# 68 year old gets PIA involving tracker rate for life



## Brendan Burgess (20 Oct 2021)

Debt ruling allows Waterford man pay €93 mortgage per month
					

Court decision slashing mortgage payments may be solution for Celtic Tiger-era debts




					www.irishtimes.com
				




He retired in February 2020 and has been relying on the State pension for income. Mr O’Regan’s house was valued at €210,000 and there was €97,000 remaining on his mortgage.

Under the arrangement approved by Judge Mary Enright, Mr O’Regan will be allowed to remain in the house for his lifetime on the reduced mortgage repayments until he is 98.

His new monthly repayments will be set on a tracker mortgage for his lifetime.


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## Brendan Burgess (20 Oct 2021)

This is absolutely crazy and explains why other borrowers are paying the highest mortgage rates in the EU. 

Fully agree that he should have got an interest-only mortgage for life, but it should have been at market rates or maybe even above market rates. 

If he were to get a life loan it would have been at 5%.  So either a variable rate of 3% or a rate fixed for 20 years of 4% would be appropriate.

Brendan


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## NoRegretsCoyote (20 Oct 2021)

Brendan Burgess said:


> His new monthly repayments will be set on a tracker mortgage for his lifetime.


The article doesn't make clear, but it is an *interest only *tracker mortgage.

A contributory state pension is about €1100 a month. €93 a month is not very much compared to his income and his heirs will still get an inheritance as the debt won't grow.

He would probably pay a bit more as a share of income on a local authority differential rent scheme......


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## Steven Barrett (20 Oct 2021)

> In July, the Central Bank called on lenders to be more “extensive or ambitious” in finding solutions for *more than 29,000 people in long-term mortgages arrears*. The bank said that a quarter of borrowers in this category were aged over 60.



This is the most shocking bit, there is almost 30,000 people still in long term arrears. I am presuming most of them are from a situation that arose 13/14 years ago. They should have been sorted by now. In some cases, people are clinging onto properties that they can never afford to pay off. In others, people simply haven't heard back from the banks and are unable to move on with their lives with this hanging over them.


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## deanpark (20 Oct 2021)

Brendan Burgess said:


> This is absolutely crazy and explains why other borrowers are paying the highest mortgage rates in the EU.
> 
> Fully agree that he should have got an interest-only mortgage for life, but it should have been at market rates or maybe even above market rates.
> 
> ...


Ulster Bank won't miss the money. The chap will be glad he had a nice judge on the day.


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## Brendan Burgess (20 Oct 2021)

Yes, but ordinary borrowers have to pay for it. 

Brendan


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## deanpark (20 Oct 2021)

Well maybe (some of) those borrowers are glad that a bloke like this and others get to stay in their homes. Not just a financial matter. And banks are hardly models of financial probity are they given their abysmal track record in recent decades of wasting money on daft ventures and not being run properly.


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## ClubMan (20 Oct 2021)

Unless it's a one bed house, shouldn't something like rent a room have been considered in order to generate additional income to service the loan? Although, as pointed out above, €93 p.m. is probably already only a marginal chunk of the existing pension income? But maybe he's not on a full pension or something?


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## Brendan Burgess (20 Oct 2021)

The repayment is less relevant here. 

But he should be charged the full market rate interest which would be about 4% . 

It's crazy that he is given a low interest rate loan for life.

Brendan


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## noproblem (20 Oct 2021)

I'm from the old school, and if you couldn't afford something you did without it. To me, all this reneging on debt is just encouraging others to not pay what they owe. Why would anyone pay back what they borrow if this is the end result? Farcical in my opinion, and I well understand that others who don't like paying their debts think i'm wrong.


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## ClubMan (20 Oct 2021)

NoRegretsCoyote said:


> The article doesn't make clear, but it is an *interest only *tracker mortgage.
> 
> A contributory state pension is about €1100 a month. €93 a month is not very much compared to his income and his heirs will still get an inheritance as the debt won't grow.


What he is deemed to be able to afford is probably driven, at least in part, by the ISI's reasonable living expenses (RLE) calculator.





