Bertie gives "hard times ahead" warning

Re: Bertie gives warning

annR said:
Many peoples' fixed rate will be ending this year
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Can you substantiate this claim please?
I also read in the Sunday BPost yesterday that many people were stress tested to 4% back when the rates were 2%. Looks like the rates will exceed this!
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ECB rate was 2% in mid 2003. Mortgage holders at the time have had 4 years to reduce the capital outstanding on their loans so presumably the interest portion of their repayments has reduced in the meantime which might offset any rate increase?
 
Re: Bertie gives warning

annR said:
Many peoples' fixed rate will be ending this year and they will be going on to a variable rate. I also read in the Sunday BPost yesterday that many people were stress tested to 4% back when the rates were 2%. Looks like the rates will exceed this!
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Good point. Also remember that EBS got caught by the financial regulator for only stressing by 1% above the current rate. I'm not too sure how long ago they were doing this but all those people they approved on those terms will be dangerously close to the threshold, if they haven't passed it already.
 
Re: Bertie gives warning

ClubMan said:
Can you substantiate this claim please?
ECB rate was 2% in mid 2003. Mortgage holders at the time have had 4 years to reduce the capital outstanding on their loans so presumably the interest portion of their repayments has reduced in the meantime which might offset any rate increase?
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It was at 2% until the end of 2005 though so it's possible that many borrowers have only had 1.5 years to readust if they took out a mortgage at the end of that cycle.
 
Re: Bertie gives warning

Afuera said:
It was at 2% until the end of 2005 though so it's possible that many borrowers have only had 1.5 years to readust if they took out a mortgage at the end of that cycle.
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OK - I stand corrected on that so.
 
Re: Bertie gives warning

Aileen2 said:
Also lots of people have fixed interest rate mortgages and it won't affect them.
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There are always options - e.g.
  • Trade down
  • Extend the mortgage term
  • Avail of the rent a room scheme
  • Make expenditure cutbacks
  • Etc.
Also - mortgage interest relief as of Budget 2007 is much more generous than it used to be.
 
Re: Bertie gives warning

There are also the little matters of wage inflation, additional disposable income thanks to giveaway (and ridiculously inflationary budgets) and additional mortgage interest relief to remember, so whilst stress testing was carried out at 2% and whilst repayments have undoubtedly increased dramatically, funds to meet those repayments have increased substantially too - not to the same extent, but it will certainly alleviate the hit for many people.
 
Re: Bertie gives warning

So in a nutshell what should we be expecting of the warning? Some tough love from Bertie & Co. prehaps?
 
Re: Bertie gives warning

So in a nutshell what should we be expecting of the warning? Some tough love from Bertie & Co. prehaps?
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Maybe it'll go something like this:


I wish to talk to you this evening about the state of the nation's affairs and the picture I have to paint is not, unfortunately, a very cheerful one. The figures which are just now becoming available to us show one thing very clearly. As a community we are living away beyond our means. I don't mean that everyone in the community is living too well, clearly many are not and have barely enough to get by, but taking us all together we have been living at a rate which is simply not justified by the amount of goods and services we are producing. To make up the difference we have been borrowing enormous amounts of money, borrowing at a rate which just cannot continue. A few simple figures will make this very clear...we will just have to reorganise government spending so that we can only undertake those things we can afford.
—Charles J. Haughey, January 9, 1980​



Bartholomew P Ahern, July 1, 2007​
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Re: Bertie gives warning

annR said:
Do I have to? Isn't it true that lots of people in, say, 2004 would have fixed for 3 years and that that fixed rate term will be coming to an end now?
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According to the CSO 83% of outstanding mortgage debt is variable rate (2005 figures). In 2000, only 69% of outstanding mortgage debt was on variable rates. This implies that the bulk of mortgages drawn down in this period were variable rate mortgages.
 
Re: Bertie gives warning

From [broken link removed]
Almost 40,000 homeowners will pay 20 per cent more on their monthly mortgage repayments over the coming year as their discount mortgage deals end.
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Re: Bertie gives warning

tiger said:
From [broken link removed]
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Those discount deals were usually variable just sold at a reduced rate above ECB base rates (e.g. ECB+0.2%) and probably rolling to ECB+1% when the discount period ended.
 
Re: Bertie gives warning

I wish to talk to you this evening about the state of the nation's affairs and the picture I have to paint is not, unfortunately, a very cheerful one. The figures which are just now becoming available to us show one thing very clearly. As a community we are living away beyond our means. I don't mean that everyone in the community is living too well, clearly many are not and have barely enough to get by, but taking us all together we have been living at a rate which is simply not justified by the amount of goods and services we are producing. To make up the difference we have been borrowing enormous amounts of money, borrowing at a rate which just cannot continue. A few simple figures will make this very clear...we will just have to reorganise government spending so that we can only undertake those things we can afford.

—Charles J. Haughey, January 9, 1980​
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If thats the sign of things to come Bertie really will be doling out love of a tough nature.

Bertie is such a nice lad surely he wouldnt talk like Charlie? ;)
 
Re: Bertie gives warning

"Bertie Ahern give a hard times a head warning"

I always knew Bertie was a "header"
 
Re: Bertie gives warning

Interesting to note according to David Sharrock in The Times that our Taoiseach, Bertie Ahern, has been awarded a 14% pay rise, bringing his annual salary to €310,000 or £217,000 [he's been encouraging business on wage restraint]. He is now the highest paid leader in the 30 member OECD - well done, you deserve it thoroughly.

George Bush and Gordon Brown get £195,000 and £187,000 and are the second and third highest paid respectively. Commensurate to population with calculation against Bushs, he should be on about €3500.00.

Is this better value for money? Especially for a leader under investigation of corruption?
 
Re: Bertie gives warning

ClubMan said:
Mortgage holders at the time have had 4 years to reduce the capital outstanding on their loans so presumably the interest portion of their repayments has reduced in the meantime which might offset any rate increase?
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Unless they chose interest only right?
 
Re: Bertie gives warning

MichaelDes said:
Interesting to note according to David Sharrock in The Times that our Taoiseach, Bertie Ahern, has been awarded a 14% pay rise, bringing his annual salary to €310,000 or £217,000 [he's been encouraging business on wage restraint]. He is now the highest paid leader in the 30 member OECD - well done, you deserve it thoroughly.

George Bush and Gordon Brown get £195,000 and £187,000 and are the second and third highest paid respectively. Commensurate to population with calculation against Bushs, he should be on about €3500.00.

Is this better value for money? Especially for a leader under investigation of corruption?
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Brilliant post
 
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