. Now jog on' by people who congratulate themselves on being pragmatic and realistic (usually people who were lucky enough to buy at the 'right' time even though, in retrospect, they will decide they made a good, informed decision or definitely wouldn't have bought during the housing boom no matter what their situation).


----------



## Bronte

liaconn said:


> It's not black and white, you know and I don't want to live in a society where people who are in bits about their mortgage and bills are just told 'sorry, nothing we can do.


 

I can feel your pain and that of others.  But there is nothing any of us on here can do for that.  To give financial advice one has to try and be detached.  This site is littered with desperate stories.  Please don't think that we don't have sympathy, but sympathy will not pay the mortgage. 

There is no one on here who does not have family in dire circumstances.  

I nearly vomited with the Prime time pod cast last night on Nama.  Too cross to even discuss today as I'll have to rewatch when I'm calmer.  

Ontour and 44brendan I would agree with everything you both said.  The waste in Ireland, and what could have been done instead, so sad.  What a corrupt country I'm sorry to say.  And what a circus Nama is.  In 10 or 20 years we'll know the pay, the pay offs, the settlements with developers, the people in Nama being those who were involved in the boom etc.  And no doubt the Nama properties being sold back to developers at rock bottom prices.  It's a commin.


----------



## demoivre

oldnick said:


> If a bank CEO earning over a million a year (and still on a pension of  a third of that) tells young couples that they'd be silly not to buy and here's loads of money - is anyone really saying that the bank should not share the loss?



There are loads saying it it. Yet Bankers are the ones who came up with the idea of 100% mortgages, six plus times salary multiples, offering 3 year fixed rate mortgages so that borrowers didn't have to be stress tested in the same way as variable rate mortgages etc. Two parties sign a mortgage agreement so there is at best equal culpability though I personally blame the banks more because of their ludicrous lending practices.


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## bugler

I think everyone would be ok with the *bank *sharing the loss. The taxpayer on the other hand...


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## Ryandd

Just wanted to reply to Galwayous on some unfair comments, I don't know if its the D in pass Maths or the 10years living in a tiny house, Firstly I don't have an excessive mortgage as you put it and nobody who took out a mortgage perdicted the hugh number of job losses with little evidence that this will improve in the medium term.  Rental prices if you remember were sometimes in excess of mortgage repayments and out of control so no it didn't occur to me to rent a house and paying dead money.  And with regard to education funds for my children you have no basis to comment on my situation without knowing the facts.  Im sure your landlord is grateful to you for paying their mortgage.


----------



## Greensquare

bugler said:


> I think everyone would be ok with the *bank *sharing the loss. The taxpayer on the other hand...


 
Yes, but the bank = taxpayer, because the banks are broke. Any losses to be absorbed by the banks are going to be have to be paid for by the taxpayer, through further capitalisation of the banks. 

If the banks make losses, the money to pay for it doesn't magically appear to fix it, it ultimately comes from the tax payer. So if there is any sort of "loss sharing" or "Debt forgiveness" it will be paid for the average Joe on the steet, who is still lucky enough to have a job to be able to pay tax. Becasue it sure as hell won't come out of the bumper pensions paid to Seanie & fingers.


----------



## aidanmac

"_People in Glass Houses shouldn't throw stones_"

"_Let he who is without sin cast the first stone._"

etc., etc..

I know a man who lost everything in the 80's recession. His family and their security was destroyed by banks and currency speculators.  He lost his home to repossession and the bank pursued him for every penny and he also had to service the other debts we all have and the normal cost of living. He ,more or less, ended up paying for a house he no longer owed so the bank could get it's pound of flesh!

It took him 20 years to recover.

With the economy going so well, he up-skilled in 2005 in his 50's and went after a more responsible post in the industry he worked in. 

He got up the ladder in a small company and was earning what for him was reasonably good money (70K) in what appeared to be a safe business.

Having fought so hard to get back to normality he and his wife got a new mortgage of just 200K and bough a SMALL bungalow in the country as their family home. His mortgage was costing the same as his rent had been - a good move all round. 

In 2009 the banks turned off the company's credit, my friend was made redundant. 

His Mortgage Protection Insurance covered his repayments for 1 year then stopped. 

Three months later he was diagnosed with a slow terminal illness and can never work again. (_He wasn't able to afford Critical Illness Insurance when he was working - he wasn't that well paid._) 

He now lives on a Social Welfare Invalidity Pension - lucky he wasn't self employed!

The bank has now taken his home, again because he will never be able to meet the repayments and he's renting again, and all he did was to work hard and try to recover his family's security. 

You don't know what's around the corner for any of us and there are people out there who genuinely should have their debts taken off them because they didn't create the situation they find themselves in today. 

All mortgages should be non-recourse. Borrowers and lenders are *both* taking a risk. A borrower cannot predict the future and cannot protect against every eventuality. We only have one life and it's much more important than banking or money

Only a fool or a banker would argue against that.

aidanmac


----------



## oldnick

I agree with the sentiments -although making all mortgages completely  non-recourse would mean that lenders would probably want such large deposits that buying would be impossible for most people.

As regards the story about the poor chap with a terminal illness whose bank so quickly took the house off him.....


----------



## Bronte

We are never going to have non recourse mortgages in Ireland.  The cost of borrowing would be much higher if they existed.  

Aidanmac your story is a very sad story.  Could you clarify something please.  Why did the man not stay in the house and the state would have paid his mortgage?  Also did he have life insurance, they normally pay out in cases of terminal illness and life insurance would have been a condition of the mortgage?


----------



## ontour

Bronte said:


> We are never going to have non recourse mortgages in Ireland.  The cost of borrowing would be much higher if they existed.



The cost of borrowing would be higher and the deposit requirement would be greater.  That is not the full picture as these would result is a more stable housing market that is less prone to overheating.  For many people the amount borrowed would be less as they would not be bidding against people that have no deposit and no credit history.   Some people who were able to buy property in the last decade would not have been in a position to purchase if the mortgages were non-recourse, in hindsight many realise that that would not have been a bad thing.

Introducing non-recourse loans would be as much about constraining the banks as it is about constraining the prospective borrower.


----------



## Ryandd

Just wanted to know if anyone knows if the terms of your mortgage warn of negative equity like when you take out an investment and they warn that the value of this investment may rise and fall in line with markets or something to that effect, its not that important but just wanted to know.


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## SteveW9

In fairness you should have the cop on to know that you task a risk when you get a mortgage. If youre house went up 100k would you give this back to the taxpayers that you are looking to bail you out??


----------



## oldnick

steve -in reponse to the post prior to yours:-

- use of terms like " should have add the cop-on" ,  "looking to taxpayers to bail you out" are misleading and slightly offensive...

1) Are you saying that people should have known that buying property was such a risky business? That is,  there was no need for the clever banks to issue any sort of warning to inexperienced buyers, as opposed to banks constant persuasion   to buy?  Did more than 1% of the population believe that property would crash  over 50% and that unemployment would reach record highs ? 

2) "bail you out" -I've never clearly understood this term .I think that you used it in the sense  " pay for your debts" or  "give you money ".                                       Why take that extreme tone to people in difficulty? Some help, not "bail-outs" is what most need - help that need not cost "the tax payer" any more than not helping those in mortage trouble.

3) Your point about the "tax -payers" is assumedly because most banks are now owned by the taxpayer. The banks were stupidly guaranteed  by the govnt and because of this crazy guarantee the banks were taken over . Absolute madness.  But no way the fault of the individual person in trouble. If someone is looking for help ,or burden sharing from the bank this should not be denied because the govnt crazily took over the bank.  Should banks deny loans to businesses because they are risking the "tax payers" money ?

Steve -you started your post "in fairness". It was anything else but fair.


----------



## Chris

A question for the OP would be whether you had a rainy day fund that would tie you over if things went bad. Most people I have talked to that are in difficulties with their mortgages had no additional savings from the day they took out their mortgage. In my opinion it is irresponsible to not have a significant rainy day fund, especially when you have a large mortgage. Even when I had a mortgage I had insurance and savings that would cover at least 12 months of no income and basic living expenses. I do not know many people that have the same.



ontour said:


> The cost of borrowing would be higher and the deposit requirement would be greater.  That is not the full picture as these would result is a more stable housing market that is less prone to overheating.  For many people the amount borrowed would be less as they would not be bidding against people that have no deposit and no credit history.   Some people who were able to buy property in the last decade would not have been in a position to purchase if the mortgages were non-recourse, in hindsight many realise that that would not have been a bad thing.
> 
> Introducing non-recourse loans would be as much about constraining the banks as it is about constraining the prospective borrower.



Deposit requirements would not necessarily be higher. Most states in the US have non-recourse mortgages and almost all of them had extremely low deposit requirements and still do. Non-recourse mortgages would fuel speculation, as the downside risk would be almost nonexistent. If prices go below a certain amount you can walk away, that would result in higher house prices not lower.


----------



## oldnick

Chris 

Property prices have crashed in most of the USA -in some states by more than 50% No expert has  reported any sign that property prices will generally increase .

So, it seems that non-recourse mortgages do not result in higher prices.

Also, are you sure USA banks (of which hundreds have closed/merged in recent years) are still asking for low deposits and giving nonrecourse mortgages ?

You are right about the rainy day savings point. Some people were silly. But the rain has been falling on many(often quite sensible and cautious) people for far more than a year now.


----------



## Alwyn

Interesting read.  The article is over a year old.  Has there been any update?


----------



## ontour

Chris said:


> Deposit requirements would not necessarily be higher. Most states in the US have non-recourse mortgages and almost all of them had extremely low deposit requirements and still do. Non-recourse mortgages would fuel speculation, as the downside risk would be almost nonexistent. If prices go below a certain amount you can walk away, that would result in higher house prices not lower.



True, the US are not a great example of how to implement non recourse loans.  It would fuel speculation if the deposit requirement was low and the approval process was very loose.  The banks should be more risk adverse because the loans are non-recourse, it is this more cautious approach by lenders that should quell speculation.  The recent banks action has shown that banks do not act logically which is a bit of a problem.....for all of us !


----------



## Ryandd

Steve 
In fairness if my house went up 100k we wouldn't be talking about bailouts, its clear the reason behind the crash it and it wasn't you or I.


----------



## kaplan

I would suggest posters positing people borrowed recklessly consider the two LRC reports which contain insightful synopsis of why people get into debt traps and what should be done. "A Behavioural Approach to Law and Economics" - Jolls, Sunstein & Thaler is a wordy article also worth reading. Blaming individuals for what is understood to be a rational human phenomena is rather naive.


----------



## Bronte

Ryandd said:


> Steve
> In fairness if my house went up 100k we wouldn't be talking about bailouts, its clear the reason behind the crash it and it wasn't you or I.


 
That wouldn't be at all clear to me. Did you borrow recklessly? Did anyone in Ireland borrow recklessly. Apparently nobody on AAM did.


----------



## Chris

oldnick said:


> Property prices have crashed in most of the USA -in some states by more than 50% No expert has  reported any sign that property prices will generally increase .
> 
> So, it seems that non-recourse mortgages do not result in higher prices.


Non-recourse mortgages have always been in place in the US, they weren't suddenly introduced after the crash in house prices. What I'm saying is that over the 10 years of the real estate bubble in the US there were predominantly non-recourse mortgages in place and this still lead to massive speculation and a huge bubble.



oldnick said:


> Also, are you sure USA banks (of which hundreds have closed/merged in recent years) are still asking for low deposits and giving nonrecourse mortgages ?


Yes, US banks are doing so and with Federal Government backing, encouragement and assurance. All you have to do is get an FHA approved mortgage and you can have as little as 3% down payment. I have seen figures reported that between 30 and 40% of all mortgages being taken out are FHA mortgages, so there is a huge amount of low down payment mortgages still being taken out.



oldnick said:


> You are right about the rainy day savings point. Some people were silly. But the rain has been falling on many(often quite sensible and cautious) people for far more than a year now.


Yes it has been raining for quite a while, but the vast majority of people I have asked about their rainy day funds, or lack thereof, have less than 1 months worth of savings to cover cost of living. I know one other person that has 12 months worth of savings.



ontour said:


> True, the US are not a great example of how to implement non recourse loans.  It would fuel speculation if the deposit requirement was low and the approval process was very loose.  The banks should be more risk adverse because the loans are non-recourse, it is this more cautious approach by lenders that should quell speculation.  The recent banks action has shown that banks do not act logically which is a bit of a problem.....for all of us !


Yes, but the US banks' behaviour was exactly what government wanted them to do. Through Fannie Mae and Freddie Mac the government looked for ever looser lending policies so that poorer people good buy their own home. The lending practices were encouraged by government policy and the implicit and explicit bailout guarantees.



kaplan said:


> Blaming individuals for what is understood to be a rational human phenomena is rather naive.



I don't think that going deeply into debt is a rational human behaviour, it may be a common human behaviour but that doesn't make it rational or desirable. There are many countries where going into debt is not seen as rational. Germany is probably the best example where people do not tend to spend on credit. One quote I read a few years ago summed it up, it went something like "In the US and UK when people want to buy a car they go to the bank and ask for a loan. In Germany when people want to buy a car they go to the bank to get a savings account."


----------



## Ryandd

I really don't believe I borrowed recklessly I got a mortgage like many thousands it was an average mortgage for that time which I was comfortably able to pay back, since being made redundant Ive used savings to continue to pay that mortgage along with all my bills I don't have credit cards or loans to pay so I'm not as bad as some, but never the less I've reached the end of savings and there is no work in sight, and facing the banks to explain myself is a daunting task.


----------



## Firefly

Ryandd said:


> I really don't believe I borrowed recklessly I got a mortgage like many thousands it was an average mortgage for that time which I was comfortably able to pay back, since being made redundant Ive used savings to continue to pay that mortgage along with all my bills I don't have credit cards or loans to pay so I'm not as bad as some, but never the less I've reached the end of savings and there is no work in sight, and facing the banks to explain myself is a daunting task.



I think you should have approached the bank a lot earlier...when you still had addequate savings and tried to reach an accomodation (such as interest-only, sabatical) etc. It's not a dig and please don't take it as such, but for others who are where you were it might be an idea.


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## moycullen14

And do you think the banks would have talked to him? No, their attitude has been and will continue to be 'keep paying until you can't afford to pay' then we'll pass you over to another department to 'deal' with. There is no-one more guilty of kicking the can down the road than the banks.


----------



## Bronte

moycullen14 said:


> And do you think the banks would have talked to him? .


 
My experience is that the banks are engaging and making arrangments for people.  But you cannot bury your head in the sand and not engage.  People have to talk and write to their banks if they want help.


----------



## moycullen14

Ryandd said:


> Bronte
> Firstly Im not asking for your opinion weather I was reckless in buying a home or not, the point is I wasn't deemed reckless when signing for my home and more importantly I didn't feel reckless because at the time I was financial able to make that purchase, so knowing point 3 or any other point of your report is of no help to anyone in a dreadful situation we find ourselves in today



You have my complete sympathy. It is an awful position to be in and, to make it worse, you are being villified for being 'reckless'.

Back in 2005 or so, if you had a joint income of X and were offered a mortgage of 2X , you should have discounted it by 60% because one of you was going to lose their job and the other subject to paycuts/levies, etc. Also, it should have been discounted by a further 60% to reflect a firesale price when the inevitable crash came. Oh, and don't forget to factor in a tripling of mortgage rates (which hasn't happened, thank god). So, to put figures on this:

Salary: €100,000
Mortgage: €200,000
Discounted for future unemployment: €120,000
Discounted for price drop: €48,000
Discounted for 3x increase in interest rates: €16,000

so, if you were being prudent and had 20-20 future vision, you would have discounted anything that was offered and seemed affordable by 92%. You didn't do this? Well, silly you. All the other posters did and that's why they are sitting pretty today. 