						Reasonable Living Expenses Calculator - Back on Track
					






					backontrack.ie
				



In this example - assuming a single person, no dependents, no car and €93 mortgage costs per month - the calculator comes up with an RLE figure of €1,031.


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## Laughahalla (20 Oct 2021)

Hypothetical Q. Put aside the wrongs(and silliness) of it for a minute ..
If *everybody *in the country decided to stop paying their mortgage from today onwards. What would happen?


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## noproblem (20 Oct 2021)

Laughahalla said:


> Hypothetical Q. Put aside the wrongs of it for a minute ..
> If *everybody *in the country decided to stop paying their mortgage from today onwards. What would happen?


For one thing, there would be an immediate shortage of housing, a lot of angry people, and a stupid general election that some me me me people think would solve everything


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## Steven Barrett (21 Oct 2021)

noproblem said:


> I'm from the old school, and if you couldn't afford something you did without it. To me, all this reneging on debt is just encouraging others to not pay what they owe. Why would anyone pay back what they borrow if this is the end result? Farcical in my opinion, and I well understand that others who don't like paying their debts think i'm wrong.


Which is why the central bank restrictions on borrowing should remain in place. The levels of borrowing during the Celtic Tiger was crazy. All these people funding their lifestyles through equity release on their homes. Owning multiple properties with no money down, all equity release and 100% mortgages. Everything reliant on property prices going up forever. I have seen a case where an underwriter gave the loan on the assumption that 2 of the 3 bedrooms were rented for the 35 years of the mortgage. The person who got the mortgage is now married with children, so of course the 2 rooms aren't rented out. The banks have to share some of the blame for this. 


Steven
www.bluewaterfp.ie


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## NoRegretsCoyote (21 Oct 2021)

Brendan Burgess said:


> But he should be charged the full market rate interest which would be about 4% .
> 
> It's crazy that he is given a low interest rate loan for life.


I tend to agree. An open-ended interest-only tracker like this is very expensive in terms of capital for the bank. Paid for by other borrowers of course.

A fairer solution would see a higher interest rate and a commitment never to repossess . 

If his kids want an inheritance they could help him pay down the capital.


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## deanpark (21 Oct 2021)

Steven Barrett said:


> Which is why the central bank restrictions on borrowing should remain in place. The levels of borrowing during the Celtic Tiger was crazy. All these people funding their lifestyles through equity release on their homes. Owning multiple properties with no money down, all equity release and 100% mortgages. Everything reliant on property prices going up forever. I have seen a case where an underwriter gave the loan on the assumption that 2 of the 3 bedrooms were rented for the 35 years of the mortgage. The person who got the mortgage is now married with children, so of course the 2 rooms aren't rented out. The banks have to share some of the blame for this.
> 
> 
> Steven
> www.bluewaterfp.ie


I agree the banks have to share some of the blame. When they took the country to the brink and beyond of bankruptcy, when they duped 40,000 people off their trackers, when they repossessed houses and BTLs they had no right to do under the tracker scandal - in my view the banks then lost the legitimacy they had and if they have to carry extra capital now then it's their mistakes that have led in large part to this. Ordinary punters in genuine difficulties or trying it on are going to act selfishly via the courts and why wouldn't they if they see banks doing it.


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## noproblem (21 Oct 2021)

NoRegretsCoyote said:


> If his kids want an inheritance they could help him pay down the capital.


Why would they with deals like this?


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## JD2021 (21 Oct 2021)

I read this story yesterday , there's been others recently whilst not similar ultimately the results the same. I noticed the Bank objected to the PIA but the Judge approved. I'm getting a sense there will more and more of these arrangements. 

Obviously I don't know the full circumstances but having a €97,000 mortgage balance on retirement and indeed quite a high monthly repayment on retirement was surprising. 

I'm going to be Blunt and come at this from a different angle,  some  here will know, I have a separate thread re my attempts to deal with relatively small arrears and mortgage balance, my case has a medical aspect, reduced earnings etc. I've literally bent over backwards, got some personal  financial support , have cleared 80% of arrears, have been paying full mortgage for over 2 years and Mortgage protection separately and I can say without fear of contradiction the behaviour of the VF I'm dealing with is beyond shocking,  even Mabs (brilliant), exasperated. I've no problem naming the VF, Start who purchased my mortgage from PTSB in 2019.

