One potential solution for me is instead of extending mortgage interest relief which I have been an advocate for, how about using that money along with a government bond issue or whatever it takes to raise the necessary capital required instead as well as the fact that we own AIB and PTSB and inject money into those 2 banks with specific instructions from the new minister for finance to reduce their SVR rates to somewhere near the EU average. This would surely put serious pressure on the other thieving banks to reduce their rates, the minister is after all representing our interests in these banks or at least he should be. As far as I'm concerned I don't give a damn about it breaking any ECB rules seeing as this country's been fed to the wolves already, it would be about time something was done for the ordinary people instead of senior bond holders and their like. If people in this country are prepared to tolerate high SVR rates and not take to the streets then something radical needs to be done because the banks will sit back for all time on this if let.This would certainly create competition that those greedy so and sos in the likes of BOI would have to take note of. Their recent agm highlighted profits again of which quite an amount comes from us gombeens and which goes into some of the best paid managers pockets, imagine a salary of approx 900,000 a year, nearly 4 times Enda Kennys salary.
Deal includes: " A commitment to tackle high mortgage rates, including legislation if possible"
- Thread starter tonymac
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Not a realistic option Tony as Government priority is to divest themselves of these banks ASAP. Interference in their operations is not an option if they want to sell their interests.
I do appreciate that fact 44brendan but at the end of the day an injection would surely increase switcher business in favour of the 2 of them. I also know you'll probably tell me once they go private they'll put rates back up again. If my option is not realistic in you're opinion what do you think can and should be done to solve this and solutions such as increasing competition , accurate as they might be have already been put forward here. We need to get something going now out of the negotiations and while we still own those 2 banks. We have after all been screwed like no other group and something radical is required, just look at what's happened to the water charges which for me came from pressure. I am also sick to the teeth waiting for competition to emerge all the while the banks are taking €2,500/year average off each affected SVR holder. Our problem is we haven't applied any pressure and the banks are laughing at us, ive advocated things like public protest and a mortgage strike but I've also said I wouldn't do these unless there's significant support and im not talking about 100 people. Unfortunately too many people are either happy with the rates they're paying, they can't be bothered to switch or protest or they don't realise what this is costing them. Imagine FF and FG spent all this time arguing about water charges and all due respects to that campaign they're only 10% of what we're losing. Anyone with any original proposals regarding what should be done ill gladly listen but other than maybe our great white hope Michael McGrath in these talks or something radical like I've suggested nothing else appears to be jumping out at anyone. Maybe Frank money might get approval before 2019 at the rate those pro - banks yo yo in the CB get to move on things.
Yep. Around 50% of new borrowers are currently opting for variable rate mortgage, where the rate can be changed at any time at the discretion of the lender, rather than opting for fixed rate mortgages.
Would that apply to all current customers?
Or would lower rates apply to borrowers with smaller loans, lower LTVs, lower LTI and overall DTI ratios, shorter loan durations, no dependants, multiple sources of income, etc.?
There are multiple factors of relevance in assessing the riskiness of a loan and surely you would expect a lender to demand a higher rate of interest for a higher risk loan. No?
Also, would new entrants not get a "free ride" (as they have no current customers)?
R
rodger
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R
rodger
Guest
It will be interesting to see how a minority FG behaves.
Will there be any action from Noonan on variable rates?
Up to now he has been a pushover as far as BOI is concerned.
Will there be any action from Noonan on variable rates?
Up to now he has been a pushover as far as BOI is concerned.
What do you think/believe Noonan can do with an independent institution such as BoI?
R
rodger
Guest
I know what he should do:
He should ensure they don't charge more than say ecb+3%
Because we are tired of bailing out the banks.
There was talk of a tax on banks if they failed to pass on the ecb cuts
What can he do? He can legislate to protect bank customers who are also the tax payers who bailed out the banks.
From what I have read FF Michael mcGrath would do something.
He should ensure they don't charge more than say ecb+3%
Because we are tired of bailing out the banks.
There was talk of a tax on banks if they failed to pass on the ecb cuts
What can he do? He can legislate to protect bank customers who are also the tax payers who bailed out the banks.
From what I have read FF Michael mcGrath would do something.
Brendan Burgess
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Michael McGrath has been speaking to the Times Ireland
"The pledge does not contain any detail but Michael McGrath, Fianna Fail spokesman for finance, said that he wanted to bring forward legislation to give the Central Bank the power to “intervene in relation to interest rate policies”.