The fact is that with 20-20 hindsight NO-ONE but NO-ONE should have bought or built a house under any circumstances since about 2001. 

I am in complete awe of everyone who saw this one coming to the extent that it did. I presume they shorted bank shares, bought Apple and Gold and are multi squillionaires today.


----------



## Bronte

moycullen14 said:


> All the other posters did and that's why they are sitting pretty today.
> 
> .


 
I don't think that's a true statement. I bought since 2001 and am in negative equity which as far as I can tell is only getting worse.  There are many posters on here probably in the same situation, but that doesn't mean that we cannot say that some of the things that went on were not reckless.  

Ryandd is in a bad situation, but unless he is prepared to put up facts and figures it is impossible to make any helpful suggestions. For example if he is a single man, out of work and cannot meet his mortgage repayments and is not entitled to social welfare help on this, then he should default and he probably should not have used his savings to pay the mortgage.


----------



## fababby

But the banks will not talk to people unless they are already in arrears and will then come to an arrangement but will not put something in place that can take affect 6 months down the line when savings exhaust.

A


----------



## Bronte

fababby said:


> But the banks will not talk to people unless they are already in arrears and will then come to an arrangement but will not put something in place that can take affect 6 months down the line when savings exhaust.
> 
> A


 
Then what you do it write to the bank, default one month,  continue then to pay,  hide your savings, I firmly believe people should keep some of their savings for unforseen emergencies, health bills etc.  It is not the case that people should not have one penny extra in their account before the bank will engage and if that is the case, make sure the money is not in that bank.  

Certainly the banks have not made it easy for people to engage.  But it's also true that some are burying their heads in the sand until it is gone past repair.


----------



## Chris

moycullen14 said:


> You have my complete sympathy. It is an awful position to be in and, to make it worse, you are being villified for being 'reckless'.


I think vilified is very much out of proportion. The simple fact is that an awful lot of people made the same mistake. Just because lots of people were doing it does not excuse it, it was still a mistake to buy into the hype and not significantly prepare for the downside risk.



moycullen14 said:


> Back in 2005 or so, if you had a joint income of X and were offered a mortgage of 2X , you should have discounted it by 60% because one of you was going to lose their job and the other subject to paycuts/levies, etc. Also, it should have been discounted by a further 60% to reflect a firesale price when the inevitable crash came. Oh, and don't forget to factor in a tripling of mortgage rates (which hasn't happened, thank god). So, to put figures on this:
> 
> Salary: €100,000
> Mortgage: €200,000
> Discounted for future unemployment: €120,000
> Discounted for price drop: €48,000
> Discounted for 3x increase in interest rates: €16,000


The biggest flaw in your calculation is that people were taking out 6 and 7 times their combined salaries, not 2 times. A €200000 mortgage would be very serviceable on one wage in your example. And I really do not know why you think that 60% is the discount that should be applied, but maybe you can elaborate.


----------



## Firefly

Chris said:


> I think vilified is very much out of proportion. The simple fact is that an awful lot of people made the same mistake. Just because lots of people were doing it does not excuse it,



I agree. Those who bought after 2005 had a growing number of voices (either official ones like D McWilliams or others like here on AAM or on other sites) calling the market a bubble. Perhaps these voices were not in the majority yet, but they were growing and should have been considered in any case. 



Chris said:


> it was still a mistake to buy into the hype and not significantly prepare for the downside risk.


A mortgage is such a huge commitment in my book and I'd go as far as saying that several years' repayments should be in place for a rainy day.


----------



## kaplan

@chris, suggest you read first and then consider rational behaviour. Your combination of hindsight and self-righteousness is quite a heady naive mixture as your understanding of mental accounting, human behaviour and rational actors is manifestly flawed. In time we may become more German than the German's.
@firefly, there is one body of opinion that holds that bank lending drove house prices in the latter stages of the boom - consider the salary multiple effect amplified by 100% mortgages. As far as I recall the voices you write of were muted by an overwhelming feel good factor - recall discussion on house prices was banned here which was a pity as it could have surfaced the key driver of price - bank credit. As I recall prominent posters here were encouraging first timers to maximise borrowings - even suggesting they do so on interest only terms. Our memories are not as good as we hold them out to be and we have a tendency to fill in the gaps with flawed hindsight.


----------



## Ryandd

Just want to say that I applied for interest only to allow my savings stretch further to have more time to find work, this however is proving more difficult, I am in to my 6th month on interest only and will not cover next months Salary, My siutation is I'm married with 3 children with a mortgage of 300k before both of us lost our jobs we had a combined salary of approx 65k I bought in 2007.  I await your analyistic views


----------



## oldnick

+1 kaplan !

Incidentally, Chris, the "official" voice of Mc Williams and a few others like him were advised to commit suicide by the most official voice of all -our beloved leader at the time - for daring to suggest any negativity.


----------



## moycullen14

Chris said:


> I think vilified is very much out of proportion. The simple fact is that an awful lot of people made the same mistake. Just because lots of people were doing it does not excuse it, it was still a mistake to buy into the hype and not significantly prepare for the downside risk.
> 
> 
> The biggest flaw in your calculation is that people were taking out 6 and 7 times their combined salaries, not 2 times. A €200000 mortgage would be very serviceable on one wage in your example. And I really do not know why you think that 60% is the discount that should be applied, but maybe you can elaborate.



My point - probably badly made - was that even if you were cautious and applied sensible multiples back in 2005 (or earlier) you would still have been caught because no-one could have foreseen how bad this was going to get. Applying discounts based on what has happened would have meant that no-one would have bought. In fact taking out any mortgage or debt back then based on the PROBABILITY of reduced income/redundancy was, in hindsight, reckless. I suppose no matter what the OP had done, he was going to be in trouble. I used 60% because I assumed that both were working with salaries of 50K and the sensitivity analysis assumed one was to lose a job (50%) and the other have an effective drop of 10% - probably not enough really. 

What has been the real killer for people is the combination of a drop in prices AND a drop in incomes. Either could have been coped with - it is the combination that has placed so many in a difficult situation. 

I lived through the 80s property crash in the UK and the one thing you learned from that was that it was so much down to luck - wrong place, wrong time. Mind you, back then negative equity of 10K was seen as disastrous!

The OP is in trouble - he needs to be helped. Only the banks or government can help and will end up footing the bill. Because of the bank guarantee, it will all fall on the taxpayer either by welfare payments or bank bailout. It is inevitable. Blaming (villifying) him is pointless. 

Your best bet in 2005 would have been to be made redundant, go on welfare and let the state pick up the tab. That's a horrible message for the people of this country.


----------



## moycullen14

Ryandd said:


> Just want to say that I applied for interest only to allow my savings stretch further to have more time to find work, this however is proving more difficult, I am in to my 6th month on interest only and will not cover next months Salary, My siutation is I'm married with 3 children with a mortgage of 300k before both of us lost our jobs we had a combined salary of approx 65k I bought in 2007.  I await your analyistic views



I don't know what to advise. Have you been to MABS or sought any professional advice?


----------



## ClubMan

Ryandd said:


> Just want to say that I applied for interest only to allow my savings stretch further to have more time to find work, this however is proving more difficult, I am in to my 6th month on interest only and will not cover next months Salary, My siutation is I'm married with 3 children with a mortgage of 300k before both of us lost our jobs we had a combined salary of approx 65k I bought in 2007.  I await your analyistic views


I skimmed the thread but can't see if/where you have posted a more detailed summary of your overall financial situation. If you have can you point to it please? If not then perhaps posting that will garner some useful feedback. Might even need a new thread as this one has arguably gone off into _Letting Off Steam _territory...


----------



## Firefly

kaplan said:


> @firefly, there is one body of opinion that holds that bank lending drove house prices in the latter stages of the boom - consider the salary multiple effect amplified by 100% mortgages.



Hi Kaplan,
There is no doubt that the cheap availability of bank credit was part of the problem, but credit only _facilitates_ borrowing. At the end of the day, the borrower must sign the dotted line...all the available credit in the world can't change this. 



kaplan said:


> As far as I recall the voices you write of were muted by an overwhelming feel good factor - recall discussion on house prices was banned here which was a pity as it could have surfaced the key driver of price - bank credit. As I recall prominent posters here were encouraging first timers to maximise borrowings - even suggesting they do so on interest only terms. Our memories are not as good as we hold them out to be and we have a tendency to fill in the gaps with flawed hindsight.



I agree..most poeple were saying to buy at the time (normal in a bubble to be fair). However, there was a growing number of people saying the very opposite...that we were in a bubble and a crash was imminent. These voices ranged from posters here to dedicated sites like the propertypin, to almost weekly writings by David McWilliams. In addition, key acticles from the Economist were estimating property here was way over-valued. The point I am making is that those who say that everyone was saying to buy are not being honest...there were plenty people at the time saying the opposite. Any anyway...even if everyone was saying to buy, I would still do my own homework on something this big. We were all told how wonderful Eircom was going to be a few years earleir by the same crowd so that should have been a warning in itself.


----------



## Bronte

Ryandd said:


> Just want to say that I applied for interest only to allow my savings stretch further to have more time to find work, this however is proving more difficult, I am in to my 6th month on interest only and will not cover next months Salary, My siutation is I'm married with 3 children with a mortgage of 300k before both of us lost our jobs we had a combined salary of approx 65k I bought in 2007. I await your analyistic views


 
If you are unemployed and have no income, or assets then you are entitled to mortgage interest supplement from social welfare?  In addition from personal knowledge I am aware that the banks are allowing people on social welfare, whose mortgage interest is being paid by the government, to stay on interest only periods over and over.  Or in some cases with small amounts of capital being paid.  

I'm not sure but I don't think social welfare expect you to use all your savings to pay your mortgage before they will help you.  You're generally allowed to have a certain amount of savings that they will discount.  20K I think.


----------



## ClubMan

_Ryandd _- if you previously approached your lender and (presumably under MARP?) got them to put you on interest only to alleviate your financial pressure then I presume that you completed an [broken link removed]? If so you should make sure that this is up to date and if possible post at least a the key indicative summary figures here to help people to offer informed comments and advice. Thanks.


----------



## Chris

kaplan said:


> @chris, suggest you read first and then consider rational behaviour. Your combination of hindsight and self-righteousness is quite a heady naive mixture as your understanding of mental accounting, human behaviour and rational actors is manifestly flawed. In time we may become more German than the German's.


While I haven't read the full article in detail I don't think that the author is equating actual human behaviour with rational human behaviour; I would certainly agree with that. People often behave in very irrational ways especially when bubble manias kick in and everyone tries to follow the crowd. But that does not excuse the bahaviour, when not all humans in all countries behaved that way. 
I am not applying hindsight or self- righteousness to any of this. I also bought a house in 2004, but did so in a very rational way by limiting myself to an 85% mortgage of an amount no more than 3 times our combined earnings. Even if I had not sold the house in 2008 we would have been able to service the mortgage on one income and we had a rainy day fund that would cover at least 12 months should both of us be out of work. This was the rational and correct thing to do, but many people in this country including many people I know did not think the same. I have posted here before about how people I know ridiculed me in 2004 when I told them it was dangerous and irresponsible to not take the same approach as we did.




moycullen14 said:


> My point - probably badly made - was that even if you were cautious and applied sensible multiples back in 2005 (or earlier) you would still have been caught because no-one could have foreseen how bad this was going to get. Applying discounts based on what has happened would have meant that no-one would have bought.


I don't think that the point was necessarily badly made I just think that your calculations were flawed. People were taking out mortgages for up to 7 or 8 times combined income. Friends of mine who bought in the 90s said that at the time the maximum you could take out is 3 times the higher wage plus one time the lower wage. This is the way it has always been in Germany and very similar in Switzerland (two countries that do not suffer from recurring real estate bubbles). But somewhere along the way people and banks decided that higher multiples were perfectly prudent, when even without hindsight they weren't.



moycullen14 said:


> In fact taking out any mortgage or debt back then based on the PROBABILITY of reduced income/redundancy was, in hindsight, reckless.


This is where I disagree. I think that foresight should have told people that if you take out a huge loan for a very long time then you have to make provisions for adverse financial conditions. Way too many people did not look at the possibility of downside risk at all; it wasn't a case that they acknowledged it, but decided it wasn't a high risk, they simply did not take it into the equation at all.



oldnick said:


> Incidentally, Chris, the "official" voice of Mc Williams and a few others like him were advised to commit suicide by the most official voice of all -our beloved leader at the time - for daring to suggest any negativity.


Yes, you are right about the people who tried to warn us being silenced and ridiculed, but that does not excuse the fact that more people did not listen to them.
While Ahern was the most official voice of the country that does not equate to any level of competence in economic matters. Politicians of all kind lie through their teeth to make themselves look good and will only listen to voices that tell them they are on the right track. That is not something that is new to our current times. You cannot trust politicians and you shouldn't believe anything until it has been officially denied.


----------



## SteveW9

oldnick said:


> steve -in reponse to the post prior to yours:-
> 
> - use of terms like " should have add the cop-on" , "looking to taxpayers to bail you out" are misleading and slightly offensive...
> 
> 1) Are you saying that people should have known that buying property was such a risky business? That is, there was no need for the clever banks to issue any sort of warning to inexperienced buyers, as opposed to banks constant persuasion to buy? Did more than 1% of the population believe that property would crash over 50% and that unemployment would reach record highs ?
> 
> 2) "bail you out" -I've never clearly understood this term .I think that you used it in the sense " pay for your debts" or "give you money ". Why take that extreme tone to people in difficulty? Some help, not "bail-outs" is what most need - help that need not cost "the tax payer" any more than not helping those in mortage trouble.
> 
> 3) Your point about the "tax -payers" is assumedly because most banks are now owned by the taxpayer. The banks were stupidly guaranteed by the govnt and because of this crazy guarantee the banks were taken over . Absolute madness. But no way the fault of the individual person in trouble. If someone is looking for help ,or burden sharing from the bank this should not be denied because the govnt crazily took over the bank. Should banks deny loans to businesses because they are risking the "tax payers" money ?
> 
> Steve -you started your post "in fairness". It was anything else but fair.


 
oldnick
1) "Are you saying that people should have known that buying property was such a risky business?" ...errrr YES when the cost of a house is 15 times the average wage then people should really know that its a risk unless they are idiots. All you had to do was read up about every other property bubble in history....they all have a similar outcome. 

2) Explain to me where the money to help people with their mortagegs will come from if it's "help that need not cost "the tax payer"" ??

seem to me Nick like you have a vested interest in this.


----------



## SteveW9

In fact looking at a previous OLDNICK post: I can see that he does indeed have a vested interest. 
He has many properties and is probably exposed to serious negavtive equity see below: 

"If I had a 100k and no debts then I actually would consider buying property.

The following is based on my own personal portfolio...

Reasonable two-bedroomed apts in Dublin city-centre (don't get a onebedroomed) are available for ca. 100k. they rent at ca. 12/13k p.a.

After insurance,maintenance and some fees they get ca. 10k p.a. pre-tax.
this is ten percent - over twice more than the best bank interest.

Now, whether they'll continue to fall in value is another matter. But decent apts in city-centre locations have stablised in sales price in the last several months.

My 4 bedroom house in top condition D.20 is worth ca. 250k -but my rental income, after costs and before tax, is,again, 10k - a return of only 4%.
But one has to consider whether well located 3/4 bed houses will gain value .A speculative matter we can't discuss."


----------



## demoivre

Who is to blame for, the well documented view, that antibiotics are overused  in Ireland ? 

The foolish patient for demanding the antibiotic in the erroneous belief that antibiotics will cure illnesses that they don't  or

The GP for prescribing the antibiotic ?