A litany of mistakes, lost paperwork, incorrect APR being charged, Zero response to queries and a major Cock up re mortgage protection policy expiration date (that was the fault of PTSB) these but a few extraordinary things that came to light during the process of seeking documentation. 

I certainly don't expect special treatment,  not looking for reduced interest rates but at a minimum expect fairness and a willingness to actually engage, the very concept those in arrears are accused of not doing, its just astonishing what I've experienced over the past 3 months, which actually started as a result of an incorrect demand for full payment of my mortgage balance when an arrangement was in place and being adhered too.

I'm at a stage were I've given up dealing with this nonsense,  I'll continue paying my mortgage and address miniscule arrears when I can, they can quite frankly do what they like at this stage and honestly  , I'd relish a day in court. 

I'm not for a minute suggesting there are those acting the maggot , but I'm certainly not one, I heard reporting last week of 122 repossession cases up before a local circuit court, some genuine hardship cases, some beggars belief.


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## DublinHead54 (21 Oct 2021)

Steven Barrett said:


> This is the most shocking bit, there is almost 30,000 people still in long term arrears. I am presuming most of them are from a situation that arose 13/14 years ago. They should have been sorted by now. In some cases, people are clinging onto properties that they can never afford to pay off. In others, people simply haven't heard back from the banks and are unable to move on with their lives with this hanging over them.



Banks are literally paying to sweep this under the carpet.



			Bank of Ireland moves to improve CET1 capital ratio


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## Baby boomer (21 Oct 2021)

NoRegretsCoyote said:


> I tend to agree. An open-ended interest-only tracker like this is very expensive in terms of capital for the bank. Paid for by other borrowers of course.


Why is it so bad for the bank?  And if it is, why aren't they offering me a hefty discount to buy out my 1% interest only tracker taken out in 2005?


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## NoRegretsCoyote (21 Oct 2021)

Baby boomer said:


> Why is it so bad for the bank?


Because they have regulatory obligations to hold a lot of expensive capital for this kind of asset. There is risk of re-default, and they have to hold it for an indefinite period before being able to realise the principal. 1% or whatever he is on is far below what it costs the bank to maintain the loan.



Baby boomer said:


> And if it is, why aren't they offering me a hefty discount to buy out my 1% interest only tracker taken out in 2005?


Because you can afford to pay it back to them


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## Baby boomer (21 Oct 2021)

NoRegretsCoyote said:


> Because they have regulatory obligations to hold a lot of expensive capital for this kind of asset. There is risk of re-default, and they have to hold it for an indefinite period before being able to realise the principal. 1% or whatever he is on is far below what it costs the bank to maintain the loan.
> 
> 
> Because you can afford to pay it back to them


Me and the guy from the case are both paying 1%.  Presumably, he can afford that!  If the 1% really is far below what it costs the bank to maintain the loan, they should be offering me a deal.  They're not, so I suspect the loan is still profitable, even at that interest rate.


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## NoRegretsCoyote (21 Oct 2021)

@Baby boomer

Do you have a tracker for life like this guy? I suspect not!

Something can be "profitable" in the sense that  interest payments exceed the bank's funding costs. The issue is the regulatory capital associated with this kind of loan (which is not cheap).


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## ClubMan (21 Oct 2021)

Repaying a mortgage into your 90s one option to fix arrears, says Central Bank
					

Deputy governor urges lenders to ‘think more imaginatively’ to resolve Celtic Tiger-era debt cases




					www.irishtimes.com


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## Baby boomer (21 Oct 2021)

NoRegretsCoyote said:


> @Baby boomer
> 
> Do you have a tracker for life like this guy? I suspect not!
> 
> Something can be "profitable" in the sense that  interest payments exceed the bank's funding costs. The issue is the regulatory capital associated with this kind of loan (which is not cheap).


