# Repossession is a valid outcome for someone in arrears



## bugler

Given the multiple press stories and movement on the CCMA etc, it seems the arrears epidemic is finally going to be tackled in some way.


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## demoivre

bugler said:


> Given the multiple press stories and movement on the CCMA etc, it seems the arrears epidemic is finally going to be tackled in some way.



That wouldn't be my take on it. Roughly 80000 mortgages have been restructured of which 144  are split mortgages and 8 are trade downs - so only 152 (0.19% ) long term solutions have been reached between bank/borrower despite the Central Bank telling the banks to get their act together regarding long term solutions to mortgage arrears !


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## bugler

The way most mortgage arrears in the longer term categories are going to be tackled is via repossession and voluntary surrender. Those are valid outcomes, present in any functioning market.

Removing restrictions on number of contacts per month, removing tracker mortgages from those in arrears, and shortening the time it may take to initiate legal proceedings are definite step towards long overdue repossession/surrenders.


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## Gerry Canning

bugler said:


> The way most mortgage arrears in the longer term categories are going to be tackled is via repossession and voluntary surrender. Those are valid outcomes, present in any functioning market.
> 
> Removing restrictions on number of contacts per month, removing tracker mortgages from those in arrears, and shortening the time it may take to initiate legal proceedings are definite step towards long overdue repossession/surrenders.


 
Inclined to agree; we need to sort the won,t pay versus the can,t pay.
I would be cocerned that the Banks will focus in on the genuine case where they can squeeze funds rather than the (hopeless) chancer.
It is a tough call, I hope it is balanced and I don,t particularly trust Banks ? I hope there are some ENFORCED checks to keep an eye on Banks ?


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## demoivre

bugler said:


> The way most mortgage arrears in the longer term categories are going to be tackled is via repossession and voluntary surrender. Those are valid outcomes, present in any functioning market.



They are not valid outcomes for society or the person who wants to stay in their home imo. Most unsustainable mortgages could be made sustainable by a split mortgage. The fact is banks aren't playing ball as indicated by the fact that only 144 splits have been agreed out of 142,000 arrears cases, even though the CB wants banks to introduce more long term arrangements with people in arrears.





> Removing restrictions on number of contacts per month.


Anyone who feels harassed by numerous phone calls form a bank should contact the guards without delay and let them deal with it under the Non-fatal Offences Against The Person Act 1997.


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## bugler

demoivre said:


> They are not valid outcomes for society or the person who wants to stay in their home imo. Most unsustainable mortgages could be made sustainable by a split mortgage.
> .



I think it is a perfectly valid outcome for society. Anyone taking out a mortgage does so knowing it comes with certain responsibilities. If you can service your mortgage, you keep your property. If you cannot make any real effort to do so, you can't. If we want there to be any incentive for credit-lending there has to be the ability for the lender to repossess. 

How long exactly should someone be allowed stay in their home without making mortgage repayments? 1 year? 2 years? 5 years? A simple answer please. There are a substantial number of people well over a year in arrears. They may have very uncertain prospects of a job. How long should they remain in the house while it is completely uncertain whether they will ever return to work? And should the same not apply to renters? And if not, why not?

This fairy story stuff about how we can accommodate everyone in an unfortunate position with regard to their mortgage isn't helpful to anyone.


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## demoivre

bugler said:


> I think it is a perfectly valid outcome for society. Anyone taking out a mortgage does so knowing it comes with certain responsibilities.



Yes people should have acted responsibly when they borrowed, just like the lenders did with their 100% mortgages, 6 and 7 times salary mortgages, 5 year fixed loans so borrowers would pass the more lenient stress tests. And the regulator and Central Bank were happy with this. 



> If you can service your mortgage, you keep your property. If you cannot  make any real effort to do so, you can't. If we want there to be any  incentive for credit-lending there has to be the ability for the lender  to repossess.


Big difference between servicing a €300 k mortgage given out in the mad times versus a €150k split mortgage. There wouldn't need to be repossessions for the most part if banks addressed long term solutions to mortgage arrears but they aren't doing so as the figures indicate.



> How long exactly should someone be allowed stay in their home without  making mortgage repayments? 1 year? 2 years? 5 years? A simple answer  please. There are a substantial number of people well over a year in  arrears. They may have very uncertain prospects of a job. How long  should they remain in the house while it is completely uncertain whether  they will ever return to work?