It seems fairly obvious to me that if the GP doesn't do the prescribing the patient doesn't get the drug ! I assume from some of the arguments on here that it's only the patient in this instance who should be held accountable or am I missing something?


----------



## theGodfather

I took out a mortgage in 2006 and have only discovered that i hadnt beeen getting mortgage interest tax relief at source (TRS),,,i have now claimed for 4 years ( its as far back as I am allowed to go by revenue), do i personally get a refund or does it all go to my lender. anyone enlighten me????????????/


----------



## Chris

demoivre said:


> Who is to blame for, the well documented view, that antibiotics are overused  in Ireland ?
> 
> The foolish patient for demanding the antibiotic in the erroneous belief that antibiotics will cure illnesses that they don't  or
> 
> The GP for prescribing the antibiotic ?
> 
> It seems fairly obvious to me that if the GP doesn't do the prescribing the patient doesn't get the drug ! I assume from some of the arguments on here that it's only the patient in this instance who should be held accountable or am I missing something?



This is a very good analogy, and in my opinion it is both the patient and the GP. Incidentally I believe that a lot of drugs should not be prescription only, but that is a totally different topic.
In terms of lenders and borrowers both sides are also to blame. But this should only result in the imprudent borrower and the imprudent lender losing out, not everyone else too.


----------



## theGodfather

I read on one of these posts that people lied about their means to obtain mortgages,,,
If i lied about my symptoms to my doctor and he prescribed medication that harmed me on the basis of my lies,,,,
What about due diligence......for lenders and doctors??????????


----------



## oldnick

Dear SteveW9  -please try not to jump to wrong conclusions .

Fortunately, i bought my fully-paid up  Irish properties 10-30 years ago. No negative equity and they're all worth more than when i bought them
But ,yes, actually i was an "idiot " (to use your term about those not realising how risky property pruchasing  was) because I didn't sell the lot five years ago.            But that doesn't make those who were far younger and inexperienced than me "idiots".
Strangely enough, Steve , young people desperate to get on the housing ladder and being constantly pushed by experts to buy property  probably didnt read much about  previous property bubbles. The  experts-banks etc- were the ones who should have known.

Also,SteveW9 -please try to read a post before misquoting..
I clearly said "help" does not mean paying people's debts - there are many ways to relieve the problem without handing out cash.

And I never   said "help that need not cost the tax-payer".  It may well cost the tax-payer, but I said it need not cost the taxpayer any more than not helping those in trouble. At last the govnt is neginning to understand that ignoring the problem will have devastating economic and social consequences. (Anyway, please don't put a fullstop half way through a sentence  and then quote it; there is a difference between "She's pretty" and "she's pretty awful !").

Look -these arguments are going round in circle so to sum up our different positions as understood from our posts:-

 You are someone who knew that property could crash 60% , the banks would collapse and unemployment would reach record highs. Those who didnt realise this are idiotic, so if they're in trouble now they dont deserve our help.

I am someone who is much more comfortable than those in trouble  but still worry about the costs/losses/problems going on at present . But I blame those in charge and the financial experts ,not those who are in trouble. I have no "vested interest" in helping them other than it will help this country on the right path - and for that I do have a vested interest.


----------



## Greensquare

Oldnick, you say above that help "may well" cost the taxpayer. I think thats being a little vague. The banks are broke and so any "help" of any kind (debt forgiveness etc.) will have to be financed by those people in this country who are lucky enough to still have a job and are paying tax. Considering the rates of Income tax we already pay, I think that suggestion is very unpalatable to most people. 

Remember, just because people still have a job, doesn't mean that they're not struggling. Raising Income tax further to "help" people who have lost thier jobs and can't pay the mortgage, will put people who have jobs under more financial stress. Thats just moving the problem from one sector of society to another.

Unfortunately there is no magic pot of Gold that the government have in reserve for a rainy day, & the country doesn't have a rich Uncle we can tap for funds. We are pretty much on our own, individually & as a country, with this mess.


----------



## bugler

demoivre said:


> Who is to blame for, the well documented view, that antibiotics are overused  in Ireland ?
> 
> The foolish patient for demanding the antibiotic in the erroneous belief that antibiotics will cure illnesses that they don't  or
> 
> The GP for prescribing the antibiotic ?
> 
> It seems fairly obvious to me that if the GP doesn't do the prescribing the patient doesn't get the drug ! I assume from some of the arguments on here that it's only the patient in this instance who should be held accountable or am I missing something?




I would say what you are missing is that not being a homeowner does not equate with being ill. 

Being without property is not a sign of sickness.

A bank is not a doctor. Buying a property isn't a recognised treatment for any malady that I am aware of. But I haven't been keeping up with the medical journals lately.

Perhaps you could do better, and come up with an analogy that portrays the typical mortgage holder as a starving orphan.


----------



## oldnick

greensquare -
 Yes "may well cost the taxpayers" is a little vague.
 Nobody knows the cost of helping the ones in real trouble, and nobody knows the cost of not helping them. That's why it's "vague". 
Sorry for not being precise as regards the solution to this crisis. When I can do that I'll stand for President.


Anyway,  to repeat what i've twice said before in this thread :-

1) If we (the govnt the taxpayers whatever) don't "help" (i explain the word help in this context below) then the social and economic costs to the country could be very high. The banks don't want to foreclose on thousands of homes, the govnt does not want to house thousands of families. Not helping will be disasterous.

2) But by "help" does not mean handing out cash. As per the committee on which Brendan Burgess was on , as per countless suggestions , as per common sense - there are many ways to help those in trouble without it being a harsh cost on the rest of us...
.. 50 year+ mortgages, interest only mortgages, "breathing space" part-payment of interest,  shared equity deals, and/or a combination of these plus other ideas.....

In fact it may be cheaper for the country to help than do nothing for those in deep trouble.


Anyway,  I -and I really don't think many people on AAM have - asked for simple  "debt-foregiveness" .  Have you now got that ?

Do posters really read what others write?


----------



## Ryandd

I just want to come back in to say that I continued to pay my mortgage when made redundant stupidly thinking I would get a job before it had ran out, I didn't ask for help from the social to pay it as maybe it was pride.  But I don't want to take anyones hard earn cash to help with my problems and I think most people in my situation feel the same so please don't be too harsh because we at one stage were paying tax and understood that it was contributing to society less well off, Im am now that person less well off and I hope the waiting game of banks sabalising doesn't cloud the real issues as I feel they have been put aside.


----------



## UFC

Ryandd said:


> no ordinary hard working decent person could have known what was coming



I am an ordinary, hard working, decent person and I thought it was beyond obvious there was something wrong (back in 2004/2005) when I realised I would not qualify for a mortgage for an ex-council house in a horrible estate in Ballyfermot, even though I am a software engineer earning a good wage.

I guess I am lucky though, because I can smell bull**** a mile away so didn't believe any of the crap from bankers about Ireland being "different" or the price of property only going up.

So I then went and researched property bubbles and within about 5 seconds could see we were in the middle of a huge property bubble.

Honestly, and this will sound harsh, but if you didn't do independent research before making the biggest purchase of your life, you can't really blame anyone else for your problems.


----------



## UFC

I do of course have sympathy for those who have lost their jobs and are struggling, but from what I've read on this forum and others, it seems many people are defining "struggling" as being in negative equity and not being able to trade up to a nicer house in a leafy suburb.


----------



## Bronte

demoivre said:


> It seems fairly obvious to me that if the GP doesn't do the prescribing the patient doesn't get the drug !?


 
There are quite a number of people who demand antibiotics and won't leave the GP be unless they get them.


----------



## Kev

Wish GP would stop prescribing unnecessary expensive inappropriate drugs for people in care homes in order to keep them sitting quietly sitting in chairs all day long as they are always understaffed.  Drugs are mostly paid for by the tax payer or the residents.  

UK has now come to decision now to stop these drugs because they are feeling they are now stop wasting money where it is not necessary.  Instead of these unnecessary drugs dished out in care homes it is strongly recommended to have a good exercise classes every day for their residents/patients. 

  This would be much better for the economy and the people in care homes.  Care homes in Ireland and I have personal experience of them due to a close relative being in one.  The GP and consultants are dishing out these drugs like sweets.  Been in contact with consultant and GP pointing out that these drugs according to manufacture instructions should not be given to patient/residents with dementia to no avail still on them today.   These drugs are not used as a last resort as GP’s says they are widely used in care home UK and Ireland. 

http://www.guardian.co.uk/money/2011/apr/19/care-homes-sub-standard-practices


http://news.bbc.co.uk/1/hi/health/6506327.stm


----------



## bugler

Now *that's* a good analogy!


----------



## mcwhirter

Dunlin3 said:


> I'm afraid they have to share part of the blame. They fuelled the demand, many lied about their income. It was a state sponsored ponsi scheme. Some people recognised it as such, many did not.


 
Oh how I wish I had not moved here from my home country, what a mistake that was.
I didn't lie. I was completely honest, went down the correct path. Lender offered me a mortgage of 450k. I thought how could I pay that?, and took a 330k mortgage, now house is worth about 100k less than mortgage.
It's a family home, I can afford repayments just at the moment, but negative equity is causing a barrier to moving (trading down, not up!)
I can imagine thousands like me out there, honest but being treated like dirt. 
Mortgages at the time were cheaper than renting too, main reason why I bought. Making a quick buck wasn't my main reason to buy, thank you.

The politicians that CAUSED this issue can die a long painful death as far as I am concerned.
They are not exactly helping the situation are they!!


----------



## Bronte

mcwhirter said:


> I can imagine thousands like me out there, honest but being treated like dirt.


 
Who is treating you like dirt?  Presumably you live in a nice home and you can afford the repayments, is not being able to trade down a big deal?


----------



## demoivre

Bronte said:


> There are quite a number of people who demand antibiotics and won't leave the GP be unless they get them.



The GP is more to blame -  patients can shout and roar all they like but if the GPs won't prescribe the drug the patient doesn't get the drug - it is that simple. In the context of some of the mortgages given out by  banks, instead of showing restraint when the prospective borrower shouted and roared for the bigger mortgage the bank gave three year fixed rates to borrowers knowing that the borrower would not past the stress test if they offered a variable rate mortgage !! And what's even more farcical is that it was all done under the watchful eye of the Regulator and the Central Bank . We are, and deserve to be, the laughing stock of Europe.


----------



## Bronte

demoivre said:


> And what's even more farcical is that it was all done under the watchful eye of the Regulator and the Central Bank . .


 
As far as I'm aware the regulator and central bank were not keeping a watchful eye, they were in cahots with the banks and politicians.


----------



## peelaaa

oops wrong thread


----------



## trailblazer

To be fair, I would find it quite hard to blame the average mortgage holder for the state of affairs they are in. I borrowed 60% of what the bank was willing to give and I'm still screwed.

At the time, 04 - 07, people needed places to live. They had jobs and felt secure. Everywhere they turned politicians, banks and developers were telling them to buy. Most were just buying a family starter home or something in that regard. I wouldn't say they were reckless. They were not investing for profit. Hindsight is great for all the detractors, but the time it was a perfectly reasonable move.

Now, if you have no reason to move and can afford your mortgage, then there is no problem of course. Negative equity is of no consequence. However, for those who do need to move and there are many reasons for needing to move to a larger accomodation or a smaller one (separation, new arrivals, emmigration, etc) , these people are stuck. I can understand the "well screw them! I was sensible" attitude but I think, as citizens, they deserve some kind of assistance rather than being completely marginalised. It is a sorry state when we "screw them" and didn't "screw" the bankers, bond holders, developers, politicians, etc.


----------



## SteveW9

UFC said:


> So I then went and researched property bubbles and within about 5 seconds could see we were in the middle of a huge property bubble.
> 
> QUOTE]
> Well done UFC ..I did the exact same and knew it was madness.
> This is what OLDNIC just doesn't appreciate the information was there for all to see.


----------



## TheBeach

trailblazer said:


> To be fair, I would find it quite hard to blame the average mortgage holder for the state of affairs they are in. I borrowed 60% of what the bank was willing to give and I'm still screwed.
> 
> At the time, 04 - 07, people needed places to live. They had jobs and felt secure. Everywhere they turned politicians, banks and developers were telling them to buy. Most were just buying a family starter home or something in that regard. I wouldn't say they were reckless. They were not investing for profit. Hindsight is great for all the detractors, but the time it was a perfectly reasonable move.
> 
> Now, if you have no reason to move and can afford your mortgage, then there is no problem of course. Negative equity is of no consequence. However, *for those who do need to move and there are many reasons for needing to move to a larger accomodation or a smaller one (separation, new arrivals, emmigration, etc) , these people are stuck*. I can understand the "well screw them! I was sensible" attitude but I think, as citizens, they deserve some kind of assistance rather than being completely marginalised. It is a sorry state when we "screw them" and didn't "screw" the bankers, bond holders, developers, politicians, etc.



Well said. I don't think everyone thinks these buyers were irresponsible. I, for one, feel incredibly sorry for anyone in this situation.


----------



## bugler

I personally think it's bizarre that there is an expectation that the taxpayer has a responsibility to help people resolve issues in their personal life. 

Got separated? Let the taxpayer help you out. 
Want to move country? Let the taxpayer help you out. 
Don't want your kids to share a room? Let the taxpayer help you out.

I do support measures to help people who are in hopeless situations, mostly to write off debt while they surrender the property, but if anything this thread shows what a slippery moral slope it is.


----------



## SteveW9

trailblazer said:


> To be fair, I would find it quite hard to blame the average mortgage holder for the state of affairs they are in. I borrowed 60% of what the bank was willing to give and I'm still screwed.
> 
> At the time, 04 - 07, people needed places to live. They had jobs and felt secure. Everywhere they turned politicians, banks and developers were telling them to buy. Most were just buying a family starter home or something in that regard. I wouldn't say they were reckless. They were not investing for profit. Hindsight is great for all the detractors, but the time it was a perfectly reasonable move.
> 
> Now, if you have no reason to move and can afford your mortgage, then there is no problem of course. Negative equity is of no consequence. However, for those who do need to move and there are many reasons for needing to move to a larger accomodation or a smaller one (separation, new arrivals, emmigration, etc) , these people are stuck. I can understand the "well screw them! I was sensible" attitude but I think, as citizens, they deserve some kind of assistance rather than being completely marginalised. It is a sorry state when we "screw them" and didn't "screw" the bankers, bond holders, developers, politicians, etc.


 
thats because we weren't given the option to screw the bankers...believe me the majority wanted too


----------



## oldnick

*The TEAPARTY is alive and well in Ireland !*

Looking at some of the posts in this and other threads it appears that some people believe ( and I use words and quotes from those people)

The Irish Tea Party share some things in common with their USA counterpart:-

1. THEY DISPLAY A HEARTLESS ARROGANCE . (Those in trouble should have read economic history and seen what was coming . I did - so it serves them right they're in trouble)

2. THEY INFER THEY ARE SMARTER AND MORE HARD-WORKING THAN THOSE IN TROUBLE. They constantly irepeat  how they knew what was coming , and how hard-working taxpayers should not  bail others out .As if those in trouble are not hardworking ,or are stupid.Or both.

3. THEY DONT LISTEN OR READ WHAT OTHERS SAY...                                                                           
 There have been many suggestions on how to alleviate the mortage distress situation that do NOT involve the taxpayers paying.  And yet the TeaPartyers keep on harping on about" why should the taxpayers pay?"                                                                                       Look at Buglers last post -WHERE does anyone say in the previous posts that the tax-payer should pay if people want to move because of seperation ,larger families etc? Why make those statements when it is so clear that Lenders flexibility does NOT mean debt foregiveness.