Yeah, I get that.  But, again, if regulatory capital is so onerous for the bank, wouldn't they be offering to buy me out?  Then they could lend out that capital to another borrower at current (semi-monopolistic) market rates.


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## DublinHead54 (21 Oct 2021)

NoRegretsCoyote said:


> Because they have regulatory obligations to hold a lot of expensive capital for this kind of asset. There is risk of re-default, and they have to hold it for an indefinite period before being able to realise the principal. 1% or whatever he is on is far below what it costs the bank to maintain the loan.



The link I posted to the RTE article addresses how BOI of Ireland are working around the expensive capital requirements. 

Instead of trying to resolve the underlying issue, they have passed the risk of default onto another entity, in this case pension funds are amongst the purchasers. BOI are paying the pension fund to take the risk. This is a common activity in banks known as credit risk mitigation, it's essentially insurance and works to reduce the riskiness of the balance sheet without shedding the assets/liabilities whilst reducing capital requirements. 

In practice if the bulk of the underlying mortgages default the purchasers will pay out the equivalent back to BOI


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## DublinHead54 (21 Oct 2021)

Baby boomer said:


> Yeah, I get that.  But, again, if regulatory capital is so onerous for the bank, wouldn't they be offering to buy me out?  Then they could lend out that capital to another borrower at current (semi-monopolistic) market rates.


The people managing the Regulatory capital are operating at a portfolio level and not an individual mortgage account level. It is cheaper in their eyes to do a bulk credit risk mitigation deal (link posted earlier) than solve at the individual account level.


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## NoRegretsCoyote (21 Oct 2021)

Dublinbay12 said:


> The link I posted to the RTE article addresses how BOI of Ireland are working around the expensive capital requirements.


I get the concept 

It's cheaper than holding capital I presume but still a lot more expensive than a fully performing portfolio.



Dublinbay12 said:


> The people managing the Regulatory capital are operating at a portfolio level and not an individual mortgage account level.


This is an important point. Individual deals are very labour intensive for the bank. 

There is also the adverse selection problem - if you can afford to make a deal then you can afford to make your contractual interest payments too!


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## time to plan (30 Oct 2021)

Brendan Burgess said:


> This is absolutely crazy and explains why other borrowers are paying the highest mortgage rates in the EU.


To be a bit picky, you probably mean the Eurozone, and even then I believe Greece and Malta are higher.


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## Brendan Burgess (30 Oct 2021)

Thanks I do mean the eurozone. 

And we have been pretty consistently the highest for some time, with occasionally being relegated to second or third place.

Brendan


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## Sarenco (30 Oct 2021)

When you factor in cashbacks and the extra fee income that most European banks generate through set-up and administration fees, Irish mortgage rates on new home loans, although still high, are much closer to the Eurozone average than the headline figures suggest.

And when you include trackers on exiting home loans, Irish mortgage rates overall are pretty much bang in line with the Eurozone average.

I think that's pretty incredible when you consider all the difficulties with enforcing security in Ireland.


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## NoRegretsCoyote (30 Oct 2021)

Sarenco said:


> *When you factor in cashbacks and the extra fee income that most European banks generate through set-up and administration fees,* Irish mortgage rates on new home loans, although still high, are much closer to the Eurozone average than the headline figures suggest.


Am aware that most EU banks can charge one-off origination fees (usually loaned upfront) and ongoing fees on mortgage accounts.

But enough to close most of the gap?

Take for example a 300k mortgage over 25 years. In Ireland at 2.5% it's €105k in total interest. In the Netherlands at 1.5% it's €60k in total interest, or a €45k difference over the life of the mortgage.

I don't think origination fees (let's be generous and say €8k) and ongoing charges (again a generous €25 a month) will eat much into the benefit of being able to borrow 100bp lower.


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## ClubMan (23 Jun 2022)

Appeal can proceed against insolvency plan that allows man to pay €93 towards mortgage each month
					

Judge says it was ‘misconceived’ to argue the issues between the parties had become moot




					www.irishtimes.com


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## Paul O Mahoney (23 Jun 2022)

Laughahalla said:


> Hypothetical Q. Put aside the wrongs(and silliness) of it for a minute ..
> If *everybody *in the country decided to stop paying their mortgage from today onwards. What would happen?


