TRS should be retained!

Paul Reilly said:

its obvious some people here are affiliated to political parties and fair enough.

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Never even thought of having any affiliation with any Political Party much less having one. When I have an opinion on something I will state it regardless of what party it offends. I just do not like gimmicks.

As WorstPigeon states the main area for stress would be for mortgages taken out in the 2004 to 2008 period and a high proportion of these were Tracker Mortgages. These mortgages are now between 8 & 12 year old.

If someone with an 8 year old Svr mortgage taken out over a a 25 year period and continued to pay P & I for the last 8 years they have reduced the loan to approximately 77% of the original loan. On average the Interest portion is probably less than its rental value.

If someone with an 12 year old Svr mortgage taken out over a a 25 year period and continued to pay P & I for the last 12 years they have reduced the loan to approximately 63% of original loan. The Rental Value in this situation has a high probability of being much higher than the Interest portion of this loan. There is a good chance that it is not in negative equity now.

In post no 6 on this thread I gave a practical example in relation to a family member and I gave my view on whether they should get it and that is why I called extending TRS out to 2020 a populist gimmick and I make no apologies for so doing.

If someone can justify why everyone (that originally qualified up to 2017) regardless of circumstances/income or size of mortgage should get TRS extended out to 2020 I would like to hear it.

The promise is to extend it out to 2020 and nothing about exceptions or exclusions

I think for the service SVR holders have done for the state I think they deserve more than being told tough and just get on with it. Our taxes bailed them out before and what reward do we get, we're told bail us back into profit so we can be sold to the private sector who will then surely raise the variables again as soon as possible. I must be one of the very few people who has a sense of grievance as large as the hole those dastardly banks put in our country's finances and have to date got away scot free with all they've done. Re SVR'S they've been disgracefully been allowed to exploit the clause in our contracts saying the rates may be altered from time to time. Yes we signed up to that but I certainly didn't sign up for what's happened since. This is the reason the right to set rates as they wish should be taken from them and replaced with them having to explain to the CB why they want a rate increase above say 3-3.5% which is still 1% above the average European rate.

tonymac said:

This is the reason the right to set rates as they wish should be taken from them and replaced with them having to explain to the CB why they want a rate increase above say 3-3.5% which is still 1% above the average European rate.

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Fair enough but none of that justifies the proposed extension of mortgage interest relief.

Why give the Central Bank a power they don't want and almost certainly won't exercise? Why not advocate in favour of the introduction of a simple statutory cap equivalent to a certain percentage (say, 133%) of the average rate on all outstanding mortgages (which is actually roughly equivalent to the European average)? That's the system they have in France and it would appear to achieve exactly what you want.

That cap you mention sounds like a good idea in fairness. I do hope I'm proven wrong re the potential for arrears and repossessions increasing in the future but neither of them becoming more prominent as I fear they will at least partially because of the high SVRs is any good for any of the stakeholders in this country, the state or its citizens. Correct that they don't want that power but I think they do need to be made enforce their consumer protection code role properly, how they do it overall is something that all those highly paid financial people in there should come up with but the CBs blatant cutting adrift of SVR holders is disgraceful as is the way they've let the banks do what they want. A code of conduct for banks in tow they set rates does need to be implemented and supervised by the CB. The banks as I said earlier have blatantly abused their right to set rates without close scrutiny and for me if they are allowed continue with this resulting in us suffering should mean some form of help until the authorities do what they should be doing eg protection of all citizens in the best way possible. I do agree to be fair that there probably is a better way to spend money than TRS but getting rid of it should be accompanied by enforcement of a code of conduct and banks having to justify why rates should be so much above the rest of Europe

speaking as a recipient of TRS with no strong political alliances, i'd much rather have the political parties tackle high rates than extend TRS.

not necessarily TRS, but a large contributing factor to 'the crash' were tax break related. that's fine if people approach them as a short term measure but placing too much reliance on a benefit or incentive that has a finite life is a mistake

and i'm not being preachy because this isn't the way i approached it when i took out a mortgage in mid 2008 (when interest rates were still rising so, clever me - i fixed at 5.18% and missed the tracker boat) - hindsight is great!

instead of tackling the elephant in the room TRS extension just kicks the can down the road further (again)

I'm not in favour of extended TRS at the expense of others - also TRS is very unfair in my opinion in that it is paid to each person and not per mortgage - I get €75 a month on a 300k mortgage (that I pay alone, 1 salary household) while the couple next door on 2 salaries, double my wages get €150 a month for a 300k mortgage.
Very unfair!

Hi Pinkie

To be absolutely accurate, mortgage interest relief is a tax relief based on the amount of qualifying mortgage interest that you pay in a given tax year for your principal private residence. However, the ceilings or upper thresholds on the amount of interest paid that qualifies for tax relief are dependant on:

• whether you are a first time buyer; and
• your individual legal status (i.e. whether you are married/in a civil partnership/widowed/surviving civil partner).

I'm inclined to agree with you that getting a higher relief simply because of your marital status seems a bit out-dated at this stage.

I am receiving TRS and dread the day it is gone! I bought in 2008 - an overpriced house, the one next door sold recently for what I now owe on my mortgage after paying for years. No positive equity where I am. The banks overcharge on SVR mortgages and get away with it - I'm also caught for that. When TRS goes my mortgage will go up more and I already feel like I am managing rather than having anything left over to do anything with. If I rented I wouldn't even cover my mortgage with the rent I'd get.
Ideally I'd like someone to deal with SVR mortgages so that Irish banks treat their customers the same as European banks treat theirs but I am one of MANY who really depend on the TRS on our mortgages.
I also live in fear of the day SVR rates rise!