4. THEY DON'T COME UP WITH ANY IDEAS as to how to solve this problem. A problem that,if not solved, could cost great social and economic damage. All we hear is attacks on those in trouble .

5. SOME SEEM ALMOST MALICIOUS.  I'm saddened at how they react. One of them said I must be in negative equity for taking the stand I have -he even quoted another post where I mentioned some of my properties i have. (almost as if to say "look,look, Old Nick has a lot of properties -he must be in trouble")
Evidently he could not believe that a comfortable property owner who did not buy Irish property in the last decade and has paid all loans on irish properties could possibly sympathise and support those seeking help. ("OldNick has his own vested interest").

Well, I've been self-employed all my life. no dole, no sick-pay, or any social welfare. All taxes and debts paid. A middle income shop-keeper who has made and paid for some dumb business/investment plans but never sought a cent from the govnt until my OAP comes along next year (a year later than if I had been a PAYE worker).

Suggesting help for others does not have mean that one has a vested interest in those others. Not only is it morally right -it actually is socially and economically beneficial.


----------



## bugler

trailblazer does not clarify what "assistance" people wanting/needing to move or 'forced' into it should be given, it may be debt-forgiveness or a NE mortgage. I am not against the latter. 

While it may not be a stated intention in this thread (frankly I am not going to read back through it as I don't have the time), the idea that debt forgiveness should be given for a variety of reasons (ranging from it's a "family home", to "we could afford it at the time") is in open discourse in the public realm. Any such effort will be highly prone to abuse or manipulation. 

Lastly, you'd be better served by laying off the hysterics. References to one of the more disturbing political movements of recent times in a different country are not helpful. It's easy to be populist.


----------



## Ryandd

Like mentioned earlier, we weren't given a choice when government gave blanket guarantees across the board, remember who we are bailing out its not just your neighbour who has lost his job due to the downturn, or the business that couldn't access credit from banks and had to close making redundant their staff, the way I can see it is that negative equity is the least of peoples worries, if the government don't address the growing employment issues that are presenting in this country there will be no let up on growing poverty and mortgage default, social welfare bills rising, mental health issues, and the list goes on....


----------



## SteveW9

oldnick said:


> *The TEAPARTY is alive and well in Ireland !*
> 
> Looking at some of the posts in this and other threads it appears that some people believe ( and I use words and quotes from those people)
> 
> The Irish Tea Party share some things in common with their USA counterpart:-
> 
> 1. THEY DISPLAY A HEARTLESS ARROGANCE . (Those in trouble should have read economic history and seen what was coming . I did - so it serves them right they're in trouble)
> 
> 2. THEY INFER THEY ARE SMARTER AND MORE HARD-WORKING THAN THOSE IN TROUBLE. They constantly irepeat how they knew what was coming , and how hard-working taxpayers should not bail others out .As if those in trouble are not hardworking ,or are stupid.Or both.
> 
> 3. THEY DONT LISTEN OR READ WHAT OTHERS SAY...
> There have been many suggestions on how to alleviate the mortage distress situation that do NOT involve the taxpayers paying. And yet the TeaPartyers keep on harping on about" why should the taxpayers pay?" Look at Buglers last post -WHERE does anyone say in the previous posts that the tax-payer should pay if people want to move because of seperation ,larger families etc? Why make those statements when it is so clear that Lenders flexibility does NOT mean debt foregiveness.
> 
> 4. THEY DON'T COME UP WITH ANY IDEAS as to how to solve this problem. A problem that,if not solved, could cost great social and economic damage. All we hear is attacks on those in trouble .
> 
> 5. SOME SEEM ALMOST MALICIOUS. I'm saddened at how they react. One of them said I must be in negative equity for taking the stand I have -he even quoted another post where I mentioned some of my properties i have. (almost as if to say "look,look, Old Nick has a lot of properties -he must be in trouble")
> Evidently he could not believe that a comfortable property owner who did not buy Irish property in the last decade and has paid all loans on irish properties could possibly sympathise and support those seeking help. ("OldNick has his own vested interest").
> 
> Well, I've been self-employed all my life. no dole, no sick-pay, or any social welfare. All taxes and debts paid. A middle income shop-keeper who has made and paid for some dumb business/investment plans but never sought a cent from the govnt until my OAP comes along next year (a year later than if I had been a PAYE worker).
> 
> Suggesting help for others does not have mean that one has a vested interest in those others. Not only is it morally right -it actually is socially and economically beneficial.


 
ah so you are a " A middle income shop-keeper" ...no such thing with the prices that you guys were chaging during the boom.... which also explains the number of properties you were able to get.


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## Heckles

People who did not buy property during the bubble benefited from the low  taxes on their income while paying low taxes on their outgoings.

It seems to me there are a lot of people who seem to have known the  future and press this point like everybody should be an economics  master.

So did you pay more tax than you had to because you knew taxes were too  low ? or did the narrow and low tax base benefit you for the period of  the boom ?

Surely you spread the word that everyone should pay more tax ? 
or having accumalated whatever wealth you may have off the back of this  same system, you have convinced yourself you had no benefit from it.


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## Luternau

SteveW9 said:


> ah so you are a " A middle income shop-keeper" ...no such thing with the prices that you guys were chaging during the boom.... which also explains the number of properties you were able to get.



Thats such a generalised statement. You have no way of knowing how much he   charged, made etc. And remember, he employed people, paid taxes, rates and possibly rent too. One thing is sure, the poster you are negative towards did not cause the mess we are in. So why the harsh words?


----------



## oldnick

Liuternau - you're right in what you say.

 I didn't bother replying to such a ridiculous statement, especially as it's not the first completely false one made about me by SteveW9 ( last time it was the accusation that I must have a vested interest in helping people in negative equity because obviously I'm in negative equity!) -
His last statement was even sillier and very insulting to all self-employed people such as small shop-keepers.
I'm only commenting on it now due to your own accurate post.


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## jetstream

How are the mortgage holders to blame ? The prices increased because the banks where reckless in handing out large sums of money therefore allowing to developers to increase prices on each phase of their developments. People therefore had very little choice but to borrow in fear that they would be unable to afford to buy the house they wanted. Supply and demand, its simple economics.I have to laugh at Dunlin3 and Bronte saying that the ordinary person fuelled this problem. Did we go into developers and say "actually could you add and extra 100k onto the price of that house because i really dont think i'm borrowing enough from the bank". How can you justify a 500k mortgage to a family on 70k ? And dont tell me that everyone lied about their income, why should people lie, banks handed out 100% mortgages. If this is not reckless conduct i really dont know what is.


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## Murfnm

This discussion is becoming rediculous.  There is no one thing to blame, but many. Yes the mortgage holders are to blame, yes the banks are to blame, yes the developers are to blame, but mostly, in my opinion, the government/regulators are to blame.  It is their job to put controls in place so disasters of this nature cannot happen.


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## Ryandd

I appreciate your opinion that all are to blame but I do feel that it is the mortgage holders that are being punished the mosts, bankers are getting their bailout and bonus, developers are getting out through Nama and the regulator has taken no responsability for not doing their job instead they got lump sum payment in golden handshake so this all needs to be considered, there is still no positive solution from government to help stressed mortgage holders in negative equity, people are stuck in houses that cannot sell for a very long time with no ability to pay due to job loss which ultimatley came from the banks misconduct and irresponsability over the years unnoticed by the regulator.  I hope you can see the point Im making, why is it there has been no help apart from humiliation from banks when we approach them because we can no longer afford the repayment and are in arrears.  Some back in the thread mentioned about how people should have seen the property bubble coming as they had, if thats true it should be the same case in the banks crystal ball, instead they up their game and continued to lend not considering the devastasion, but I bet alot of them have now left with their bonus for targets achieved and with no moral obligation to its customers,  If ordinary people should have seen it coming then I would expect that government and banking experts should have taken more heed instead they did the opposite.


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## Luternau

I posted the following in another thread on Mortgage arrears etc, but its just as relevant here;



Luternau said:


> It very easy to be wise after the fact. I would guess the OP did not see armegodon coming? And if the Govt, Mandarins in Dept of Finance & Economists etc did not see it, it's reasonable to assume the OP could not have nor should be expected to see it.
> 
> [snip].
> 
> ...But perhaps it's time that the pain of these crippling mortgages was shared 50/50 with the other party to the transaction, who also took a risk that has not worked out as intended.



This is chicken and egg stuff with differing degrees of involvement and responsibility for all involved in this mess. Blaming Mortgage holders (or lets call them buyers) for taking out large mortgages to buy over priced homes or properties to rent out is too easy. 

Where was the the regulation on the amounts banks were lending to developers and buyers?  Of course, in order to get their money back from the developer, banks had to lend to buyers, so the variables on lending were relaxed and people were able to get massive mortgages, over 40yrs. Sometimes you have to say no, bu the banks kept on cashing in.

All was going just 'Grand' as Bertie would have us believe but for one thing - money became scarce for the banks to get partly due to their own exposure to development and partly due to external factors, way way beyond their control. 

But to go back to my chicken and egg scenario, its not the eggs fault that the chicken laid it. Therefore, why should any of the real blame rest with buyers (mortgage holders)? Like the egg, they were the tail end of a process they had no control of, and very little involvenment in.


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## Ryandd

I agree with you on those issues, but I often heard the general term that people got massive mortgages, but they forget this was the market value, people had incomes that satisfied banks criteria, the mortgages only seem hugh because of the fall in prices but at the time they were in line with economic trends.


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## SteveW9

because shop keepers in particular have and still are rippig us off.......the price of the most basic food items is insane


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## Bronte

jetstream said:


> .I have to laugh at Dunlin3 and Bronte saying that the ordinary person fuelled this problem. Did we go into developers and say "actually could you add and extra 100k onto the price of that house because i really dont think i'm borrowing enough from the bank.


 
Is it not reckless to borrow more than one could ever hope to repay. And actually 'some' buyers went crazy, what about all the stories of people queueing up overnight, trying to outsmart and outbid each other on new housing developments, with not a sod turned of shoeboxes. Everybody was to blame. But I do agree that those left carrying most of the can are mortgage holders. The only way the others (regulators/ bankers/ politicians) can be held to account is if the laws are changed and people stop voting for the same people at every election. And push the politicians to make changes.


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## Luternau

Bronte said:


> Is it not reckless to borrow more than one could ever hope to repay. And actually 'some' buyers went crazy, what about all the stories of people queueing up overnight, trying to outsmart and outbid each other on new housing developments, with not a sod turned of shoeboxes. Everybody was to blame. But I do agree that those left carrying most of the can are mortgage holders. The only way the others (regulators/ bankers/ politicians) can be held to account is if the laws are changed and people stop voting for the same people at every election. And push the politicians to make changes.



Its not everybody that borrowed more than they could afford. Sadly, its true that some did - but there are two sides to the transaction. Its not like they walked in with balaclava, gun and pen and demanded the money and signed mortgage documents. They applied for the money, filled in forms etc. Where was the credit review committee to determine if the earnings, savings history etc., stacked up, or where was the stress testing at say 2% more than current rates to double check affordability? If this was done at branch/HQ level as most buyers thought was happening, would prices have continued to climb-with lot of and lots of people getting turned down for 95% or even 110% mortgages? Its a 50/50 argument/scenario.

Sadly we dont elect bankers or Regulators, so there is no certainty that we will get the calibre of either that us as the taxpayers deserve. Thankfully, we do elect politicians and as per the last election, the people showed just what people can do when their politicians, particularally, their Government politicians, let them down. 

Looking forward, just like the world changed after 9/11, the political landscape has changed here following the disastorous events leading up to that night in Autumn 2008 and its lagacy/aftermath. It will take time for everything to resolve itself, but I cant see us ever going back to the madness of the noughties. That in itself is positive. Time to work and look forward to Ireland being a better place - and mortgage holders have a role to play in this.


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## jetstream

Bronte, people queued for houses because they knew that the next phase would be increased. Yes there probably was the few investors there to make a quick buck but I was one of the people who bought because i KNEW that the price would increase the following week. People didnt take into account they or their partner was going to lose their job or that after Sept 2008 when Lehman Brothers filed for bankruptcy the financial industry as we know it was going to collapse. Governments and so called regulators failed and are still failing and now since the governments (taxpayers) bailed out the banks entire countries and continents are broke. But of course thats the mortgage holders fault because they just wanted to borrow more money for that house they wanted to raise a family. The banks have a duty to accept part of the blame for the situation they have people in. The Fitzpatricks and the Fingletons of society should be put under house arrest or kicked into Mountjoy until the legal investigation is complete instead of the ordinary person taken their place in prison.
Bernard Madoff is a classic example and he didnt even bring down a country.


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## Bronte

jetstream said:


> I was one of the people who bought because i KNEW that the price would increase the following week. .


 
Why was the fact it was going to increase your reason for buying?  Please explain the thinking you had at the time?


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## jetstream

No i bought because that was where I wanted to live !! The phase before that was cheaper so no real thinking required there really unless you had your head in the sand during the boom years. I can afford my mortgage my point is that there are people on this forum who cannot afford to pay their mortgage and they are looking for support, assistance and advise, they dont need to be told what they did caused the problem so deal with it. I know people and they can hardly even afford food for themselves or family due to their mortgage. The banks/government/regulator FAILED to do their jobs. I agree, times where good and people didnt see this economic tsunami coming so they borrowed more that they should have, but why did the banks allow this and why was the regulator not doing his job and REGULATING ????


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## Bronte

You've contradicted yourself.  Did you buy because it was your forever home or because you knew the price would increase?


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## JoeB

Yes, the Regulator should be in prison,.. if he hasn't broken any laws then the government of the day should be exposed as being babbling incompetents for having not made falling asleep at his post a crime. 

I fully believe that it was the Regulator first and foremost who could have prevented these problems we now face.. and the government is responsible for not taking action when it was clear that the regulator was failing, and that we were clearly in a property boom. Instead, we had our foremost politicion rubbishing any sugestion of a downturn.

That is the crux of the problem,.. successive bad governments following bad policies, and blackmailing voters with giveaway budgets.


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## jetstream

Bronte how have i contradicted myself ?? I bought the house because thats where myself and wife wanted to live, I previously looked at Phase one and didnt buy and then bought Phase two which had increased and I presumed Phase three would increase which was the case. Where is the contradiction ? As far as i can seen you have no sensible information or anything constructive to say rather you just quote what others say and then ask them to emphasis on it.


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## Purple

jetstream, the world and it's mother knew that Ireland had a massive property bubble. If you make one of the biggest financial decisions of your life without doing your homework then as an adult you have to take responsibility for that. I agree that the government/regulator/banks were at the very least grossly incompetent but that doesn't negate the culpability of the mortgage holder who took out the loan. If you didn't know in 2006/2007/2008 that the market was going to crash then you must have had your head in the sand.

Where it all breaks down is that the banks haven't shouldered their share of the moral hazard; they loaned money to people who were likely to default against properties that were definitely going to drop in value. Any normal business that traded so recklessly would go bust and rightly so but these jokers are still carrying on. In the normal course of events the banks should be able to take all of the mortgage holders assets to clear as much of the debt as possible and take a hit on the balance. That’s the way it works in business and that’s the way it should work in this scenario but there’s no way a mortgage holder should be able to cry off on the basis that they were too stupid to know what they were doing.


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## oldnick

+1 jetstream. 
I don't know what bronte is on about with those odd, repetitive comments made in such a rebuking manner.


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## oldnick

purples post  . _"...no way a mortgage holder should be able to cry off on the basis that they were TOO STUPID to know what they were doing!"_

-- Again, we have another of those "I knew exactly what was going to happen and if you didnt you're stupid"  comments.