That would be so fun....I say that having spent the day talking to the bank about a hack on our account.  They couldn't care less, as " the fraud department  controlled the situation ".


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## Paul O Mahoney (23 Jun 2022)

The person in question doesn't have means the property is valued more than the outstanding loan , where is the issue here.

Make him homeless and it'll cost more than €93 a month and to find him alternative accommodation the €93 will need to be increased factor of 10. 

The bank isn't going to lose a dime on this,  the taxpayer will however save a considerable amount of money.


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## skrooge (23 Jun 2022)

Paul O Mahoney said:


> The person in question doesn't have means the property is valued more than the outstanding loan , where is the issue here.


He's illiquid but not insolvent. There is equity of €100k in his property. The bank could argue that based on average rents in Waterford that could cover close to a decade of renting. 



Paul O Mahoney said:


> The bank isn't going to lose a dime on this,  the taxpayer will however save a considerable amount of money.


Except it does cost the bank. The bank expected €100k plus interest over the next 5 years instead it's been offered €33k spread over 30 years. 

The taxpayer only saves if they don't have a loan/current account with the bank. Otherwise that taxpayer is footing the bill through higher interest rates or bank charges. 

It's not the banks job to provide social housing.


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## NoRegretsCoyote (23 Jun 2022)

skrooge said:


> He's illiquid but not insolvent. There is equity of €100k in his property. The bank could argue that based on average rents in Waterford that could cover close to a decade of renting.


His net wealth is €100k if he sold the house, no more income than a state pension, and has nowhere to live.

He's not insolvent but has a housing need. Leaving him in his house with no fear of eviction will see him maintain the house so the bank can maximise value in due course.

I believe these kind of solutions are best for retired people on low incomes as otherwise the state pays via social housing, and at a much higher cost.


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## skrooge (23 Jun 2022)

The bank is not a substitute for social housing. Regardless I'm not sure he'd qualify €100k is a sizable some of money. A quick look on daft and there are places available in Waterford for €100k. 

He gets a mortgage free home and the bank gets it's collateral.


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## Paul O Mahoney (23 Jun 2022)

skrooge said:


> The bank is not a substitute for social housing. Regardless I'm not sure he'd qualify €100k is a sizable some of money. A quick look on daft and there are places available in Waterford for €100k.
> 
> He gets a mortgage free home and the bank gets it's collateral.


But you nor anyone has an idea of his capabilities or otherwise,  perhaps his present home is fitted out specifically for him, or it has been a significant part of his life.

Banks make plenty of money on loans to housing Associations with one large one securing €350m in development loans from AIB, so when you say banks aren't substitutes for social housing isn't as black and white as you say.

The bank will get its money back plus  lower interest and one less person will be either homeless or getting Rent subsidies which already cost the state €1bn a year.


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## skrooge (23 Jun 2022)

Paul O Mahoney said:


> But you nor anyone has an idea of his capabilities or otherwise,  perhaps his present home is fitted out specifically for him, or it has been a significant part of his life.


There can of course be mitigating circumstances but like you say no one knows. In saying all that emotional attachment is a stretch. Just because I love my wallpaper doesn't mean I shouldn't have foreclosure on a contract I willingly entered into.

We can only work of the facts presented , as difficult as it would be to have your home repossessed today, he could be a cash buyer tomorrow. Let's not forget 68 is not that old in the greater scheme of thing. I'm sure age action would happily point out many are in great health. 




Paul O Mahoney said:


> Banks make plenty of money on loans to housing Associations with one large one securing €350m in development loans from AIB, so when you say banks aren't substitutes for social housing isn't as black and white as you say.



I'm sorry just because AIB, or any other bank, lend to housing associations doesn't make them responsible for provision of social housing... Banks are not responsible for providing social housing.



Paul O Mahoney said:


> The bank will get its money back plus  lower interest and one less person will be either homeless or getting Rent subsidies which already cost the state €1bn a year.



The bank will get some money at some stage but this is a loss for the bank. 

The State gets away with not providing a service it should and bank customers pay a higher price then they should have to. 