If banks were serious about long term solutions those solution would be decided within a year. The problem is they aren't as the figures show. I suspect that there are very very few cases where a split mortgage wouldn't suit. Most typical couples will have their children sorted out by the time the parents are in mid to late 50's. Plenty of working  time left to sort out the mortgage. For many people lump sums on retirement and inheritance are possibilities too, which could be used to reduce debt.



> And should the same not apply to renters? And if not, why not?


Rent allowance will keep them in their home if they are out of work.



> This fairy story stuff about how we can accommodate everyone in an  unfortunate position with regard to their mortgage isn't helpful to  anyone.


Neither is turfing them out on the street when they are going to have to be housed anyway.


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## Gerry Canning

Bugler; Please read what Demoivre has written . If you take Demoirves musings, Demoirvves comments make a lot of sense.

My feeling on all this, and I think we can agree, is how do we square the circle of Stupid Lending by Banks v Genuine homeowners V People chancing their arm?

My big worry is that WE have the same Bankers to sort it !!! Ugh !!!


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## bugler

Ah, I see. I had forgot one crucial component of the arrears fallacy. Namely the completely homogenous nature of those in arrears. They, of course, *all *bought in the boom. Did you know there isn't a single person in arrears who didn't buy 2005-2007? They all have massive mortgages, given to them irresponsibly. None of them bought with any type of deposit. None of them have any equity in their homes. 

Also, none of them had any responsibility in falling into arrears. It was entirely down to acts of god, or the economny falling apart. They probably all lost their job or their overtime. 

None of them remortgaged to buy an investment property, home or abroad. None of them borrowed to buy a new car, or spent large amounts of borrowed money on holidays.

*None *of these unfortunate people bear absolutely no responsibility for their circumstances.

I don't claim everyone in arrears acted irresponsibly - but the notion that they played little to no part (bar signing the contracts) is prevalent.



> If banks were serious about long term solutions those solution would be decided within a year. The problem is they aren't as the figures show.



You are sidestepping the question, unsurprisingly. How long should someone be allowed to remain in their property while making no mortgage repayments? There is a substantial number of people who have not made a payment in 1/2+ years. What is your plan for them? Reading your posts it seems like an indefinite moratorium is your solution. With a healty dose of "sure everything will probably be grand in 10 years."



> Rent allowance will keep them in their home if they are out of work.



As a renter, you would have *zero entitlement* to remain in the property if not paying the rent. You would get 14 days notice to pay rent outstanding and then 28 days to vacate. I don't believe there is any obligation on a landlord to accept RS. It is up to the landlord to decide whether they would accept it - and most do not. So as a renter, when you lose your job, or lose control of your finances, you are out of the property in short time. You would be very fortunate to have two months to make arrangements of any sort. You are also relegated to either moving in with family or relying on the state to provide accommodation in one form or another. This it seems, is good enough for the Renting Class.

Repossession is neither good nor bad. It is simply necessary. You can't have a properly functioning property market without it.


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## demoivre

bugler said:


> Ah, I see. I had forgot one crucial component of the arrears fallacy. Namely the completely homogenous nature of those in arrears. They, of course, *all *bought in the boom. Did you know there isn't a single person in arrears who didn't buy 2005-2007? They all have massive mortgages, given to them irresponsibly. None of them bought with any type of deposit. None of them have any equity in their homes.
> 
> Also, none of them had any responsibility in falling into arrears. It was entirely down to acts of god, or the economny falling apart. They probably all lost their job or their overtime.
> 
> None of them remortgaged to buy an investment property, home or abroad. None of them borrowed to buy a new car, or spent large amounts of borrowed money on holidays.
> 
> *None *of these unfortunate people bear absolutely no responsibility for their circumstances.
> 
> I don't claim everyone in arrears acted irresponsibly - but the notion that they played little to no part (bar signing the contracts) is prevalent.



Irresponsible borrowing, of which there was plenty, can only be facilitated by irresponsible lending. The irresponsible lender gets bailed out and the borrower gets offered, in the main, short term solutions such as interest only periods or payment holidays. No long term solutions for the most part as the figures show.