NOBODY knew that there would be a 50-60% plus property crash and a banking collapse and a worldwide economic crisis. These are all inter-connecting events that are causing many people in this state so many problems, not just the property crash per se. 
(- which I don't think even the clever guys who knew prices would drop believed it would be of such magnitude)

Finally, few posters are stating that they are entirely blameless for borrowing too much on high prices, nor that the actions of the govnt, banks,auctioneers, developers et al entirely negates the borrowers responsibility. But it certainly means a sharing of the blame - and ,in my mind, the cost.

And in case I get more comments, as in a previous post,  about how I must have a vested interest in supporting people in trouble, or I must be in negative equity myself .........  I'm not in negative equity. I didn't buy in ireland in the last decade. I don't owe on irish property loans. And  I benefited from easy cheap business loans in the crazy days of 2000-2005. 
I just find the know-it-all comments which I have described as  Tea-Partyish as utterly without understanding or compassion.


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## Purple

oldnick said:


> purples post  . _"...no way a mortgage holder should be able to cry off on the basis that they were TOO STUPID to know what they were doing!"_
> 
> -- Again, we have another of those "I knew exactly what was going to happen and if you didnt you're stupid"  comments.
> 
> NOBODY knew that there would be a 50-60% plus property crash and a banking collapse and a worldwide economic crisis. These are all inter-connecting events that are causing many people in this state so many problems, not just the property crash per se.
> (- which I don't think even the clever guys who knew prices would drop believed it would be of such magnitude)
> 
> Finally, few posters are stating that they are entirely blameless for borrowing too much on high prices, nor that the actions of the govnt, banks,auctioneers, developers et al entirely negates the borrowers responsibility. But it certainly means a sharing of the blame - and ,in my mind, the cost.
> 
> And in case I get more comments, as in a previous post,  about how I must have a vested interest in supporting people in trouble, or I must be in negative equity myself .........  I'm not in negative equity. I didn't buy in ireland in the last decade. I don't owe on irish property loans. And  I benefited from easy cheap business loans in the crazy days of 2000-2005.
> I just find the know-it-all comments which I have described as  Tea-Partyish as utterly without understanding or compassion.



I didn’t know exactly what was going to happen but I did know that we were in a bubble and I did know that the bubble would burst. I didn’t expect a 55% drop (and still dropping) but a 25-40% drop was a reasonable expectation. It was also reasonable to expect the Irish economy to tank after our construction bubble burst as it was reasonable to expect interest rates to increase and tax receipts to collapse. All of that was obvious, totally obvious, unavoidably obvious. If someone makes what will probably be the biggest financial decision of their life without doing their homework then they only have themselves to blame if and when things go pear-shaped.

My house is worth less than I paid for it in 2004 but I got a really cheap mortgage so the total cost of the property (the total mortgage repayments over 30 years) will, I think, still be reasonable. I knew when I bought that it would drop in value and said as much to my wife but the fact that we were trading up and we were getting a cheap tracker meant that it seemed like a reasonable thing to do. In hindsight it may have been better if we’d sold  in 2004 and rented locally but they are the risks you take. If things get bad and we lose our home because one of us loses our job etc then I won’t blame anyone but us; we made the decisions and took out the loan and so, as adults, we are responsible for the consequences of our actions. We do try to mitigate our risk by being well insured but that’s for another thread.

This isn’t about being entirely or partially blameless; if you take out a loan that you then can’t repay then you are 100% responsible for how that impacts on you.
As I have said already it is also the case that if you give a loan to someone who then can’t repay it, who was a bad credit risk to start with, and secure it on an inflated asset then you are 100% responsible for how that impacts on you. That’s where it breaks down; the banks haven’t suffered the consequence of their own stupidity.

This isn’t about blame, it’s about responsibility. Both sides are 100% responsible for how their own bad decisions impact on them.


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## jetstream

Sell said Oldnick . 

Purple, I dont have a problem paying my mortgage as i have already said. The point that i am trying to make is that the system was not regulated and therefore all the mentioned parties could do whatever they wanted.....banks/governement/regulators and the individual that borrowed, and nobody saw a 60% fall in the price of property. 
What i find frustrating is individuals blaming the mortgage holders who are taking the full force of this situation and not blaming the system.


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## Purple

jetstream said:


> What i find frustrating is individuals blaming the mortgage holders who are taking the full force of this situation and not blaming the system.



I don't see anyone doing that. I do see people blaming the banks for decisions they made themselves. 
"The System" is just people making decisions; it doesn't force people to make bad ones.


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## jetstream

A society without policing ends up in anarchy, the same applies to any "system" without regulation and we are now seeing the effects of it.


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## Purple

jetstream said:


> A society without policing ends up in anarchy, the same applies to any "system" without regulation and we are now seeing the effects of it.



I don’t think one follows the other. Plenty of markets are un-regulated. Anyway, the financial services market is heavily regulated, that wasn’t the problem. The problem was bad regulation and incompetent regulators. No matter how good of bad the system may be it still doesn’t force people to make bad decisions. It may allow them but it doesn’t force them.
At what stage do people have to take responsibility for their own actions? The state doesn’t regulate the grocery market to make shops liable if people eat or drink themselves to death. It doesn’t make shoe shop liable if a woman buys a pair of 6” heels and then goes mountain climbing in them. It doesn’t make motor dealers liable if an 18 year old buys a fast car and them kills himself and his friends racing along some back road in Donegal. The state should never attempt to legislate or regulate away a citizens right to make lawful but bad decisions. The citizen controls the state, not the other way around.


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## jetstream

Purple said:


> . The problem was bad regulation and incompetent regulators. .


 
So we can agree on something however if the Financial services market is as you say heavily regulated why did the banks require bailouts? 

AIG, Lehman Brothers, Morgan Stanley, Fannie Mae and Freddie Mac all heavily regulated my the Securities and Exchange Commission but that didnt do much good either.

Mortgage holders should not have to take fully responsibility and therefore the pain should be shared with the financial institutions for those people in difficulty with their mortgage. The banks have received taxpayers money and will continue to receive it.


----------



## in the mire

jetstream said:


> So we can agree on something however if the Financial services market is as you say heavily regulated why did the banks require bailouts?
> 
> AIG, Lehman Brothers, Morgan Stanley, Fannie Mae and Freddie Mac all heavily regulated my the Securities and Exchange Commission but that didnt do much good either.
> 
> Mortgage holders should not have to take fully responsibility and therefore the pain should be shared with the financial institutions for those people in difficulty with their mortgage. The banks have received taxpayers money and will continue to receive it.



Hi Jetstream, I agree with everything you said, The banks took a risk on lending money to a house purchaser, as they would if they were lending to a business etc. So the failure of the risk should be shared, Look at Greece, Bond holders basically gave them money willy nilly without going through the greek books to see if the money can be repaid, Those bond holders are now going to have to take a severe cut on their return because the risk they took failed. so what is the difference between a country failing to repay a loan and getting it restructured and Joe the plumber failing to pay his loan repayments. I was amazed to hear Brendan Burgess (when reading more last nite i discoverd he was chairleader for boom)on radio yesterday supporting as such the joke of a report (keane) published yesterday and also saying there should be no blanket write off of mortgages etc. I agree there should be no blanket write off but the heavy burden must be lifted off joe the plumber so he can (1) pay his mortgage (2) contribute financially to his community as he will have more disposable income to spend thus contributing to job creation. Look at Japan and their lost decade, every one was so much in debt there was no spending for 10 years because the government failed to deal with the debt problem properly. All reputable financial commentators in this country say the same will happen to this country, meanwhile the so called "I pridicted the world financial tsunami" and " I bought my house pre bubble" brigade will be trying to figure out why growth is nil in this country for years to come. the "new begining" will get my support any time.


----------



## Purple

jetstream said:


> So we can agree on something however if the Financial services market is as you say heavily regulated why did the banks require bailouts?
> 
> AIG, Lehman Brothers, Morgan Stanley, Fannie Mae and Freddie Mac all heavily regulated my the Securities and Exchange Commission but that didnt do much good either.


 One of my jobs is to do internal audits on our quality management system. I can spend loads of time and tie to loads of other people’s time auditing but if I look at the wrong areas or don’t understand how things are meant to work or don’t see trends in the information I gather then I’m not doing it properly. There’s a difference between good auditing and lots of auditing. My the same token there’s a difference between light/heavy regulation and good/bad regulation.





jetstream said:


> Mortgage holders should not have to take fully responsibility and therefore the pain should be shared with the financial institutions for those people in difficulty with their mortgage. The banks have received taxpayers money and will continue to receive it.


 The banks should be able to take all the individuals assets, up to and including their pension and family home. After that if the debt is not fully discharged then the lender should have to take a hit for the balance.


----------



## in the mire

Purple said:


> One of my jobs is to do internal audits on our quality management system. I can spend loads of time and tie to loads of other people’s time auditing but if I look at the wrong areas or don’t understand how things are meant to work or don’t see trends in the information I gather then I’m not doing it properly. There’s a difference between good auditing and lots of auditing. My the same token there’s a difference between light/heavy regulation and good/bad regulation.
> 
> 
> 
> The banks should be able to take all the individuals assets, up to and including their pension and family home. After that if the debt is not fully discharged then the lender should have to take a hit for the balance.


Their pension???? Do you want the bank to take their shoes and socks also so they walk bare feet along the street hanging their head in shame. Get real....... also to compare your "internal audit job" should'nt the banks have been doing their own "internal audit" on the country and if they did, then they would have come to the conclusion that it was too risky to lend any more money for property as it was a bubble....  "take their pension"  I've heard it all now.


----------



## jetstream

Or NO REGULATION in this case . Your on a different planet Purple, why not just bring back public execution while u are at it. I really have nothing more to say to you on the matter.


What Patrick Honohan said today:

"It's clearly time for the banks to ramp up their efforts in dealing with truly unsustainable situations," he stated.

"Enough capital has been injected into banks to absorb what I call unavoidable losses from unsustainable mortgages. Inefficiency of capital cannot be a reason to delay action," he added.


----------



## truthseeker

Purple said:


> The banks should be able to take all the individuals assets, up to and including their pension and family home.


 
I wonder what the burden to the taxpayer of supporting such a person throughout their lifetime is versus giving them a hand with their mortgage now. 

If we take away all their assets, including their pension, and they are also unemployed, then the state has to house, clothe and feed them (and maybe their families) - medical care (Ill assume they have also had to cancel their VHI), plus whatever other benefits people dependant on the state get. How much does this come to a year? How many years is such a person likely to be dependant on it? 
Meanwhile the lender is getting bailed out by the taxpayer so the taxpayer is getting hit both ways anyway.


----------



## Kerrigan

Purple, why are you so anxious to get your pound of flesh?  If the powers that be take your stance; than within no time we will have social chaos.  What we are witnessing now is a piece of cake towards what will come down the line.  As Jetstream rightly mentioned the banks will continue to be in receipt of our TAXES.  It is a no win situation.

Truthseekerss post hits the nail on the head.


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## Nationaldude

Purple said:


> The banks should be able to take all the individuals assets, up to and including their pension and family home. After that if the debt is not fully discharged then the lender should have to take a hit for the balance.


 
You mean the banks that have already been bailed out by the taxpayers with enough money to absorb defaults on mortgages?

So Joe Bloggs is now homeless, pennyless, I assume unemployed and dependent on handouts from the state to house, feed & clothe him and his family while the fat cats in the banks sit back and congratulate themselves on job well done?

Get real!


----------



## Purple

in the mire said:


> Their pension???? Do you want the bank to take their shoes and socks also so they walk bare feet along the street hanging their head in shame. Get real....... also to compare your "internal audit job" should'nt the banks have been doing their own "internal audit" on the country and if they did, then they would have come to the conclusion that it was too risky to lend any more money for property as it was a bubble.....



At the moment the banks can take just about everything you have and then go after you for the rest of your life for whatever you don’t have now. That’s unacceptable. It should be the same as a business; take what’s there now and wipe the slate clean. That way an individual can start again. At the moment they can’t. Not only that but interest will continue to accrue on the outstanding balance of the loan. 
If the banks knew that they would definitely be exposed for the balance of whatever the borrower didn’t have if and when things go bang they would be more mindful of their exposure to bad debts. 


Should the banks have been more careful (maybe less reckless would be a better way of putting it) over the last few years? Yes, of course they should. I wish there was some way of making them go out of business without screwing the whole country even more but it seems there isn’t. I wish the directors and senior managers could be charged with reckless trading and sent to prison for a long time, and have every penny they have (including their home and pension) taken away but it seems that our legislators and senior civil servants in the department of finance are incapable of framing legislation on white collar crime. Above all I with Bertie Ahern was in prison (or worse) but it seems he did “nuttin” wrong. 
None of the above negates of mitigates the responsibility of a borrower to behave prudently or to face the consequences of their own actions.


----------



## Purple

Nationaldude said:


> You mean the banks that have already been bailed out by the taxpayers with enough money to absorb defaults on mortgages?
> 
> So Joe Bloggs is now homeless, pennyless, I assume unemployed and dependent on handouts from the state to house, feed & clothe him and his family while the fat cats in the banks sit back and congratulate themselves on job well done?
> 
> Get real!



There shouldn’t be any fat-cats left in the banks. The guys who were at the helm back in the day would be out on their ear by now. 
If the banks write down or write off the mortgage the mortgage it will be the tax payer who pays. If the mortgage holder gets turfed out and had to rely on welfare to get by it will be the tax payer who pays. The banks are owned by us, no matter what way we look at this the tax payer pays. The only way the tax payer can minimise their exposure is to get what they can from Joe Bloggs. If said Joe Bloggs was silly/ lacked foresight/ lived beyond his means it is his more prudent neighbour who will now pick up the tab. The state is us and the banks are us. We’re carrying the can here. There’s nobody else.


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## jetstream

The banks have already received enough capital to write of mortgages as stated today the head of the Central Bank ..... fat cats are still in the banks and now AIB have got the go ahead to pay 1 Million Euro salary for a new CEO ..... talk about a kick in the b****** to the struggling mortgage holders


----------



## Purple

jetstream said:


> Or NO REGULATION in this case . Your on a different planet Purple, why not just bring back public execution while u are at it. I really have nothing more to say to you on the matter.
> 
> 
> What Patrick Honohan said today:
> 
> "It's clearly time for the banks to ramp up their efforts in dealing with truly unsustainable situations," he stated.
> 
> "Enough capital has been injected into banks to absorb what I call unavoidable losses from unsustainable mortgages. Inefficiency of capital cannot be a reason to delay action," he added.


I agree  with him but how does that work? 
Someone borrowed for an asset they can no longer afford so the lender takes a hit so that they can hold onto that asset? Why? What about the people who didn’t buy assets they couldn’t really afford? What about the people who didn’t buy at all because they considered the market to be overpriced? BTW I’m not one of them; I bought my current house in 2004 and it’s now worth far less than I paid for it. 
The banks should write off loans that they can’t get anything back on but they shouldn’t write off loans while the borrower still has an asset against which the loan was secured. 
The Joe/Jane Bloggs that didn’t buy in a bubble now had to pay for the banking losses caused by his/her neighbours default while that neighbour holds onto their house? How’s that fair? What happens if/when the market recovers a bit? The neighbour now has an appreciating asset that they didn’t pay for. How’s that fair?


----------



## Purple

jetstream said:


> fat cats are still in the banks


No, nearly all of the directors of the state owned/supported banks have been replaced.

I have no problem with paying the head of AIB a million as long as he's up to the job.


