Mortgage debt forgiveness?

BlairWaldorf · by **BlairWaldorf** » Wed Apr 13, 2022 8:25 pm

newmammy wrote:I know i'll be really annoyed if this happens. I know that a lot of my friends etc. own houses which are a lot bigger than mine, and also borrowed on their mortgage to buy two new cars, pay for a wedding and had fabulous holidays. Myself and hubby saved 10% deposit to buy our house, borrowed only enough to put up the blocks and pay for the site and for the last five years have been saving to furnish and decorate each room and do our garden, our tarmacadam etc. When we moved into our house the only rooms whcih were liveable were the kitchen, one bedroom and en suite. We were also engaged for nearly three years while we saved 30,000 to pay for our wedding in 2006. We drive a twelve year old car which is not big enough for us now that we have children and the only foreign holiday we have had in the last six years is our honeymoon. I know ill be furious if we have made all these sacrafices for nothing. I've lost my job but we can afford to pay our mortgage (we struggle some months but its always the first thing that we pay) because we were careful. If people I know get portions of their mortgage written off because they have been having a good time for the last six years or so i think its very unfair. I also think passing on debt to the next generation is very unfair on children. Im sorry if this sounds really mean but the way I see it is nobody made anyone buy a house - and also when you enter a mortgage agreement it is written on every piece of paper you receive that if you don't keep up your repayments your house is at risk.

Also, i think the banks saying this is going to cause them problems because I think a lot of people who are struggling will now let their mortgages go into arrears. I know I would love to have the extra 1,100 a month whcih we pay on our mortgage to do all the things I cant do now that Im not working

Great post newmammy.

dymo2 · by **dymo2** » Wed Apr 13, 2022 8:43 pm

No way do i aggree with this some people bought house and built bigger house just to be better than there friends.we did not and now soome people what us to bale them out after them been the ones that took out all the money when somepeople new that they werealways new that they were going to find it hard to keep up there repayments.Maybe let them have intrest olny for a ceratin lenght of timke or adding time on to the mortage no way should people just be allowed to walk away from their debts

by **MrsP2011** » Wed Apr 13, 2022 9:30 pm

I think something needs to be done with the negative equity but that only really comes into play when you want to sell your house. We bought an apartment and like a lot of my friends, we figured that in time we would trade up and buy a house when the time came. Now, with the amount of negative equity we're in, unless the government intervenes in someway, we'll never trade up. What will happen the property market then?

Totally don't agree with debt forgiveness, we have struggled for the past couple of years, both lost jobs at different points, we're earning about 30k less than when we first got the house and we've never fallen behind. I think it would be grossly unfair to all the people who have literally broken their backs trying to pay their mortgage. And while I'm sure most cases are that of genuine hardship, like everything else, there's always someone on the make and strategically not paying their mortgage.

I Dream in Disney · by **I Dream in Disney** » Wed Apr 13, 2022 10:09 pm

Haven't read all the pages so not sure if I'm repeating the same thing as everyone else.

I don't agree that people should just be 'let off' from their debt. We don't own a house, we rent. We are not capable of making a 20/25+yr commitment to our finances. We sure as hell aren't dumb enough to go way over our heads in debt when we don't even have enough to put down a deposit. I would be FURIOUS if people are just allowed to wipe the slate clean when they weren't able to make mature decisions.

However, the alternative may be that people can not keep up with mortgage repayments. The loose their house, families are homeless. We have thousands of additional homeless people draining on our countries resources. And as most people know, homelessness is a downward spiral.

I would assume that in the people who would be eligible for mortgage debt forgiveness would be in absolutely dire straits with no other recourse. The debt forgiveness would work in a similar way to CCJ's. (I'm not sure if these exist in Ireland, but they do in the UK) In which case they would find it extremely difficult to get any line of credit in the future and it would also limit their employment options. I would also hope that these people would have to go through money management courses and demonstrate a commitment to improving their position. They should also have to make the commitment to pay back, say 75% of the outstanding debt over the course of their lifetime.