> You are sidestepping the question, unsurprisingly. How long should someone be allowed to remain in their property while making no mortgage repayments? There is a substantial number of people who have not made a payment in 1/2+ years. What is your plan for them?


Come to long term solutions with them such as a split mortgage. This could be done in less than a year time frame.



> Reading your posts it seems like an indefinite moratorium is your solution. With a healty dose of "sure everything will probably be grand in 10 years.


"

Never once have I suggested an indefinite moratorium as a solution in any thread. Post a link or be honourable enough to withdraw the allegation. There are numerous specific reasons as to why things might be better for people down the line as previously mentioned.





> As a renter, you would have *zero entitlement* to remain in the property if not paying the rent. You would get 14 days notice to pay rent outstanding and then 28 days to vacate. I don't believe there is any obligation on a landlord to accept RS. It is up to the landlord to decide whether they would accept it - and most do not. So as a renter, when you lose your job, or lose control of your finances, you are out of the property in short time. You would be very fortunate to have two months to make arrangements of any sort. You are also relegated to either moving in with family or relying on the state to provide accommodation in one form or another. This it seems, is good enough for the Renting Class.


The main reason a landlord doesn't want rent allowance with new tenants is because of the perception that those tenants will be trouble. It would be an entirely different proposition with an existing tenant, whose standing is good, but who has met with bad times.



> Repossession is neither good nor bad. It is simply necessary. You can't have a properly functioning property market without it.


You will have precious little of it if the banks agree long term solutions as already mentioned. Lets revisit this thread after the next set of figures are released and see how things have changed.


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## bugler

demoivre said:


> Come to long term solutions with them such as a split mortgage. This could be done in less than a year time frame.
> 
> Never once have I suggested an indefinite moratorium as a solution in any thread. Post a link or be honourable enough to withdraw the allegation. There are numerous specific reasons as to why things might be better for people down the line as previously mentioned.



What use is a split mortgage to a household without income? In the case of a borrower with no or negligible income relative to the cost of servicing their borrowings, and with no immediate prospect of an improvement in income, what is it you are advocating? 

And how long should a borrower be allowed stay in a property without paying the mortgage? You have been avoding that question throughout the thread. 

Split mortgages are not a blanket solution. And there is a "hopeful" element to them all.


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## Bronte

demoivre said:


> For many people lump sums on retirement and inheritance are possibilities too, which could be used to reduce debt.
> 
> .


 
Oh but some people want to avoid that. 

Bugler, this repossesion train, which we've been talking about for nigh on 5 years or more ain't coming to town any time soon. 

Apparently it costs 50K for a bank to reposses, it's a very very costly long drawn out affair, with anyone, but anyone who goes into court given stays of many months, many times. There was some in the Four courts this week. Adjourned so far 14 times. A loan taken out 10 years ago, 3 repayments ever, house and 2 plots of land, and got a stay of 6 months, easily done if you just show up and if you've kids, even easier. Judge very concerned about school going kids. People not in court but he still gave a stay, asked bank werre there kids, yes, 3, what ages, no idea says barrister.


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## demoivre

bugler said:


> What use is a split mortgage to a household without income? In the case of a borrower with no or negligible income relative to the cost of servicing their borrowings, and with no immediate prospect of an improvement in income, what is it you are advocating?



Long term solutions that the banks aren't interested in as previously discussed. Without any income - who has no income? The FIS guidelines for a couple with 3 kids is €703 a week. Throw a couple , with little income with 3 kids out on the street in Dublin and the rent supplement of up to €1000 per month will have be given to them paid for by the state. 



> And how long should a borrower be allowed stay in a property without paying the mortgage? You have been avoiding that question throughout the thread.



Twice already in the thread I have said less than a year which is a reasonable time frame.



> Split mortgages are not a blanket solution. And there is a "hopeful" element to them all.



Never said they were. Neither is repossession.

Have you found a thread yet where I advocated an indefinite moratorium on mortgage repayments? Not honourable enough to withdraw the claim?


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## bugler

demoivre said:


> Long term solutions that the banks aren't interested in as previously discussed. Without any income - who has no income? The FIS guidelines for a couple with 3 kids is €703 a week. Throw a couple , with little income with 3 kids out on the street in Dublin and the rent supplement of up to €1000 per month will have be given to them paid for by the state.
> 
> 
> Twice already in the thread I have said less than a year which is a reasonable time frame.
> 
> 
> Have you found a thread yet where I advocated an indefinite moratorium on mortgage repayments? Not honourable enough to withdraw the claim?