----------



## jetstream

No need to write off the entire loan, just sit down with the mortgage holder and see what they can afford and work from that. The banks are not even doing that. The country will never recover if this continues, no spare cash means not taxes, negative growth and then back into a recession


----------



## jetstream

Yet 2000 AIB staff cannot get an agreement on a redundancy from the Government


----------



## Purple

jetstream said:


> No need to write off the entire loan, just sit down with the mortgage holder and see what they can afford and work from that. The banks are not even doing that. The country will never recover if this continues, no spare cash means not taxes, negative growth and then back into a recession



I agree. I've made the point here before that if the banks were more proactive in dealing with this there would be less clamour for the government to “do something” about it.


----------



## onq

Purple said:


> No, nearly all of the directors of the state owned/supported banks have been replaced.


Sunny said this in another thread, yet all I could find was a reference back in April of 2011 that this was to occur in the future.

I'd appreciate a link


> I have no problem with paying the head of AIB a million *as long as he's up to the job*.


I think that qualifying phrase is relevant.

I am not convinced that any person could justify charging that amount to a crippled bank with a broken brand.
I think that is an outrageous amount to pay anyone for a follow up role after someone botched the job and crucified shareholders.

I think most observers now agree that paying outrageous amounts like this hasn't attracted competent people to senior positions in the past.
It seems to be a means to soak up money from profits that should be returned to shareholders as dividends to make up for the previous share price collapse.

Now is the time for AIB to be seen to look after its customers and shareholders and build up the brand from the ground up, not re-running the cliché of having a "champion" at the top.

We've had enough of such over paid wonders.


----------



## Purple

onq said:


> I am not convinced that any person could justify charging that amount to a crippled bank with a broken brand. I think that is an outrageous amount to pay anyone for a follow up role after someone botched the job and crucified shareholders.


 If it's a new guy who can turn things around then I've no problem with it but yes, the qualifying phrase is important (which is why I put it there).



onq said:


> I think most observers now agree that paying outrageous amounts like this hasn't attracted competent people to senior positions in the past.


 Right back at me, as it were. 



onq said:


> It seems to be a means to soak up money from profits that should be returned to shareholders as dividends to make up for the previous share price collapse.


 Good management should add more to shareholder value than a €1 million salary will take away.


----------



## Purple

onq said:


> Sunny said this in another thread, yet all I could find was a reference back in April of 2011 that this was to occur in the future.
> 
> I'd appreciate a link


 Sunny's link had a chart that showed most directors were replaced. Download the PDF and squint very hard at it, that's what I did.


----------



## jetstream

A competent Professor or an Economist from one of the colleges in Ireland would do a better job and for a salary far less than 1 million I would image.


----------



## in the mire

jetstream said:


> A competent Professor or an Economist from one of the colleges in Ireland would do a better job and for a salary far less than 1 million I would image.


  the problem with these guys from colleges is that they can't put away the text book, they'd be lost without it. experience is what we need from some guy who will take a low salary and grow it with the company, that should be his incentive, he can leave when he wants then and he can demonstrate to his next employer what he can do therfore demand a good well earned salary, basically do what the rest of us do in our jobs!!


----------



## monagt

> experience is what we need from some guy



We did that and got the T shirt. It was 'experienced' highly paid people who got us into this maybe we need to try the academics, can it be any worse.


----------



## Purple

monagt said:


> We did that and got the T shirt. It was 'experienced' highly paid people who got us into this maybe we need to try the academics, can it be any worse.



Who, Morgan "what's a few tens of billions her or there" Kelly?
Those who can do etc.


----------



## onq

Purple said:


> Sunny's link had a chart that showed most directors were replaced. Download the PDF and squint very hard at it, that's what I did.



He didn't post a link that I saw - which is why I asked for a link?


----------



## onq

RE the salary amount being extortionate I note the following

The suggestion was made (and I am expanding it a bit for effect here) that because a person saves or earns a company more than he costs, he justifies his salary

For the sake of exposition, lets peg that at 40-50% of what he saves/makes the firm.

If you're paying for a competent guy to fulfill a job description, why should he be paid an amount that in any way reflects the value he brings to the company?

I once helped a guy realise a profit of over €750,000 by obtaining a permission.
I didn't ask for €500,000 because he'd gotten an extra €450,000 than what I was asking.

Another client realised a profit of €12Million because of work I did negotiating a permission and designing a housing estate.
This was back in 2002 or so, before things went mad and reflected the difference between zoned land and land with a permission on it.
I didn't get to bill that client €6M.

How can CEO's claim the outrageous salaries they seek? Some are getting bonuses for doing very little it seems.


----------



## Jim2007

jetstream said:


> What Patrick Honohan said today:
> 
> "It's clearly time for the banks to ramp up their efforts in dealing with truly unsustainable situations," he stated.
> 
> "Enough capital has been injected into banks to absorb what I call unavoidable losses from unsustainable mortgages. Inefficiency of capital cannot be a reason to delay action," he added.



This kind of talk is exactly why I have my doubts about this guy!  When the banks were taken over and recapitalized, the loan books were evaluated and the capital introduced was sufficient to bring the banks into line with acceptable European T1 ration requirements.   If we not go and use up that capital writing of what were thought to be good loans, we'll be back to square one in no time once again recapitalizing the banks yet again.

Jim2007


----------



## Kerrigan

Agree Jim2007.

Having read this thread Cromwell is very much alive and well!

Has anybody read the article this morning on the Irish Independent website; about the guy who is now livinging in a NAMA property?  

My point being, if people are kicked out of their homes will we see cases like this springing up all over the country; people squating here there and younder.

I am having difficulties with my computer and cannot copy the link so if somebody would be kind enough . . .


----------



## Ryandd

Hi 
I read the article and happy they let him stay, only I hope that we don't all find we have to follow.  I do think its time for home owners to speak up there is enough of us been made scape goats for bad policies and corrupt dealings in this country we are really mugs for taking it all.   I have been on to the new beginning group who are offering legal advice for people in distress, really worth a call and are very understanding.  I have no problem making realistic payments within my means but I don't want to be told that now the council own your house and you can pay rent to them.  Apparently now people will be categorised into what plan the banks feel you should go with.  I asked the question of negative equity and who was responsible for the shortfall as it never stated in my contract and therefore the responsibility is been forced on homeowners who have lost their jobs and facing on increasingly hard times with the next budget.  I would oppose plans by the government that dictate what happens to our homes and what cateagory we fit into like a herd of cattle.  I applaud all of thees groups Blank of Ireland is another should take a look at their campaign.


----------



## ontour

The guy in the Independent is not a mortgage holder, he took a house in an estate where there are mortgage holders that are suffering the effect of their purchase decision.  The person in question lives off the state and we have now incurred the cost of an investigation and legal proceedings because he decided to claim 'adverse possession' of a house that he had no interest in.


----------



## Ryandd

well the question has to be asked, who was looking after the property that allowed this person to enter and reside there, was it alarmed, maintained, obviously not so they harp on at us for having home insurance and alarms.  If the banks own the property maybe they should take more care in maintaining their interests.  If a court ruled in favour for the person to remain there, they obviously found the owner to be irresponsible, it is obviously another eye off the ball situation for the bankers!


----------



## London Irish

Ryandd said:


> ......I remember Bertie Ahern at the time dismissing David Mc Williams suggestion that the property market had got out of control....



I think you say later that "ordinary" people could not have known what was going to happen, but as you say, there was people (McWilliams et al) who offered an alternate viewpoint. And they were on PrimeTime and the papers, with regular counterpoints from bank economists, EAs and the construction industry.

Both sides lay out their positions on an ongoing basis, and the majority of the population sided with one of them - a sort of affluent apathy. And here we are.

I do feel for your position, but the truth is, the taxpayer can't pay anymore. Yes, the government have already bailed out the banks, etc etc, but in reality that money is debt that is stacked on top on the taxpayer, and the taxpayers children - and will already ruin the nation. There was a storm of comment and protest in the papers and other media when NAMA was formed - but the Irish people seemed largely unmoved, almost unnaturally quiet. (I've always thought that it was a mixture of general apathy and a hope of further bailouts for other interests that ushered in NAMA...)

Yes, bankers and ex-government minsters are getting away with fat bonuses and pensions, and there is still terrible waste in spending, but is that a  reason to look for more money? Surely instead its a reason to stanch the bleeding of cash for the sake our childrens future.

We're been kept alive by the IMF/EU. We have increased the nation debt massively. We blew the NPRF on the banks. We have nothing else in reserve. Its not a case of the taxpayer not wanting to pay for homeowner bailouts, the taxpayer can no longer pay - certainly not in the amounts (billions) that can now make a difference.

These points are made over and over again. I think some people are frustrated that you didn't heed the message and warnings in the boom, and now you are not heeding the message and lessons during the bust. Thats is where a lot of frustration is coming for me, certainly.

We just have to wait for the endgame to play out on the Euro crisis, and ask what lessons from this we really want to pass to the next generation.


----------



## PiedPiper

The tax payer cant pay anymore because they have given away all the money to the banks and the IMF.

The reason the goverment needs all this money is to pay the interest on loans and bonds that have nothing to do with us.


----------



## Ryandd

These points are made over and over again. I think some people are frustrated that you didn't heed the message and warnings in the boom, and now you are not heeding the message and lessons during the bust. Thats is where a lot of frustration is coming for me, certainly.

We just have to wait for the endgame to play out on the Euro crisis, and ask what lessons from this we really want to pass to the next generation.[/QUOTE]

It is very hard to put your life on hold based on economist views in the media especially when government and likes are assuring us, all is well in the country.  People weren't stupid, we were strung along with false hopes and a drip fed fiasco that emerged in 2008 when neither government nor the regulator could face the country honestly to let people know the seriousness of the state of the country it was deception that cost the party its place in politics and they were now all paying the price in some way or another.


----------



## oldnick

lONDON IRISH - The tax-payer will pay far more  if we don't help those in real trouble.

Helping does not mean debt-forgiveness (though this may be needed in a few cases). It means any number of schemes as propsoed by New Beginnings group or  last year by the advisory group(Forget name, B.Burgess was on it).

Not helping -or not properly helping , and the Keane report is certainly an example of "no-real-help", means tens of thousands of families stuck ina situation where they have no money to spend on anything else.Bad for the economy. It means a social despair which weakens society and prevents a country to go forward. And it will certainly mean tens of thousands of people giving up their keys and going abroad or moving into council accommodation. 
If I was in my thirties with children and owed 300k on a 150k property and was faced with the proposals so far on offer i would certainly start planning a life anywhere but here - and throw back the keys. Irresponsible, immoral? UUmm... My family's future versus that of the banks, even of the nation ? An easy choice for an increasing number of people.

These are the real costs of not solving the situation.


----------



## Firefly

There are some very emotive posts in this thread. For what it's worth I am with Purple. Those who cannot repay for what they promised to repay should lose their homes (not sure I would extend that to pensions). I'm self employed and my wife is about to open her own business in the next 2 weeks. Should it all go wrong for us I would expect that we would lose our home. It would be a massive disapppointment surely, but come on..it's not the end of the world. Renting is no longer the bad word it was and there are more important things in life than home ownership. It's also rubbish that people would end up on the streets...there is already movement that will allow them to rent where they currently live from the state as well as hundreds of thousands of houses in the private rental market. Were the banks still in private ownership then I would be more sympathetic to home owners in trouble, but as we now own them, then it's a bit unfair that we should all pick up the tab. As Purple mentioned there are plenty of people who didn't buy or go mad and why should they pay through higher taxes to enable thhose who did over-extend keep the house they should never have bought?

I think it's also incorrect to say that the banks  (and in particular bankers) haven't taken a hit. Granted those at the top who were ousted are no doubt living off nice pensions, but that always happens. I worked in a large Irish bank a number of years ago and am still in regular enough contact with some of my ex-collegues...some had built up quite a nice nestegg in shares over the years and these are all gone. Morale is terrible and lots are trying to leave.


----------



## Bronte

Firefly said:


> I think it's also incorrect to say that the banks (and in particular bankers) haven't taken a hit. I worked in a large Irish bank a number of years ago and am still in regular enough contact with some of my ex-collegues...some had built up quite a nice nestegg in shares over the years and these are all gone.


 
I too know some bankers who have lost everything they had in shares.  Also have elderly relatives who cannot now earn and have lost via bank shares and face a life of penuiry on state pensions instead of the well funded retirement.  Perhaps we should pay for those along with the negative equity generation.  It's a mess but it would be better if people helped themselves and got on with it as a first step.


----------



## London Irish

PiedPiper said:


> The tax payer cant pay anymore because they have given away all the money to the banks and the IMF.
> 
> The reason the goverment needs all this money is to pay the interest on loans and bonds that have nothing to do with us.



Yes. I know that. We all know that. We can walk away from the debt, but we're not going to get the money we put in back. Nor will we get any new lending.
Many people contend we should walk away from the bailout debt and I would be one of them. But doing so doesn't mean we get billions back to spend on a homeowner bailout. Instead the ECB will cut us loose and we'll have a 20 billion euro hole in the economy that the ECB/IMF won't fund anymore.  
One way or another, we have no more money.




Ryandd said:


> It is very hard to put your life on hold based on economist views in the media especially when government and likes are assuring us, all is well in the country.



This "renting = life on hold" mantra needs to be put out to grass or just taken out and shot. 
I'm 36, married with 2 kids, and renting (though my circumstances are different to most as I made the move to emigrate several years ago and am now in the Middle East). Is my life on hold?
My personal view during the boom years was that I could buy and run the risk of being saddled with a huge mortgage and, through circumstance beyond my control, having to put my life on hold trying to pay it back. 
And that's the real story isn't it - many are really, really putting their lives on hold because of their mortgage situation. What lessons are we drawing from this?



oldnick said:


> lONDON IRISH - The tax-payer will pay far more  if we don't help those in real trouble.
> 
> Helping does not mean debt-forgiveness (though this may be needed in a few cases). It means any number of schemes as propsoed by New Beginnings group or  last year by the advisory group(Forget name, B.Burgess was on it).
> ........These are the real costs of not solving the situation.



Do these other schemes cost money? How much? Hundreds of millions? Billions?
We have no more money. So it hardly matters. Will the social fabric of the nation be torn asunder? Will there be families on the streets as many contend? Will the economy implode as everyone stops spending?

I don't know. I just know that the taxpayer has no more money.



Firefly said:


> There are some very emotive posts in this thread. For what it's worth I am with Purple. Those who cannot repay for what they promised to repay should lose their homes (not sure I would extend that to pensions). I'm self employed and my wife is about to open her own business in the next 2 weeks. Should it all go wrong for us I would expect that we would lose our home. It would be a massive disapppointment surely, but come on..it's not the end of the world. Renting is no longer the bad word it was and there are more important things in life than home ownership. It's also rubbish that people would end up on the streets...there is already movement that will allow them to rent where they currently live from the state as well as hundreds of thousands of houses in the private rental market. Were the banks still in private ownership then I would be more sympathetic to home owners in trouble, but as we now own them, then it's a bit unfair that we should all pick up the tab. As Purple mentioned there are plenty of people who didn't buy or go mad and why should they pay through higher taxes to enable thhose who did over-extend keep the house they should never have bought?
> 
> I think it's also incorrect to say that the banks  (and in particular bankers) haven't taken a hit. Granted those at the top who were ousted are no doubt living off nice pensions, but that always happens. I worked in a large Irish bank a number of years ago and am still in regular enough contact with some of my ex-collegues...some had built up quite a nice nestegg in shares over the years and these are all gone. Morale is terrible and lots are trying to leave.



I have to agree with the above. I'm not trying to be harsh or dogmatic but homeowners in trouble need to wait until the bankruptcy law is reformed and brought in line with the norms in the UK, for instance, then enter bankruptcy proceedings and get on with their lives.