Mr McGrath said that variable rates, which affect at least 300,000 mortgage-holders, needed to be brought into line with other European countries. He said that the Central Bank (Variable Rate Mortgages) Bill 2015, which the party tabled last year, would balance the need for banks to be profitable and the rights of consumers to be treated fairly.
“This would act as a strong deterrent to prevent banks from charging excessive rates and would only necessitate Central Bank action where the evidence points to a clear market failure,” he said. “We do not believe this would act as a deterrent to competition. Other European countries have successfully introduced legislation which has put downward pressure on mortgage rates.”"
"The pledge does not contain any detail but Michael McGrath, Fianna Fail spokesman for finance, said that he wanted to bring forward legislation to give the Central Bank the power to “intervene in relation to interest rate policies”.
Mr McGrath said that variable rates, which affect at least 300,000 mortgage-holders, needed to be brought into line with other European countries. He said that the Central Bank (Variable Rate Mortgages) Bill 2015, which the party tabled last year, would balance the need for banks to be profitable and the rights of consumers to be treated fairly.
“This would act as a strong deterrent to prevent banks from charging excessive rates and would only necessitate Central Bank action where the evidence points to a clear market failure,” he said. “We do not believe this would act as a deterrent to competition. Other European countries have successfully introduced legislation which has put downward pressure on mortgage rates.”"
No.
I have no idea what Michael McGrath is talking about.
France has legislation in place that limits the rate that can be charged to 133% of the market average rate on all outstanding mortgages over the previous quarter but no EZ states vests a power in any State official or institution to fix or cap mortgage rates.
Fixing the price of credit in this way would be totally inappropriate in a free market economy. It's really not a viable proposal.
On Prime Time the other night Michael McGrath said something to the effect that, under the new poliitial deal, when he puts forward a bill on the standard variable rates it would now pass (presumably because FG won't vote it down). Fair play to this man - who has consistently brought the SVR issue up. Like an earlier poster, I gave my vote to FF based on how Michael McGrath had fought for us. I feel very much betrayed by FG who could have done something for us ages ago. Very very foolish of them. There are a lot of the 300k mortgage holders out there who are not engaged with our campaign - but if/when Michael McGrath brings through legislation and they see a deduction in their mortgage payments I hope they give FF the credit. (btw I am a former FG supporter/voter).
No mention of that in the published deal:
http://www.irishtimes.com/news/poli...ael-fianna-fáil-deal-for-government-1.2633572
Don't forget who was in Govt supposedly managing the economy when the Banks were going mad. Lets not get all pious about FF and paint them to be some sort of modern Robin Hoods.
And lets see if anything can be done because I just cannot see how it is possible for a Govt in the Eurozone to set interest rates for the mortgage business of private banks.
I fear for SVR borrowers if that's all the legislation does. Lane will be far more concerned with the profitability of the banks than the plight of hard pressed borrowers imo.
The thing is in this country we bailed out the banks and what do they do they abuse 300k of the people who helped pay for the bailout by charging the highest SVR'S in Europe, this despite the lowest ECB rates in history because they can. The banks in this banana Republic of ours don't deserve to be treated like a normal bank in a functioning economy because they've abused their right to set rates like no other eurozone country has and as a consequence they should be taught a lesson until they learn manners, eg a law that keeps them in line where they should have to justify their reasons for keeping rates high and if they can't then no increases.
R
rodger
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That hits the nail on the head!
Brendan Burgess
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And it appears to also include concrete proposals to raise mortgage rates.
"The Irish Times understands one of the measures ... is the creation of a new body which will seek to assist homeowners facing repossession.
Under this proposal a court will be unable to hear a repossession case until it has been processed by this new agency and all resolution options examined."
"The Irish Times understands one of the measures ... is the creation of a new body which will seek to assist homeowners facing repossession.
Under this proposal a court will be unable to hear a repossession case until it has been processed by this new agency and all resolution options examined."
Yup.
The FF/FG deal includes a commitment to "protect the family home and introduce long term solutions for mortgage arrears cases" AND "take all necessary action to tackle high variable rates" (they seem to have dropped the reference to introducing legislation in the final text).
In practice these policies are contradictory. The politicians obviously know that but as long as the electorate continues to blame banks for high mortgage rates they continue to get off scot free.
If we are prepared to accept high levels of mortgage arrears then we have to be prepared to accept high mortgage rates. It really is that simple.