The unemployed have no income. MIS is meant to be a short term support.
What long term solution is there for those without an income, or anything approaching an adequate income? They form a significant part of the arrears problem. Wait until they get an income? You keep mentioning "long-term solutions" - do you mean split mortgages? What would you call a split mortgage toward which the borrower isn't able to contribute?

At least with applicants for RS there is a requirement that the property be appropriate for their needs.

If you believe someone unable to pay their mortgage should not remain in situ for more than 1 year then perhaps we finally have something to agree on - though 12 months seems quite a long time. 

If you read back what I initially wrote ("Reading your posts it seems like an indefinite moratorium is your solution.") It is far from clear to me that that is unreasonable. Pay what you can when you can, and things will most likely improve in time.



> Bugler, this repossesion train, which we've been talking about for nigh on 5 years or more ain't coming to town any time soon.



It has to. Because people who are not compelled to pay their debts do not pay their debts. Debts are not paid out of duty, or morality. I am not sure I take the 50k figure at face value, though I can see how the costs rack up given a lengthly case. Besides, there are banks who have taken many repossession cases and over relatively modest properties. It was worth it to them. Presumably the 6 specialist judges appointed in the line of the insolvency process will handle some of these cases.

But the main purpose of repossession is that of a deterrent. Marginal cases may need to see that the threat of legal action is real in order to make the decision to make their repayments. It is far better for a bank to organise a voluntary surrender, of course. 

Seeing this has now been split into its own thread I believe I should sum up my own opinion. 

1. Where a realistic solution that keeps people in their property can be made it makes sense to do so, for the bank as much as the borrower. However, realistic solutions are not effectively forebearance measures. And I note from the CB statistics that a significant minority of restructured agreements are not kept to, even in the relative short-term.

2. It is not a positive outcome for people who cannot or will not make repayments on their mortgages to retain their properties for anything over 4-6 months. Even ignoring the state-owned banks angle, forcing costs on banks is to the detriment of banking customers generally. It is likely to mean increased costs elsewhere, and a lack of competition. Tesco declined to enter the Irish lending market, and I can see why.

3. There is an oversimplified attitude to those in arrears from the public, media and political representatives. There is an assumed homogenity (they are presumed to have bought in the boom and are in severe negative equity). They are typically and unquestioningly painted as victims of circumstance. Most people, and particularly media and political figures, are terrified of stating what is obvious - *some *of those in arrears are there because they have made very poor financial decisions, or have let their spending spiral out of control, lived beyond their means, failed to balance the books etc etc. There are enormous levels of personal debt run up outside mortgages that indicate this.

4. I don't think the full extent of the arrears problem is yet acknowledged. To be honest, I don't think the banks/CB statistics tell the full story. I think it is worse than stated, and I think this is a natural result of a "no repossession" policy adopted by the banks and government over a number of years. 

Eventual this has to be tackled and repossession has its natural part to play.


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## Gerry Canning

Bugler; I don,t think anyone disagrees that Repossession has a natural part to play.

Given the Stupendous size of the problem .
Given the False priming by Banks.
Given (commit suicide) on any naysayer.
Given most people believed Banks that all is upward and onward.
Given the sad reality of job losses.
Given the 64 Billion , you and I were conned of and went to Banks.
Given these people are my good neighbours.
Given most are genuine.
Given we Capitalized Banks to take losses.
Given their self-serving holding of this capital 
Given that a Hard Repo would completely wreck our economy.

I now contend that Banks inactivity has AGAIN left them winning and us Idiots asking Questions.

I agrred with you at the top of this thread and agree at the end (eventually this has to be tackled)

Sermon over!!!
Regards Salmon.


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## gaius

demoivre said:


> They are not valid outcomes for society or the person who wants to stay in their home imo. Most unsustainable mortgages could be made sustainable by a split mortgage. The fact is banks aren't playing ball as indicated by the fact that only 144 splits have been agreed out of 142,000 arrears cases, even though the CB wants banks to introduce more long term arrangements with people in arrears.