----------



## oldnick

Why are some posters objecting to something that almost noboy is proposing?  (_E.G. people should pay their debts ! The taxpayer can't afford to pay for these people!)_

Where does anyone say that there should be a blanket debt forgiveness -either in this thread or generally ? Do not these posters read the papers or watch the news ?. Are they completely unaware of the many proposals made by the bodies alluded to previously, such as New Beginnings et al ?
 None of the proposals mean the taxpayer is forking out a fortune to pay for those in trouble, or, at the very least, on a couple of ideas the cost to the tax-payer is no different than the tax-payer would pay anyway for social housing tenants.

So, please , no more responding to comments that were never made.


----------



## oldnick

clarification on New Beginnings . I;m aware that some proposals do involve a cost to tax-payer and I refer  to the interesting discussion on other threads such as "how to deal with mortgage crisis".
My point is that this is one of many proposals made by this body and by Brendan Burgess's body, and nowhere is a blanket debt forgiveness proposed -and at worst a couple of suggestions involve a subsidy  or partial debt forgiveness.


----------



## peelaaa

London Irish said:


> Yes. I know that. We all know that. We can walk away from the debt, but we're not going to get the money we put in back. Nor will we get any new lending.
> Many people contend we should walk away from the bailout debt and I would be one of them. But doing so doesn't mean we get billions back to spend on a homeowner bailout. Instead the ECB will cut us loose and we'll have a 20 billion euro hole in the economy that the ECB/IMF won't fund anymore.
> One way or another, we have no more money.
> 
> 
> 
> 
> This "renting = life on hold" mantra needs to be put out to grass or just taken out and shot.
> I'm 36, married with 2 kids, and renting (though my circumstances are different to most as I made the move to emigrate several years ago and am now in the Middle East). Is my life on hold?
> My personal view during the boom years was that I could buy and run the risk of being saddled with a huge mortgage and, through circumstance beyond my control, having to put my life on hold trying to pay it back.
> And that's the real story isn't it - many are really, really putting their lives on hold because of their mortgage situation. What lessons are we drawing from this?
> 
> 
> 
> Do these other schemes cost money? How much? Hundreds of millions? Billions?
> We have no more money. So it hardly matters. Will the social fabric of the nation be torn asunder? Will there be families on the streets as many contend? Will the economy implode as everyone stops spending?
> 
> I don't know. I just know that the taxpayer has no more money.
> 
> 
> 
> I have to agree with the above. I'm not trying to be harsh or dogmatic but homeowners in trouble need to wait until the bankruptcy law is reformed and brought in line with the norms in the UK, for instance, then enter bankruptcy proceedings and get on with their lives.


 
But how long do people have to wait, we are already being told that we will be out of the recession in 5 years, but we have already been in it for 3 years, how long are you talking then. None of us are getting younger, I want to live my life and not think about the states problems over my own family. The state as I see it have left us to our own devices to sort out, no assistance, if thats the case then why should people not leave. 
I can't see Ireland ever changing for the good. 
The mess was caused by the state, simple as that. NAMA should never have occurred.


----------



## Kerrigan

I don't understand why some people on this thread are still not grasping that removing people from their homes will only be a worse burden on the TAX payer.  Frying pan to fire comes to mind


----------



## ontour

Kerrigan said:


> I don't understand why some people on this thread are still not grasping that removing people from their homes will only be a worse burden on the TAX payer.  Frying pan to fire comes to mind



What is the evidence for this?  Some people who lose the properties that they purchased will require social housing but many would have the means to rent.  Many people may not be able to afford 2.5k of a mortgage but have the income to pay 1k in rent.

The burden on taxpayers is leaving people in limbo for years and hoping that things will get better.  We have already had years of the state supporting people with unsustainable debt.

Stop blaming the mortgage holders................. until there is an efficient way for them to get out from under their debts, even if it means forgoing assets ( which are really liabilities!).


----------



## Kerrigan

What happens the houses that are repossessed?

My guess is the banks will cry wolf, when they realise how many keys are handed back.  The then overly burdened TAX payer will have too dig deep once again

I take on your points Ontour but will there be as many 'paying' renters around or will it all be rent allowance?  

'Paying' renters need jobs and as we all know there doesn't seem to be a whole lot of them about.


----------



## whatelse

London Irish said:


> I'm not trying to be harsh or dogmatic but homeowners in trouble need to wait until the bankruptcy law is reformed and brought in line with the norms in the UK, for instance, then enter bankruptcy proceedings and get on with their lives.


 
Any idea when this law will be reformed?


----------



## ontour

Kerrigan said:


> What happens the houses that are repossessed?



The are sold and bought by home-hunters, private investors, housing associations or local authorities.



Kerrigan said:


> My guess is the banks will cry wolf, when they realise how many keys are handed back.  The then overly burdened TAX payer will have too dig deep once again


 
The tax payer is currently on the hook for a lot of unprofitable tracker mortgages.  Liquidating some of these mortgages may reduce the cost to the bank / state.


----------



## Bronte

Kerrigan said:


> What happens the houses that are repossessed?
> 
> My guess is the banks will cry wolf, when they realise how many keys are handed back. The then overly burdened TAX payer will have too dig deep once again


 
And my guess is that the bank are playing a waiting game as they have no clue if the market will pick up again anytime soon but are hoping  it will.  But you can be sure if it does that those who were in negative equity who have not paid full mortgage amounts will be slapped with all kinds of fees to add to their woes as the banks start to evict them and get their pound of flesh.  That is what happened in the past with those who didn't pay their mortgages, the banks current problem is that there is too many right now and they cannot flood the market and depress it even futher.  So right now it's a catch 22 situation and a waiting game.


----------



## Firefly

Bronte said:


> And my guess is that the bank are playing a waiting game as they have no clue if the market will pick up again anytime soon but are hoping  it will.  But you can be sure if it does that those who were in negative equity who have not paid full mortgage amounts will be slapped with all kinds of fees to add to their woes as the banks start to evict them and get their pound of flesh.  That is what happened in the past with those who didn't pay their mortgages, the banks current problem is that there is too many right now and they cannot flood the market and depress it even futher.  So right now it's a catch 22 situation and a waiting game.



I think you are right Bronte. The banks will try to dripfeed these properties onto the market in an orderly fashion should the property market recover.


----------



## London Irish

Nope.


----------



## London Irish

whatelse said:


> Any idea when this law will be reformed?



Nope.


----------



## Ryandd

I think the banks punishing people for not being able to pay their mortgage by adding fees and penalties is pointless at this time, like getting blood from a stone, when will they realise that 500 thousand and growing are out of work with no hope in sight.  Agencies like new begginings are representing the mortgage holders in impossible situations and offer a great service, they are in talks with government and hopefully a solution will be reached soon, the problem is one shoe does fit all and I think they will have a difficult task ahead.  Every household has a different situation to its neighbours for example couples wanting to split up, others wanting to downsize or find bigger accomodation, repossessing houses for people who want to surrender their homes for their own reasons will mean years of bad credit rating and continue to look for state support through the vast jobloss through no fault of their own.


----------



## qljiea784hl1

I'm not a financial whiz or economist.


----------



## ontour

Ryandd said:


> I think the banks punishing people for not being able to pay their mortgage by adding fees and penalties is pointless at this time,



It is not pointless for the bank as there is a chance that a solution may involve writing off a percentage of the total debt and they could include fees, penalties and charges in this calculation.  The banks have nothing to lose by applying these fees and penalties.  In many cases they will get nothing but for the sake of a bit of paper work, they will get some of it.

There also has to be a obvious penalty to missing repayments otherwise lots of people would skip mortgage repayments.


----------



## onq

People who acted unprofessionally towards their clients charging them for the consequences of their unprofessional advice should not succeed in Court.

I attended recently in a country District Court and while orders were made for repayment of the principal according to people's ability to repay, costs were struck out.

As far as I could see the orders were all for mortgage payments in arrears and penalties were not included, but as I couldn't see the charge sheets its unclear if penalties were included.

Given the fact that the solicitors costs were not being awarded, I am doubtful that penalties were included.


----------



## Ryandd

The banks should really be asking themselves why do they think so many people aren't able to pay their mortgage.  I would really like to hear that answer, anyone who contacts their bank in distress over money matters should not be charged additional fees and penalties for their misfortune talk about adding insult to injury.  The genuine hardworking familes in this country are not being given a fair hearing its their fault face the consequences and thats the end of that, there is no responsibility on the banks or its policies which were a direct cause in this chaos, back benchers in the dail chambers may whistle in the wind as far as government actions on this issue will be dealt with, I appreciate they are voicing on behalf of families they meet everyday and are in constant battle with ministers on the issue of mortgage arrears and negative equity which was as a result of non regulation of the banks in the first place.   If we are not offering banks our money we aren't worth the effort in cusotmer service and all that goes with Moral standards


----------



## ontour

Ryandd said:


> I would really like to hear that answer, anyone who contacts their bank in distress over money matters should not be charged additional fees and penalties for their misfortune talk about adding insult to injury.



When a person goes in to arrears or default there is a cost to the bank.  The bank endeavours to recover that cost from the person that is the cause of that cost where possible.  Obviously in the cases of default it is highly unlikely to ever be recovered.

The money to pay these costs will come from somewhere.  Is it your opinion that the mortgage holders of that bank who are servicing their repayments should pay to deal with chasing those in arrears?  There is no doubt that banks in Ireland have been very poor at communicating with their customers but this is also true of the customers with their banks.


----------



## mccabes2

whatelse said:


> Any idea when this law will be reformed?


 
The IMF bailout package required the Irish Government to address the failings in our bankruptcy laws by the first quarter of 2012... still, it's not surprising that nothing has happened...


The recent reduction in the bankruptcy penalty period from 12 to 5 years (contained in the Civil Law (Miscellaneous Provisions) Act 2011, came into force this month) will probably be used to argue that this criteria has been met, despite the fact that the long penalty period was only part of the problem in our long-winded, expensive approach to bankruptcy.


----------



## mccabes2

Extensive bankruptcy reforms were suggested by the Law Reform Commission in a 2010/11 report on personal debt, and these suggestions have recently been packaged into a bill along with some less thoroughly analysed plans for mortgage arrears, by Fianna Fail (discussed in another topic that Brendan has created). We'll see anyway!


----------



## Yachtie

Ryandd said:


> Hi Bugler - In some respects your correct on definition of family home but when banks were lending, it was highlighted that renting was paying dead money when you can be working to pay for a property what you could hopefully own one day and provide security for your family - this would have been my wish which was why i expressed family home in this way.


 
How exactly is renting paying dead money? Is paying for bread and milk dead money too as it will end up in a toilet?

Rent entitles you to a use of property which you may or may not chose to consider your home. I have been hearing this 'dead money / money down the toilet' argument for years and it never fails to rile me. I used to rent a fabulous brand new beautifully furnished duplex from a very nice and reasonable landlord who sent cheques immediately for any maintenance including annual carpet cleaning. Please explain how paying for a property outside of my financial reach at the time, in terms of size and location was 'money down the toilet'?


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## ClubMan

Yachtie said:


> Is paying for bread and milk dead money too as it will end up in a toilet?


I must remember that one next time this perennial argument comes up in polite discussion over the dinner table...


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## Firefly

Yachtie said:


> How exactly is renting paying dead money?



Because you could be using the money to pay off a mortgage, which in the end, will leave you with a house and no more rent to pay..


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## ClubMan

Is the interest paid on the mortgage (i.e. the "rent" paid on the capital borrowed) also "dead money"?


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## Firefly

ClubMan said:


> Is the interest paid on the mortgage (i.e. the "rent" paid on the capital borrowed) also "dead money"?



True as it's an unavoidable cost of borrowing and ideally it would be better (for a house buyer's perspective) if the interest was lower than the rates for renting. 

Interest rates and rents will fluctuate over the term and not necessarily in tandem as we have seen recently. However, one positive about buying (and I use the term "positive" loosly) is that it forces you to pay down the principle. At the end of the term you own the asset/house. Assuming that the price of the house doesn't budge over the term, then if you are renting, you would have to be diligent enough to save the same mortgage payment (excluding the interest componant) every month. Some people would be good at doing this but I would imagine most would not be. The money could quite easily be frittered away..


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## Mpsox

ClubMan said:


> Is the interest paid on the mortgage (i.e. the "rent" paid on the capital borrowed) also "dead money"?


 
Historically no since most people would have the expectation that the value of their property would, at some stage in the future, exceed the cost of the mortgage, including interest. At the end of the mortgage, you have an asset, at the end of a lease, you have nothing of value

However, given the negative equity position a lot of people find themselves in, then you could argue for those people, that it is dead money.


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## ClubMan

Firefly said:


> True as it's an unavoidable cost of borrowing and ideally it would be better (for a house buyer's perspective) if the interest was lower than the rates for renting.


But somehow paying for one service (interest/rent on money borrowed to buy property) is less bad than paying for another (accommodation)?


> then if you are renting, you would have to be diligent enough to save the same mortgage payment (excluding the interest componant) every month.


The renter can deduct all property purchase related transaction costs and a few decades of maintenance costs from their savings target so they have a bit of a head start on the purchaser.

I'm not arguing that renting is better than purchasing or vice versa (and what's best will depend on the details of a specific situation) - just trying to balance some of the "rent is dead money" arguments...


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## bugler

ClubMan said:


> Is the interest paid on the mortgage (i.e. the "rent" paid on the capital borrowed) also "dead money"?



People have constantly, and in many cases wilfully, misunderstood this, that is that you must also pay "rent" on your mortgage. Few of those so keen  to buy property are willing to recognise that, even now. 

An estimate of the total cost of credit should be made clear to anyone obtaining a mortgage. That your €300,000 house may cost you closer to €600,000 before you are done is a point I suspect many would be shocked at.


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## ClubMan

bugler said:


> An estimate of the total cost of credit should be made clear to anyone obtaining a mortgage. That your €300,000 house may cost you closer to €600,000 before you are done is a point I suspect many would be shocked at.


As far as I know such an estimate IS set out on mortgage approval/contract forms (albeit of necessity based on certain assumptions such as prevailing rate). (Now - who's going to be first to argue that inflation should also be factored in to get the real effective cost...? ).

Update: just noticed that _Karl Jeacle's _mortgage calculator does have a basic facility for factoring inflation into the cost of mortgage calculations... 

http://www.drcalculator.com/mortgage/ie/


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## Firefly

I'd also argue that you have more control when buying a home...if you have the means, then you can drastically reduce the amount of interest paid by shortening the mortgage term. As an example a 15 year mortgage of 250k from BOI at current rates over 15 years works out at approximately 1,830 per month. Over the term total interest will be 130k which works out at 540 euro per month. Conversely, for the same principle over 30 years the interest works out at 1,100 per month.

Apart from finding a cheaper house to rent you really do not have this control when renting.


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## ClubMan

Mpsox said:


> However, given the negative equity position a lot of people find themselves in, then you could argue for those people, that it is dead money.


Or you could just accept that it's reasonable to pay for any service whether it be renting accommodation or renting money if your circumstances are such that you need these services. Talking about "dead money" is meaningless in my view.


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## Purple

ClubMan said:


> Or you could just accept that it's reasonable to pay for any service whether it be renting accommodation or renting money if your circumstances are such that you need these services. Talking about "dead money" is meaningless in my view.



I agree completely.
I've been having discussions about this for the last 10 years. Few people take the cost of borrowing into account. Given that yields tend to reduce as the value of the property increased (probably due to the floor the government places on the rental market through rent allowance payments) the nicer/better located the property is the more sense it makes to rent.


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## Firefly

ClubMan said:


> But somehow paying for one service (interest/rent on money borrowed to buy property) is less bad than paying for another (accommodation)?



Definately...you won't feel intimitated at dinner parties 

I agree...unless you have the readies to buy outright, interest and rent are both dead money. For some reason. most people seem happy to pay interest to a bank rather than rent to a landlord. 