I do not know enough about the proposal (or national finances in general) to make up my mind on it. But any losses should be compared to the potential drain on national resources if these same people had to seek sheltered accommodation, etc.

by **BabasFor2012** » Thu Apr 14, 2022 6:54 am

This probably wouldn't work, but it's what I'd love to see done.

They base how much the banks need on the likelihood that some of the loans they have that are performing now will become unprofitable in the future? Also on the fact that any people are in arrears now. So why not figure out a percentage to pay off everyones mortgages with the money they are giving them anyway? I'm sure it is far too simplistic, but it makes sense in my head :o0

I'm sure there are plenty of people who will go into arrears if they think they will get let off some of their mortgage as a result. Personally there's no way I could do that, the mortgage is the first thing to be paid even if we have to live on beans on toast for the rest of the month, couldn't sleep if it wasn't paid. If we really start to struggle we will go to the bank and ask them about interest only for a while or something. But again, while I bought at the start of the boom, because I looked for somewhere that would actually have other reasons to improve in value other than house prices in general, we would not be in negative equity now (just), We used his savings then to get married and only had a foreign holiday since then as we got a great opportunity to go abroad on an amazing holiday without it costing anywhere near what it should have, so we used some of his redundancy money.

I would hate to think that some of the people I know who seem to think of paying the mortgage as an optional extra would get let off, but then I know there are plenty of people who genuinely try and are struggling real bad that were led on by certain politicians to think that the economy would be fine and they would always have good jobs, I'd hate to think they will lose their homes even though they are trying hard.

Negative equity is very hard on the psyche, but as someone else said should only be a problem if you have to sell, very hard to see it like that though if you are in that position I'm sure. Also if it turns out that where you bought really doesn't suit at all then it must be very tough. I know from experience that when you are buying the first time you won't know everything to think of that will make your dream home. Thankfully in our case, it's nothing that can't be changed in time, but if it was your neighbours and you couldn't move it could be quite miserable.
Sorry for rambling on :-8

Momof2 · by **Momof2** » Thu Apr 14, 2022 7:18 am

Looks like we're all in agreement really. Hubby had a great idea last night when I was chatting to him about it. He said they reckon the bailout is costing us all 48K* so he thinks the bank should deduct that amount from all our mortgages as he said its the only way we'll see it back :eek

*not sure where he got this figure from but I liked the idea of 48K less on my mortgage

lux · by **lux** » Tue Aug 30, 2022 1:01 pm

I'm bumping this up as there has been a lot of focus on this lately.

Reading over the old post, it seems most are opposed to it. I'm curious as to where the calls for debt forgiveness are coming from, as most people I know are totally opposed to it.

GreenerPastures · by **GreenerPastures** » Tue Aug 30, 2022 1:12 pm

In theory maybe, but in practice No. Who pays for this in the end??? Who is deemed more in need of it than the next person? I don't see it working and can see it causing more strife and aggro with the ordinary Joe Soap.

whoop whoop · by **whoop whoop** » Tue Aug 30, 2022 1:16 pm

God there are some horrible attitudes on this thread!

Others shouldn't have their debts forgiven because they got a nicer house than me???

People shouldn't have their debts forgiven because there are people that go without basic necessities to pay off their mortgage??? (um...can we all go over to the thread on the guy who wrote into the Irish Times to see all the moral outrage and judgement being poured on his head for doing just that!!)

This country is up sh*t creek. As another poster said, if it is for the greater good that people in dire need are given some assitance, I won't stand in the way just because of reasons of 'But what about MEEEEEE???'.

I can repay my mortgage at the moment, and I'm glad of that. No, it's not easy, and if I lost my job, I would be totally screwed. Yes, I bought into this and made my choices, but we all trusted what the people in the newspapers, staff at the banks etc. were saying, as they were the experts.