 Split mortgages are not a solution. They are a can kicking exercise and can kicking exercises are a large part of the reason why we are in the position we're in today.


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## AlbacoreA

demoivre said:


> ...The main reason a landlord doesn't want rent allowance with new tenants is because of the perception that those tenants will be trouble. It would be an entirely different proposition with an existing tenant, whose standing is good, but who has met with bad times....



Part of the problem, perhaps the major part of it, is the system is not attractive for a landlord. The landlord has very little protection against loss and damages or overholding. Its paid in arrear, and often tenants don't pay a deposit from their own money.


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## AlbacoreA

gaius said:


> Split mortgages are not a solution. They are a can kicking exercise and can kicking exercises are a large part of the reason why we are in the position we're in today.



Which is more useful to the economy/Govt. Keeping people in their own houses or paying them to be repossessed, and end up paying for them in rental accommodation. The loses incurred by the bank, end up being borne by the govt in the long run. It makes it more attractive for people to default and even emigrate, than staying with their own house. Which narrows the tax base yet further. Kinda eating your own tail no? Is it not better to keep people in their own homes which they will maintain, rather than to leave them empty and for them to fall into disrepair and devalue them even further. That said if the govt pays the rent it should gain some equity in the property.


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## dub_nerd

Could the people who keep on saying "we'll have to pay to accommodate people anyway after we make them homeless" _please_ provide some statistics on how many of those with unsustainable mortgages cannot afford _any_ kind of rental accommodation. Or is there any special reason why someone who cannot afford to pay for the house they bought should get to keep it, while those looking to enter the market stay priced out of it because of the lack of sales?

Let's try the following thought experiment. Since the banks have to do something about mortgages which aren't getting paid, how about the government pays the mortgage for anyone who for whatever reason isn't paying it themselves? Like you say, we have to pay for them somehow anyway. Now how does it feel paying the mortgages of people who can't afford their houses, while those unlucky enough not to have bought overpriced accommodation get nothing? Because that is in effect what's happening right now.


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## Protocol

dub_nerd said:


> Could the people who keep on saying "we'll have to pay to accommodate people anyway after we make them homeless" _please_ provide some statistics on how many of those with unsustainable mortgages cannot afford _any_ kind of rental accommodation.


 
Yes.

Example: unsustainable mortgage, too high, at 1500 pm, on huge debt.  Can't afford it.

But can afford 750pm rent on similar or smaller house nearby.

Not homeless, not dependent on the State.


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## AlbacoreA

You reckon people will downsize and pay off the balance of the mortgage debt they'll be left with, for the next 20yrs because the bank won't write it off.

Instead of emigrating and leave the state to pay it instead. Which will be in taxes on the person who's buying now. 

If you think buying the house is the hard part now. You may have to rethink that as they bring in every charge and tax known to man and the easy target is the property owner who can't liquidate and move rapidly.


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## Delboy

AlbacoreA said:


> You reckon people will downsize and pay off the balance of the mortgage debt they'll be left with, for the next 20yrs because the bank won't write it off.
> 
> Instead of emigrating and leave the state to pay it instead. Which will be in taxes on the person who's buying now.
> 
> If you think buying the house is the hard part now. You may have to rethink that as they bring in every charge and tax known to man and the easy target is the property owner who can't liquidate and move rapidly.



I'll take my chances on possible higher taxes at some possible time in the future if it means repossessions finally get started in this country.

Do you all really think if people are allowed to stay on in their now unaffordable houses (even the very large % that can afford to pay but are now refusing to, and this cohort appears to be growing as word spreads), that this won't mushroom into a much bigger problem than having to pay for the housing of a % of those that will be repossessed?

As Dub_Nerd said...not everyone who will be repossessed will be in need of social housing.

Bring it on and gets this housing mess sorted for once and for all


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## dub_nerd

+1. There will have to be debt writedowns for people who genuinely can't pay. That's unavoidable and that _is_ something we're going to have to pay for. But the decision as to what a person can or can't pay should properly be the result of a legal process, and the person who benefits from a debt write-off cannot retain the asset. 

Btw, charges and taxes resulting from new bank losses will pale into insignificance compared to the ones that will be needed to pay for the billion a month that we're overspending at the moment.