It's easy to see the €1bn the state is paying but the rest of us are paying for this approach through higher bank rates and fee's and less choice when it comes to financial services.


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## Brendan Burgess (23 Jun 2022)

The simplest solution here is for the state to pay his mortgage payments  in full. 

And the payments would become a second mortgage due to the state.

Or for simplicity, replace it with an interest roll up mortgage at 5% a year. 

Brendan


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## Paul O Mahoney (23 Jun 2022)

skrooge said:


> The State gets away with not providing a service it should and bank customers pay a higher price then they should have to.


So, its your contention that this cases and other PIA rulings is causing bank customers to pay higher price for financial services from banks ?

That's some claim.


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## Brendan Burgess (23 Jun 2022)

Paul O Mahoney said:


> That's some claim.



Hi Paul

It's a very valid claim. 

The banks claim that the higher mortgage rates are caused by their very high mortgage losses and their requirement to keep higher capital than is required in other countries. 

Brendan


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## skrooge (23 Jun 2022)

Paul O Mahoney said:


> So, its your contention that this cases and other PIA rulings is causing bank customers to pay higher price for financial services from banks ?
> 
> That's some claim.


You remember what happened over the last 15 years?? The small matter of the financial crisis?? Have you seen the numbers on people in long term arrears. Giving people time to get back on their feet is one thing but if 15 years later you still can't afford to live in your property I think the games up. Dragging this out doesn't do anyone any good.

In other countries you're expected to pay your loan or they take the collateral. That's why mortgage rates are lower than credit card rates. 

Timely enforcement of leading contracts just doesn't happen here in Ireland. If banks can't realise the collateral then the borrower faces higher rates. 

Let such an environment fester and foreign banks just leave. 

To claim otherwise suggests a lack of understanding of the facts


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## NoRegretsCoyote (23 Jun 2022)

skrooge said:


> Let's not forget 68 is not that old in the greater scheme of thing. I'm sure age action would happily point out many are in great health.


Most 68 YOs are not in any employment. This man seems wholly reliant on the state pension. He almost certainly has no chance to earn more. I wouldn't recommend this solution for a 38YO of course but the man's age is highly material.

I am very much in favour of creditors' rights but it has its limits. Forcing a house move on a 68YO has the potential to be detrimental to mental and maybe physical health even.

You forget that there is a residual value for the bank that it has to maximise too. Giving the man a 50% equity stake means he has a big incentive to maintain it as there will be something to leave to his heirs. This will work out better for the bank than a house that falls down around its occupants.


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## Paul O Mahoney (23 Jun 2022)

Brendan Burgess said:


> Hi Paul
> 
> It's a very valid claim.
> 
> ...


"The banks claim " where is the evidence of this, I'm not saying that mortgage non payments doesn't effect banks profits but look at the profits they are making, look at the deals they are making buy loan books from UB and KBC .

The remaining banks in this country are profitable on a operational level have been for year's so I genuinely do not believe that high interest rates etc are caused solely by defaulting mortgages or in this case a PIA judgement to allow someone continue to live in their home. 

Have banks ever reduced their mortgage rates when the made huge profits,  no they haven't. 

Sorry but unless the evidence to support this claim is published its simply an opinion.


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## skrooge (23 Jun 2022)

And I wouldn't be suggesting this for all pensioners but the elephant in the room is the €100k he would have access to. Now I appreciate with inflation this doesn't go as far as it use to but it is a substantial bank balance.


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## Paul O Mahoney (23 Jun 2022)

skrooge said:


> You remember what happened over the last 15 years?? The small matter of the financial crisis?? Have you seen the numbers on people in long term arrears. Giving people time to get back on their feet is one thing but if 15 years later you still can't afford to live in your property I think the games up. Dragging this out doesn't do anyone any good.
> 
> In other countries you're expected to pay your loan or they take the collateral. That's why mortgage rates are lower than credit card rates.
> 
> ...


Please don't patronize. 

We also have been giving the banks plenty of assistance via taxpayers funds and allowing them survive they were all bankrupt, and I know we need a banking sector but what good has all these bailouts achieved. 