If this goes ahead, rather than being annoyed that I can pay my mortgage while others are given a helping hand, I will be grateful that I can keep up my payments and will still have full ownership of my house when the mortgage is paid off. And I will be grateful that should bad luck fall on my head, I will be helped, but at the cost of the bank owning part of my house.

teapotty · by **teapotty** » Tue Aug 30, 2022 1:25 pm

People need to stop looking at their own situation and saying things like "Well I didn't borrow big so I'm not paying for Billy down the road who got a 120% mortgage for house, car and a wedding". The country/ economy AS A WHOLE is suffering because of the large number of mortgages in arrears. And as long as this number continues to grow (which it will unless something constructive is done) the economy cannot recover because money is being pumped into mortgages and not into regular consumer spending on things that create jobs like food, clothes, entertainment, holiday etc.

So before you say "I don't want my tax to go towards debt restructuring" ask yourself if you want this economy to ever get back up off its knees?

It annoys me that taxes go towards paying for scumbags to rehabilitate from drugs, for prisons, for millions of Euro for gardai to fight drug wars etc but it has to be done because it's for the GREATER GOOD OF THE COUNTRY. I apply the same theory to mortgage restructuring.

There's more uproar over this mortgage debt restructuring than there was over the bank guarantee. I find that a bit mad.

hestia · by **hestia** » Tue Aug 30, 2022 1:47 pm

Jesus. Reading that was the equivalent of being on a long taxi journey with the driver in full-swing. My toenails hurt.

by **britneybride** » Tue Aug 30, 2022 1:50 pm

my friend borrowed 100% morrgage in 06 for a 3 bed semi costing €340 she is on tracker rate. We struggled to save 8% deposit in 03 for a 3 bed duplex costing €245 we borrowed €220.00

We pay €1380 @ 5.8% with TSB a month, my friend is on tracker rate of 2.5 not sure her monthly repayment but lower than ours .....

We are both in NE she can move because she can negotiate with the bank to write off some debt if she gives up her tracker !!! We are stuck in a duplex because it was all we could afford at the time we never traded up during the madness and now we are screwed.

Debt forgiveness will not work people will take advantage

PT2012 · by **PT2012** » Tue Aug 30, 2022 1:55 pm

whoop whoop wrote:If this goes ahead, rather than being annoyed that I can pay my mortgage while others are given a helping hand, I will be grateful that I can keep up my payments and will still have full ownership of my house when the mortgage is paid off. And I will be grateful that should bad luck fall on my head, I will be helped, but at the cost of the bank owning part of my house.

I can see where you are coming from with this as I have been out of work, on the dole, scrapping by just to keep my head above water with my mortgage - the only debt I have.
And if I had the safety net of being helped out then I can see the benefit but I don't think that is the way they will do it.
There might be 1 wave of a bailout for mortgage holders and then they will figure that it won't work just like bailing out Anglo didn't work.

lilywhite2012 · by **lilywhite2012** » Tue Aug 30, 2022 2:07 pm

I'm not sure if debt fogiveness will work but i believe something needs to be done.
My OH bought a house in 2008 for 200K its now worth 170K - his work transferred him to the other side of the country where we both live now. The rent on the house only covers half of the mortgage payments and we pay high rent where we are living now. There is no chance of him getting transferred back to where the house is located so we are stuck in this situation.
Serveral solutions to our problem have been put forward to the bank. As the NE is only 30K we suggested trasferring this amount into a personal loan - they wouldn't let us do that. We suggested carrying the 30K over to another mortgage - they wouldn't let us do that. We asked to go interest only for 6 months so we could get back on our feet - they wouldn't let us do that!
So our only option now is to try and save the 30K (that amount will probably increase by the time its saved) and struggles massively trying to pay both rent and mortgage. Its frustrating!

teapotty · by **teapotty** » Tue Aug 30, 2022 2:22 pm

lilywhite2012 that's a really frustrating situation- i really think there needs to be a code set in place for some flexible options for carrying NE to another mortgage or paying it off as a separate loan after a sale maybe. It really seems like nobody is coming up with some solutions which at least might allow people to sell or move but still pay off all the money they owe.

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