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## AlbacoreA

Whats their incentive to say and contribute, if you leave them with a large debt after the write down and kick them out of their home which they may have already put large sums into. Ok they can't retain the asset, but some equity in it would be a carrot to stay. Otherwise, they start building a war fund, to travel with. Which is what I assume they are doing.


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## AlbacoreA

Delboy said:


> I'll take my chances on possible higher taxes at some possible time in the future if it means repossessions finally get started in this country....



Its a certainty and not some distant future either. Its here now. 

Will flood of repossessions really help. In the US theres been suggestions that principal reduction vs foreclosure is a much less of a hit on the tax payer and thus the economy.


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## Delboy

AlbacoreA said:


> Its a certainty and not some distant future either. Its here now.
> 
> Will flood of repossessions really help. In the US theres been suggestions that principal reduction vs foreclosure is a much less of a hit on the tax payer and thus the economy.



This is Ireland....it should be a certainty that they will start but I have a fear it'll be a fudge and the mess carried on far into the future.
So until I see repossession rates running at a few hundred a month, initially at least, I won't believe it


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## AlbacoreA

So what this is Ireland. Its the idea that Ireland is somehow "different" got us to this point.


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## Delboy

AlbacoreA said:


> So what this is Ireland. Its the idea that Ireland is somehow "different" got us to this point.



That's the point I was making! We are'nt different but we are certainly acting that way with the practically non-existent level of repossessions we currently have


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## dub_nerd

AlbacoreA said:


> Whats their incentive to say and contribute, if you leave them with a large debt after the write down and kick them out of their home which they may have already put large sums into. Ok they can't retain the asset, but some equity in it would be a carrot to stay. Otherwise, they start building a war fund, to travel with. Which is what I assume they are doing.


 
If they leave the country we don't have to pay rent for them. As I said, writing down or writing off the debt will be appropriate in some cases, not in others. There isn't, and shouldn't be, a blanket solution. It's in the bank's interest to work with the customer to find a solution that involves keeping the house. That way the bank doesn't have to book losses now, which it does in the case of a repossession and firesale, and that looks better on the bank's balance sheet. The only thing to be avoided is the bank using the same rationale to "extend and pretend" as they have been doing, where the mortgage is unsustainable. In that case, a resolution is needed and in some cases it must involve repossession.

The other reason why repossessions need to start is because of the moral hazard of strategic defaulting. Anyone with their wits about them knows this is a factor. Look at Ulster Banks investor statement the other day, look at the Allsop auction "protestors" yesterday, look at numerous threads on askaboutmoney.com about how to avoid paying mortgages even where affordable, or seeking mortgage "deals". I'm as critical of the banks as the next man, but it doesn't mean I fancy paying his mortgage.


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## AlbacoreA

if the mortgage is unsustainable is paying for it not unavoidable. either as a loss to the bank if they default. or in some form of write down or assistance payment. the govt pays either way.


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## Gerry Canning

Not in disagreement with Dub nerd on a lot of points.
The MAIN issue is how we Mr Citizen get out of this mess @ least cost ?
........................................................................................
Of course Ulster Bank statement said 35% strategic defaulters. I can,t see 35%. Since when were Banks truthful? I know there is some % of chanchers.
The Allsops (protest) is a sad manifestation of the potential civil disturbances we may have if Government permit Banks to keep driving in an erratic manner.
I have carefully read the NOT Wanting to pay brigade. I don,t read most posts as NOT wanting to pay ,but a sad desperation of the hole they are in.

A long time ago I was taken with the proposition that people repay 35% of disposable income on troubled mortgages . 
Could that not be a starting point , and would it not give the genuine, some breathing space and would it not ,flush out the chanchers.?


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## jman0war

salmon9077 said:


> Bugler; I don,t think anyone disagrees that Repossession has a natural part to play.
> 
> Given the Stupendous size of the problem .
> Given the False priming by Banks.
> Given (commit suicide) on any naysayer.
> Given most people believed Banks that all is upward and onward.
> Given the sad reality of job losses.
> Given the 64 Billion , you and I were conned of and went to Banks.
> Given these people are my good neighbours.
> Given most are genuine.
> Given we Capitalized Banks to take losses.
> Given their self-serving holding of this capital
> *Given that a Hard Repo would completely wreck our economy.*


 
 How would repossessions wreck our economy?
Those properties would become available for others to take.
Instead of young couples building savings, they might be able to buy instead.
Property values would decrease, bringing more people into the market.