The advantages of buying over renting (or vice versa) is a massively different thread and one I don't have any particular interest in posting on!


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## London Irish

whatelse said:


> Any idea when this law will be reformed?



I replied "Nope" to this earlier, but now seems a bill will be published in Q1 2012: http: //debates.oireachtas.ie/dail/2011/10/25/00006.asp



> Deputy Alan Shatter: In line with a commitment in the programme for Government the personal insolvency Bill is in the course of being developed in my Department to provide for a new framework for settlement and enforcement of debt and for personal insolvency. The commitment under the EU-IMF Programme of Financial Support for Ireland is to publish the Bill in the first quarter of 2012. It is my objective to publish the measure ahead of the EU-IMF deadline, if possible. Moreover, it is intended that the heads of the Bill, which are expected to be finalised in the near future, will be forwarded to the Committee on Justice, Defence and Equality for its consideration....


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## Yachtie

Firefly said:


> Because you could be using the money to pay off a mortgage, which in the end, will leave you with a house and no more rent to pay..


 
Agreed, but you haven't factored in the interest, insurance, maintenance, decorating, management fees, cost of commute to work, etc. If you added all this and spread it over the life of mortgage, you'd be surprised what works out better. Albeit, it wasn't the same calculation a few years back when the house values doubled every three months.  



Firefly said:


> I'd also argue that you have more control when buying a home...if you have the means, then you can drastically reduce the amount of interest paid by shortening the mortgage term. As an example a 15 year mortgage of 250k from BOI at current rates over 15 years works out at approximately 1,830 per month. Over the term total interest will be 130k which works out at 540 euro per month. Conversely, for the same principle over 30 years the interest works out at 1,100 per month.
> 
> Apart from finding a cheaper house to rent you really do not have this control when renting.


 
That's one kind of control. Over the last couple of days I have seen the same teaser on RTE about the Prime Time which features commuting to and from work. They use some guy who spends 30 hours (!!!!!!) a week commuting. If he (or anyone in similar circumstances) feels that buying in the arsehole of nowhere just to own rather than 'throw money down the toilet' by renting was a smart thing to do, I don't feel sorry for them at all.  



ClubMan said:


> Or you could just accept that it's reasonable to pay for any service whether it be renting accommodation or renting money if your circumstances are such that you need these services. Talking about "dead money" is meaningless in my view.


 
That makes any money spent on solicitors, accountants, car mechanics, medical / dental professionals or anyone and anything that provides a service rather than a tangible item, dead money.


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## ClubMan

Yachtie said:


> That makes any money spent on solicitors, accountants, car mechanics, medical / dental professionals or anyone and anything that provides a service rather than a tangible item, dead money.


Er - why the rolley eyes so? That's exactly my point - it's ridiculous to call fair payment for a necessary service "dead money" - and that includes accommodation rental.


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## Ryandd

In fairness I think the renting/buying argument may be put out of our hands if Government have their way, it may be a case for many that we are paying rent to the local council for the privilege of living in our homes " what a depressing thought"


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## Firefly

Yachtie said:


> Agreed, but you haven't factored in the interest, insurance, maintenance, decorating, management fees, cost of commute to work, etc. If you added all this and spread it over the life of mortgage, you'd be surprised what works out better. Albeit, it wasn't the same calculation a few years back when the house values doubled every three months.



I've mentioned interest...it should be the same as rent.  

Let's take a house costing 300,000 today with a mortgage of 20 years.

Insurance is unavoidable alright. Let's say it's 800PA.  That's 16,000 over 20 years. 
Maintenance is difficult to estimate - all down to the house you buy really. Lets say it costs 600 euro a year. That's 12,000 over 20 years.

Decorating is subjective. As a home owner you are more likely to spend more on decorating your home than if you were renting. Having said that, you could quite easily not decorate your house at all. Let's put that down to 800 a year, which is 16,000 over 20 years.

Not all houses have management fees, but let's say for this exercise they cost 1,000 per annum which is 20,000 over the 20 years.

You ommited propert taxes and who knows what the amounts will be but let's say they are 500 per year which is another 10,000 over the 20 years.

Total costs over the life of the mortgage are 74,000 or 25% of the 300,000. A 1.1% annual rise in the price of the house would be required to recoup this 74,000. Discussion on house prices is not allowed on AAM but the example I've provided is simply to show what a house _would need to_ appreciate in value by to recoup the cost of ownership. 



Yachtie said:


> That's one kind of control. Over the last couple of days I have seen the same teaser on RTE about the Prime Time which features commuting to and from work. They use some guy who spends 30 hours (!!!!!!) a week commuting. If he (or anyone in similar circumstances) feels that buying in the arsehole of nowhere just to own rather than 'throw money down the toilet' by renting was a smart thing to do, I don't feel sorry for them at all.



 I agree 100%. I could never for the life of me understand how people could commute like that. We bought an apartment and then a house in Dublin some years ago and we always bought in the city. We traded in space for convenience and glad we did so.
[/QUOTE]


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## Swyper

ClubMan said:


> Talking about "dead money" is meaningless in my view.



The term "dead money", as far as I remember, became common in the late nineties and early noughties. People forget that prior to the asset bubble which began around 2001, there was a rent bubble in the prior 6 years. By 2001 rents had risen so much, and interest rates fallen so much, that it was not uncommon for rent to be more than interest + principal.

If you're comparing paying 1,000 a month in rent, and owning nothing at the end, or paying 1,000 in mortgage payments and having some equity at the end, then rent was of course, "dead" money. You were paying someone else's mortgage.

In my view, this momentum continued through 2002 and beyond even after the rent bubble was burst (static and falling rents since 2002) as people starting having pavlovian responses to offers to buy property instead of looking at the underlying financials. Since the rent bubble burst, there is no "dead money" out there. At some point in the next few years, we may see the return of "dead money" with falling property prices, lower repayments, and more people wanting to / having to rent rather than buy.


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## eamo27

Bronte said:


> I'm assuming that for these 8 reasons your purchased your home.
> 
> 1. How much did you borrow and what was your income and what was the purchase price and how much of a deposit did you have?
> 
> 2. Can you clarify the advice the bank gave you, did they say you can borrow as much as x and did you borrow x or less
> 
> 3. Cannot tell if you were reckless until you give cold hard figures and location and type  of property
> 
> 4. Who gave you the advice that this home was a good investment?  What exactly was that advice
> 
> 5. How did Bertie Ahern affect your decision to purchase a home
> 
> 6. So?  Banks always have targets to lend?
> 
> 7.  What bank product are you referring to?  Did your parents help you in the purchase?
> 
> 8.  Which government campaign are you referring to?
> 
> Do you now have a home in which to raise a family?



Oh dear - didn't take long 'moral Police' to arrive.


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## Purple

eamo27 said:


> Oh dear - didn't take long 'moral Police' to arrive.



Yes, people who ask reasonable questions are 'moral police'.


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## Ryandd

Purple said:


> Yes, people who ask reasonable questions are 'moral police'.


 
Purple 
If this is the case then please give example of question and how it makes a difference to ones situation.


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## Purple

Ryandd said:


> Purple
> If this is the case then please give example of question and how it makes a difference to ones situation.



You made various points which implied that people were not responsible for buying over priced houses. Some of them were vague while others were simply untrue. Bronte listed out those points and questioned you about them. I don’t see how this makes Bronte a member of the “moral police”. 

I also have a big mortgage and I am in negative equity. If I lose my house then I won’t blame anyone other than myself (and my wife) since we were adults when we bought the house and so are responsible for our own actions.
I have huge sympathy for people in negative equity, my own sister had to sell her house and move back in with my parents, but I an 100% against other tax payers subsidising mortgage holders so that they can acquire an asset and I am sick of hearing adults behaving like children and blaming others for the decisions that they made.


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## oldnick

Purple -whilst i usually agree with much of what you write -and well-written too - I wonder if you may not be being  a bit hard here.

If something bad happens that affects someone does that mean that we should not help them  even though the sufferer should have known the risks?

Do we leave the injured driver of a speeding car because he should have known better than to speed? 
Do we not send out  lifeboats or mountain rescue teams for those who negligently went to sea or up mountains in poor conditions?

Extreme examples - but at what point do we cut off helping those in trouble or distress, even though their own actions led to their condition?

And - one could debate whether their own actions did actually lead to their present circumstances.  Surely, it is not just that people "should have known" there was a risk factor in buying a house, but also that they should have known that there could be mass unemployment, banks collapsing, worldwide economic distress etc etc. 

Today's situation is so different from any normal prediction of risks that blaming those in dire straits today -and refusing to help them - because they "should have known the risks" seems ,well, cruel.


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## Purple

I don’t think people can be expected to have seen this recession coming; a recession yes, but not one this bad.
That still doesn’t mean that people shouldn’t take responsibility for their own actions or that it was all someone else’s fault. 
There is always an element of risk and there is always the option to insure against that risk. The notion that because the country was so badly run individuals should somehow be insulated from their own misfortune (or stupidity) is juvenile. The world is a big bad place and bad things happen. I think the fact that Ireland is so insulated from the harsh reality that most of the rest of the world lives in Irish people think that “someone” will always be there to “do something” to sort out their problems. That just isn’t so and shouldn’t be so. Otherwise people will take risks which will benefit them if they pay off but which they will be able to walk away from if they don’t work out.

"Helping" - welfare to provide a basic level of income is helping. Using other people's money to buy as asset for someone is unjust.


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## Yachtie

ClubMan said:


> Er - why the rolley eyes so? That's exactly my point - it's ridiculous to call fair payment for a necessary service "dead money" - and that includes accommodation rental.


 
Just saw this now. Rolley eyes weren't for you and your comment.


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## ClubMan

Yachtie said:


> Just saw this now. Rolley eyes weren't for you and your comment.


OK - but then I don't know why they came on foot a quoted comment from me...


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## Ryandd

I am now in my second year of unemployment and it is very distressing on all the family.  Belts have been tightened and just glad to see the back of Christmas, The new proposed bill announced is complicated at best, and I'm hoping that we don't have to resort to it and that I will find work.  But the reality is that arrears are now at an impossible level and increasing every day.  I hear comments coming in from listners on radio stations giving out that they are bailing out their neighbours but believe me and I hope I speak for the majority in saying we would rather find a job and pay our own way as we have been doing.   If I had a neighbour in a desparate state I would just be thinking how lucky I was because this will stay with people for a very long time and it is bad enough that people are living from one day to the next not knowing or being able to plan for anything, no hope and despair, this is not an easy way out.


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## Swyper

ryandd said:


> i am now in my second year of unemployment and it is very distressing on all the family.  Belts have been tightened and just glad to see the back of christmas, the new proposed bill announced is complicated at best, and i'm hoping that we don't have to resort to it and that i will find work.  But the reality is that arrears are now at an impossible level and increasing every day.  I hear comments coming in from listners on radio stations giving out that they are bailing out their neighbours but believe me and i hope i speak for the majority in saying we would rather find a job and pay our own way as we have been doing.   If i had a neighbour in a desparate state i would just be thinking how lucky i was because this will stay with people for a very long time and it is bad enough that people are living from one day to the next not knowing or being able to plan for anything, no hope and despair, this is not an easy way out.



+1


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## PayinDGerrys

Recently a person in my area committed suicide to escape their debts, now the outstanding amount was a modest fee (if everyone at the funeral donated €100, it would have almost clear the debt). Afterwards people were commenting if they only knew how much they were struggling they could have helped the person out, but saying that if the person had approached these people to arrange financial help they would probably not have given assistance.
From what I know the system failed in this instance, with little or no support to the poor individual and relentless calls and visits from a debt collection agency it eventually got too much for them.

It sounds horrible but I really think suicide over the next few years will reach epidemic proportions as mounting debts take their toll mentally on these people.
I urge you all please to think twice before judging people for being greedy, ok some lived beyond their means but the mental pressure and stress these folk are under right now is huge!
Everybody knows someone who is struggling in some way or another, maybe ask them if you can help out, a spare €50 would go a long way.. Descretely, you never know how much it could pull them back from the brink of depression.


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## jackbetal

The majority of those caught up in it lived through the 80's alright. They were not even in their teens at that stage. Of course they should have known.

Also a crash like this has never ever happened before anywhere in the Western World since records have been taken. Fact.


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## jackbetal

Shocking. So many casualties of this. If there is a heaven I hope that this person is confronting a certain Brian Lenihan (if he got in) as we speak.


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## ontour

jackbetal said:


> Shocking. So many casualties of this. If there is a heaven I hope that this person is confronting a certain Brian Lenihan (if he got in) as we speak.



Would you like to explain why you singularly blame Brian Lenihan for the recession, property crash and the current pain of the many casualties?


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## jackbetal

ontour said:


> Would you like to explain why you singularly blame Brian Lenihan for the recession, property crash and the current pain of the many casualties?



I never said I "singularly blame Brian Lenihan for the recession, property crash and the current pain of the many casualties". What I do blame him for though is being the Minister for Finance who is responsible for the most damaging decision taken in Ireland in current history when he guaranteed private banking debt with the people of Irelands money. He then compounded that decision with a multitude of other extremely bad decisions afterwards whilst continually lying straight faced to the Irish people. 
Just calling a spade a spade.


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## ontour

Jackbetal,  Even the little bit of debt that was not guaranteed has had to be paid back.  The bank guarantee made no difference to what Europe expected of us, it was quite simply 'Pay back all soverign and bank debt'.  The bank guarantee was bad if you believe that exiting the EU was the best thing for Ireland, in that case there was no need to nationalize the bank debt.

Personally I think that he did the best that he could based on the advice received and we know he went to various sources for advice.  I don't think he did it for personal gain,  actually he was probably one of the politicians that has acted in the least self interest.


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## jackbetal

We will just have to strongly agree to disagree on his decision. Lenihan took private bank debt and put it on the backs of the Irish people. What Europe expected or didn't at that stage is besides the point. He should have been more concerned about the Irish people. Also there is the fact that he was part of the party that got us to that night in the first place. And of course you failed to mention the fact that he continued to lie straight faced to the Irish people afterwards right up to his untimely death. 
Don't be under any illusion. lenihan and his ilk are only always protecting their own. His family will remain a wealthy family whilst the poor people of Ireland suffer.
Like his father left slip before him when he said "We can't all live on a small island."I am sure Lenihan junior would have been of the same mindset.


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## Jim2007

I'm always amazed at how people seem to thing that banks can go bust, financial systems can crumble and yet it will have little impact on them...

Imagine you wake up tomorrow morning to fine that every cent you have in the bank is gone, there will be no salary next payday, your house and other assets are worthless because not one has money to buy them off you, prices in the shops are going up by the minute and all you have is say 50 Euros in your pocket....

I was at Zurich airport at the hour when they literally ran out of cash and while it was the most amazing sight I have ever seen, it was also frightening to see what can happen!  First staff realized that they would not be paid and started to walk of the job, then of course they realized that they would never be paid, so they better take something with them.... Then tourists decide that they better find their own baggage, oh and since they had just lost their flights, they might as well take something with them as well....  the idea of something like that playing out at every single firm in the country at the same time.....

Also, of course there was no bail out, as people seem believe.  The real bankers - ones that actually owned the banks lost everything and the sate ended up owning the lot....

I don't think it makes the slightest difference who was in power, once the bubble started there was only ever going to be one outcome and the only unknown was the timing....


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## jackbetal

I'm always amazed at how people still paint the doomsday scenario that was never going to happen to support the most corrupt and incompetent decision ever made by Irish politicians. If Anglo Irish or Irish Nationwide were left to go down the path that they had chosen themselves then there would have still been money in the Irish bank machines. To say otherwise is either very foolish or very naive. Brian Lenihan along with Cowen and a few others should be held accountable for what they did.


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