The banks are operating profitably for years now, and I doubt this person will cause anymore hardship to anyone else.


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## skrooge (23 Jun 2022)

Wow where to begin.



Paul O Mahoney said:


> "The banks claim " where is the evidence of this, I'm not saying that mortgage non payments doesn't effect banks profits but look at the profits they are making, look at the deals they are making buy loan books from UB and KBC .


I'm not sure of your point here? Why do you think 2 banks would rather shutdown than continue to lend here?



Paul O Mahoney said:


> The remaining banks in this country are profitable on a operational level have been for year's so I genuinely do not believe that high interest rates etc are caused solely by defaulting mortgages or in this case a PIA judgement to allow someone continue to live in their home.



In order to get to that profitable stage they had to undergo some serious surgery. 1/8 mortgage holders fell into arrears. They needed huge amounts of public money so they could write down those mortgages and sell them off. You can't just cherry pick the post crises years and ignore what had to happen before to get them back to profitability. Even then when you look at their return on assets the returns are pretty small. 



Paul O Mahoney said:


> Have banks ever reduced their mortgage rates when the made huge profits,  no they haven't.


Rates have been falling in recent years.... 



Paul O Mahoney said:


> Sorry but unless the evidence to support this claim is published its simply an opinion.


On the capital claim the evidence is there.


			https://www.centralbank.ie/docs/default-source/publications/financial-stability-notes/risk-weights-on-irish-mortgages.pdf?sfvrsn=4afb931d_7
		




Paul O Mahoney said:


> The banks are operating profitably for years now, and I doubt this person will cause anymore hardship to anyone else.


I have nothing against the man but this case is symptomatic of an ongoing issue. There are over 5,000 households that are a decade behind in their mortgages that's just crazy. 



			https://www.centralbank.ie/docs/default-source/statistics/data-and-analysis/credit-and-banking-statistics/mortgage-arrears/2021q4_ie_mortgage_arrears_statistics.pdf?sfvrsn=df0f901d_7
		


It shouldn't never have been allowed to get to this. Off the wall solutions like the one suggested in the PIA is not the answer.


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## NoRegretsCoyote (24 Jun 2022)

skrooge said:


> And I wouldn't be suggesting this for all pensioners but the elephant in the room is the €100k he would have access to. Now I appreciate with inflation this doesn't go as far as it use to but it is a substantial bank balance.


It's not a bank balance - it's equity in a house!

As the old saying goes: "you can't eat a house".


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## ClubMan (25 Jun 2022)

NoRegretsCoyote said:


> It's not a bank balance - it's equity in a house!
> 
> As the old saying goes: "you can't eat a house".


You can't eat a bank balance either.


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## Paul O Mahoney (25 Jun 2022)

ClubMan said:


> You can't eat a bank balance either.


Indeed you can't,  however that 68 year old Gentleman doesn't need to....the PIA ruling ensures a roof his head and be able to live. 

Good ruling


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## ClubMan (25 Jun 2022)

Paul O Mahoney said:


> Indeed you can't,  however that 68 year old Gentleman doesn't need to....the PIA ruling ensures a roof his head and be able to live.
> 
> Good ruling


So there is such a thing as a free lunch after all!


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## lff12 (21 Jul 2022)

NoRegretsCoyote said:


> The article doesn't make clear, but it is an *interest only *tracker mortgage.
> 
> A contributory state pension is about €1100 a month. €93 a month is not very much compared to his income and his heirs will still get an inheritance as the debt won't grow.
> 
> He would probably pay a bit more as a share of income on a local authority differential rent scheme......


Astonishing, given that differential rent still underprices rents here so extensively.


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## lff12 (21 Jul 2022)

Dublinbay12 said:


> Banks are literally paying to sweep this under the carpet.
> 
> 
> 
> Bank of Ireland moves to improve CET1 capital ratio


I would imagine this is down to long delays in getting cases to court. There have been cases in the past year where the borrower stopped paying around 2007, before the changes in rules around arrears management, so there must be either an enormous backlog of cases, or else there is a lot of issues getting in the way of long term remediation.


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