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## Gerry Canning

I agree Repos would free up properties.
I agree young couples might buy.
I agree property values would decrease.

..............................................
If a LOT of Repo,d property floods the market , prices will fall well-shy of their real value.And  Since WE own these and the Debt on them , by selling at a very low cost ,we taxpayers take another hit. We can see this happening  in the Commercial Property Market , funds are buying in cheaply , we will take the hit on these comercial mortgages. Cash rich VULTURE FUNDS would love to buy our houses in a fire sale. 
When things stabilise(and they will) properties can be sold at a reasonable value.

If we could keep Repo sales within our population eg the young couples ,I can see merit in your comments.
I have NO DOUBT that if there are a lot of Repos that the large purchasers will be the 2013 equivalent of the Carpet Baggers !!


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## AlbacoreA

jman0war said:


> How would repossessions wreck our economy?
> Those properties would become available for others to take.
> Instead of young couples building savings, they might be able to buy instead.
> Property values would decrease, bringing more people into the market.



I have a hunch a lot of them will be in areas/or properties that people won't want to move to, rather than desirable areas or properties. Only my guess. Also these are effectively a further loss to the bank they will become even less willing to give out loans, or facilitate people buying. It may actually make it harder Unless you are a cash buyer who can buy to speculate.


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## dub_nerd

salmon9077 said:


> Not in disagreement with Dub nerd on a lot of points.
> The MAIN issue is how we Mr Citizen get out of this mess @ least cost ?
> ........................................................................................
> Of course Ulster Bank statement said 35% strategic defaulters. I can,t see 35%. Since when were Banks truthful? I know there is some % of chanchers.
> The Allsops (protest) is a sad manifestation of the potential civil disturbances we may have if Government permit Banks to keep driving in an erratic manner.
> I have carefully read the NOT Wanting to pay brigade. I don,t read most posts as NOT wanting to pay ,but a sad desperation of the hole they are in.
> 
> A long time ago I was taken with the proposition that people repay 35% of disposable income on troubled mortgages .
> Could that not be a starting point , and would it not give the genuine, some breathing space and would it not ,flush out the chanchers.?


 
Just to note -- the Ulster Bank chief risk officer said that 35% of mortgage holders in arrears over 90 days were paying zero toward the mortgage. Anyone who has lost their job and is living on welfare with no other household income is hardly able to contribute more than zero, so strategic defaulting is probably a small minority. Nevertheless, if you make repossessions impossible and give the impression that all those claiming difficulty in paying will get a write-down, then you create a strong incentive to pay less than you're able to.


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## dub_nerd

salmon9077 said:


> I agree Repos would free up properties.
> I agree young couples might buy.
> I agree property values would decrease.
> 
> ..............................................
> If a LOT of Repo,d property floods the market , prices will fall well-shy of their real value.And Since WE own these and the Debt on them , by selling at a very low cost ,we taxpayers take another hit. We can see this happening in the Commercial Property Market , funds are buying in cheaply , we will take the hit on these comercial mortgages. Cash rich VULTURE FUNDS would love to buy our houses in a fire sale.
> When things stabilise(and they will) properties can be sold at a reasonable value.
> 
> If we could keep Repo sales within our population eg the young couples ,I can see merit in your comments.
> I have NO DOUBT that if there are a lot of Repos that the large purchasers will be the 2013 equivalent of the Carpet Baggers !!


 
You're basically arguing for interference in the housing market to make sure prices don't fall below what you are arbitrarily calling their "real" value, and that sales should be restricted to certain people with investors excluded. That sort of strategy has got us in the mess we are in, with credit completely frozen up and no sign of an improvement after five years. Remember the NAMA concept of "long term economic value", how property only had to "recover" by 10% in 10 years for them to break even? What is it, a 30-40% _decrease_ since then? We're going to take another hit on the banks, and NAMA is going to lose its shirt. That's a given, so we might as well get there as quick as possible.


