Life Loans are back

Punter: “But people don’t know the dangers of these products”

Joe: “But to be fair, I’m looking at the website and there are five separate warnings. But then, if a product requires five separate warnings, should it be allowed at all?”

I’d forgotten how comical Liveline is. Absolute gombeenery and Paddywhackery.

“The tracker people got something and we should get something.”

“I’m just asking the bank to meet me halfway...”

“We own the banks...we bailed them out.”

WHY YOU CLOWN?!
 
Sarenco said:
What about the Housing Adaptation Grant scheme?
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Yes and very handy it is, approval slow and you really have to need it from a physical point of view, payout even slower but we got the max grant at the time and spent as much and more again to make the house somewhat comfortable. It pays for the basic works from the disability point of view of bathroom etc there was a lot extra needed to actually finish what was needed. It's some help but never covers all the work so some cash contribution is going to be needed from somewhere.

Not everyone is actually disabled though and might like a bit of updating of house re heating for example when older and a decent comfy couch to sit on etc :)
 
“There could be someone in Rathgar with a house worth €1.8m who took out a few bob and their house is probably still worth €1.8m...but the normal people!”

“These bankers in pinstripe suits...”

:)
 
“The last most despicable product” according to David Hall. “There are cheaper alternatives. Paying 6% to a bank that we pumped billions into!” :)

I’d love to see those cheaper alternatives.

The “do you know why the rate is so high? Because of programmes like this!” is just an epic comment. :)
 
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Great product for people with no children. Ireland's inheritance tax laws ignore any principles of equality. No children? No nephews or nieces? Take a look at how much Revenue will hoover up in inheritance tax.
If the choice is to leave the value of your house to a bank or to Revenue when you die, then you might as well choose the former and enjoy some cash while you're alive.
 
Brendan Burgess said:
1) You can't pay a Life Loan off early - yes you can.
2) You can't part pay a Life Loan off - yes you can.
3) If you pay a Life Loan off early you must pay all the interest for the remainder of the term up front - No you don't. You pay a break fee.
4) You can waive the requirement to consult a solicitor. From the brochure "Do I need a solicitor? Yes. It is a condition of the loan that all borrowers obtain independent legal advice. You may also wish to involve your family or anyone else likely to be affected by your decision."
5) David yesterday: 25k turned in 85k in 12 years - repeated multiple times ( it was IR£25k and it was 14 years)
6) James Smith today: €12k borrowed in 2002 became €43k by 2012.
6) They didn't tell you the implications of compound interest - here is the extract from the brochure
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This is ridiculous.

Anyone can make a complaint to the Broadcasting Authority of Ireland (BAI) which has guidelines on "Fairness, Objectivity & Impartiality". These guidelines linked to here, but it seems broken ATM.

Someone (not Brendan I guess) would have to make an official complaint to RTÉ within 30 days on objectivity grounds first. If RTÉ's response is not satisfactory it can then be taken to the BAI.

Details on how to do it here.
 
What was with the guy whose mother borrowed €12,000 over 12 years and claimed to owe >€40,000 at the end?

€12,000 @ 6.9% for 10 year is basically €24,000.

He made a throwaway comment about having gone to the Ombudsman or the Regulator and about the figures being verified.

But the numbers he was spouting just weren’t possible. It was nonsense.
 
Sarenco said:
Alternatively you could leave your house to a charity.
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That's certainly another option, open to those with children too if they so choose. Off-topic but the point is that those without children don't have the same choice of leaving 300K+ to an individual.
 
Gordon Gekko said:
What was with the guy whose mother borrowed €12,000 over 12 years and claimed to owe >€40,000 at the end?

€12,000 @ 6.9% for 10 year is basically €24,000.
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Hi Gordon

His name was James. For some reason, I thought he sounded genuine. Mistaken and misguided, but genuine.

I contacted the programme afterwards to check his figures for him.

It could well be that his mother borrowed €12 k , and then took out another loan of €12k without telling him.

Brendan
 
Brendan Burgess said:
2) You can't part pay a Life Loan off - yes you can
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I might have misunderstood the caller today, but I think his argument was that he couldn't make a part payment after the borrower had died, therefore a part payment wasn't possible? I might have misunderstood it.
 
Hi Red

Absolutely no need to apologise.

I make one small error in a long debate - and it was my understanding.

They made multiple outrageous and huge erroneous statements.

Brendan
 
Hi Brendan,

No, you were correct. My full point (which I didn't make) was that if the borrower died, it was a condition that the loan be repaid in full. Usually by selling the property.

During the lifetime of the borrower, partial or full repayments could be made.

It was difficult to follow bits of the conversation.
 
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Compound interest? An ordinary mortgage of say 30 years pays the bank back about twice what was lent, and that's with regular repayments. What's the big shock in paying them twice over 15 years when there are no repayments?
 
Duke of Marmalade said:
Compound interest? An ordinary mortgage of say 30 years pays the bank back about twice what was lent, and that's with regular repayments. What's the big shock in paying them twice over 15 years when there are no repayments?
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That’s a really good point that none of us have made specifically.

I think I’ll call “the bank” today and “ask them to meet me halfway”.

When the Liveline listeners hear how much I’ll pay back over the lifetime of the mortgage, hopefully they’ll remind the bank that we bailed them out!
 
RedOnion said:
I might have misunderstood the caller today, but I think his argument was that he couldn't make a part payment after the borrower had died, therefore a part payment wasn't possible? I might have misunderstood it.
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His phrasing seemed vague, almost deliberately so. He would say "we couldn't pay it back" without clarifying if he meant that they weren't allowed to pay or back, or didn't have the funds to pay it back.
 
Brendan Burgess said:
If anyone wants to compile a list of serious factual errors in the two shows it would be well worth sending it to Joe Duffy. Off the top of my head.

I am sure that there were others.
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7) James assertion that his mother was in a position to get the Fair Deal scheme when she had an asset and the loan but that she was no longer eligible after they had sell the house because she 'no longer has an asset'.
This is simply not true, in fact her eligibility should have improved. I don't remember his figures but if, for example, she had a PPR worth €500k and a loan of €150k, she would have been assessed at 7.5% of €500k. By selling the PPR, the net proceeds of €350k would be assessed at 7.5% so it would have been an advantage to her if she was bordering on eligibility or not. What James was really not happy about was losing the 3 year PPR protection in the FDS and that her cash assets (his inheritance) would continue to dwindle beyond year 3 of FDS
To go a step further, if her only income was state pension (~€13k), 80% is assessed for FDS so approximately €10k. On average, nursing homes cost in the region of €60k per annum so for her not to be eligible for any contribution from the FDS, her remaining assets must be north of ~€660k (€50k/7.5%).

8) Joe's continued reference to the people burdened by the repayments (the children) & 'What about the people who have to pay it back?'
No child or spouse had to pay anything. The life loans were repaid from the estate of the borrower, not from the pocket of the children. As executors of a will, they may have been involved in selling the property to clear the debt and felt like they were paying with their own money (the inheritance) but this is again factually incorrect.
 
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