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## Gerry Canning

Dub nerd;
I am only arguing about what might be better for Ireland. Fire or Repo sales seem to me a sure fire case of re-catching the Taxpayer again. 
Given the potential pent-up Repo demand , if that happened to quote you {as quick as possible} I would fear a complete melt down and not just in money terms. I would fear that the Social Implications would tear Ireland apart.
Just to be clear , I also accept this issue needs sorting but I don,t think a bonfire is the answer , bonfires create only ashes !!

Maybe the answer is start with buy to lets and review ?
Regards, Salmon.


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## dub_nerd

Salmon, don't the new codes allow for the mortgage holder to be able to sell the house themselves? So we don't have to be talking about fire or repo sales in the sense of the bank accepting a fraction of what the owner would have got for the same property.


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## jman0war

I've been browsing estate agents and real estate websites in USA.
There are tons and tons of foreclosed houses for sale.
I believe this has always been the case there.
It is a necessary and normal function within a property market.

Is anybody making the case that foreclosed houses = destroyed economy?


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## jman0war

salmon9077 said:


> Dub nerd;
> I am only arguing about what might be better for Ireland.


I don't think so.
You are using emotive terms like "VULTURE FUNDS", as though we should be afraid.

We are talking about taking currently non-performing assets and flipping them so they become performing assets, generating economic activity.

Whether it's young couples or "VULTURE FUNDS", makes zero difference.


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## gaius

jman0war said:


> I've been browsing estate agents and real estate websites in USA.
> There are tons and tons of foreclosed houses for sale.
> I believe this has always been the case there.
> It is a necessary and normal function within a property market.
> 
> Is anybody making the case that foreclosed houses = destroyed economy?



It's as lazy as the argument that not guaranteeing Anglo-Irish would have stopped ATM's running, even though Anglo-Irish didn't actually have any ATM's.


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## Gerbo

Wish I was you. Never made a mistake in your life.
Many people made what ate now obvious errors of judgement in mortgage. Then lost job and now facing eviction and/or emmigration.
Where is your compassion?


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## gaius

Gerbo said:


> Wish I was you. Never made a mistake in your life.
> Many people made what ate now obvious errors of judgement in mortgage. Then lost job and now facing eviction and/or emmigration.
> Where is your compassion?


 Where is your compassion for those who carefully avoided risk and are now being scolded for not jumping into the boiling hot water too?
i.e. drop the appeal to emotion please and try to base your argument on something approaching sense.

P.S. You know nothing of my personal circumstances. For all you know, I might be the proud owner of a neg equity shoebox but I'm keeping up the repayments and not attempting to pull strokes to get somebody else to pay it for me.


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## Gerbo

In your world we would still gave hanging and deportation for petty crime.
I know that some people are what they call strategic defaulters but in my experience most are genuine. One could say that a young couple were foolish to take out s mortgage based on both earning and never anticipated job loss for one or even worse for both.
I don't know of a good solution but I do know eviction is bad for society as a whole. All it will do is a) drive some to suicide and b) will end up costing more in the long run as whether you like it or not we are a social democracy aiming to help ALL our citizens, not just those wise virgins who kept oil for their lamps.


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## Jim2007

Gerbo said:


> a social democracy



Since when??? I must have missed that one!


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## Gerbo

I know what u mean, but at least that's he theory.


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## Delboy

So if a bank repossesses, they may soon have no outlet to sell the property

http://www.independent.ie/irish-new...event-unnecessary-repossessions-29580169.html


> Asked if the IMHO would seek a similar agreement from other estate agents and auctioneers, Mr Hall said: "We will be seeking an identical commitment from every single auctioneer throughout the country. We will be saying clearly that sales of repossessed family homes will only take place where everyone agrees that the property must be sold. It can only be done in our view when a deal has been done on the entire debt by consent. Only then can it be sold. We want the entire deal to be triggered at the moment the property is sold when it is done by agreement."



Whats people's view on this?
Surely there's a anti-competitiveness angle to this, especially if say all the other EA's signed similar agreements.
Why would anyone possibly consider paying their mortgage on their PPR if this new agreement works....you just have to say you don't want to leave your PPR, and your untouchable.
And this only makes more problems for the banks, possibly leading to more funding being needed (as it's clearly debt forgiveness that Hall is alluding to above)....so all will pay to keep the minority in their unaffordable houses or give them 100% clean slates if they walk away.
And do Buy to Lets fall into this?

Another sad day in the banama republic


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