teapotty wrote: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.

Allowing some NE to be carried with you is the only way I can see out of this mess for most people. I know it won't work for everyone (my NE is currently 100k and I realise that's too much to carry to another property on my own) but the likes of 30k on a mortgage with 2 of you should have something done.

That said I'm not great at all this stuff so wouldn't know any of the negative effects and risks etc associated with allowing people to carry NE with them - but it's the only thing I can see feasibly helping people in the near future and helping to get the property market moving again.

Supposedly part of the money given to the banks to bail them out was to offset mortgages that were not going to be paid so technically they should be offering some form of debt forgiveness which i think to some extent they are. They cant offer it as a come here and get it option but it does APPEAR that they are doing something for some on an individual basis and I presume this is to stop people from taking the option of just not paying on purpose.

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

Quite.

It's essentially about equality before the eyes of the law. That will require a few moral leaps on the part of the state.

teapotty wrote: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.

Excellent post Teapotty, something needs to be done and fast as the economy will spiral even further. None of what has happened is fair to the general masses and very frustrating to read the "Big Boys" going unpunished, but we really do have to implement some sort of restructuring to try to solve some of this mess.

I posted on this thread when it was out first and at the time I didn’t think debt forgiveness was a viable option because of the amount of things that could go wrong. While, ultimately, I believe that everyone should pay their debts, how could the world/economy work otherwise, I do believe there something needs to be done. I just don’t know what. While I’m not averse to assisting the economy get back on its feet, I just don’t think any form of blanket debt forgiveness is the answer. Allowing people to walk away won’t help us, as a nation, learn from our mistakes – the exact same thing will happen again in ten years time and we’ll wonder why? It’s not a question of me feeling hard done by if others get their debt forgiven and I don’t, it’s about the bigger picture. If people are in dire straits, literally cannot feed their families, then perhaps debt forgiveness would have to be an option but equally, I think anyone in that situation shouldn’t be extended any form of credit for at least a ten year period and only then with evidence of prolonged savings over the same period. That’s the only way to ensure people don’t get off scot free.

Options I can think of are longer repayment periods, lower interest rates in certain cases for a certain period (yes, the banks would lose out but when the alternative is a firesale with a 50% debt write off, I think they’d be willing to discuss options), moratoriums while people job seek, interest only options, better interest relief on rental income, maybe legislation which allows for a tax exemption on rental income from a property in negative equity for a 5-8 year period (similar to capital allowances schemes) – this would allow someone with a house in NE to rent it out, not have to worry about tax on rental income and rent another larger property themselves. I know the notion of carrying a mortgage to the next generation is seen as abhorrent by some but it’s not necessarily a bad thing. It’d be similar in nature to the idea of “rent control” in some US cities, mainly New York whereby long leases on apartments were passed on from generation to generation at a rent controlled price allowing people to live in central Manhattan areas at 1960s or 1970s prices. People are forgetting that while NE might seem like a disaster now, it will, over time, reduce and eventually disappear. DH and I just don’t worry about our NE – we’re in about 150k of NE but the way we see it, we continue to pay, we’re in our late twenties now, by the time we’re in our late 30s we should have a serious chunk of that paid off, we should have prob 200k in savings and even if we have to rent for the next 10 years, then we’ll be able to buy somewhere outright if we want. I don’t think people are seeing beyond the paper loss they’re currently sitting on. I appreciate this is easy for me to say when we both have good jobs and plenty of money but I think we, as a nation in general, need to take a longer term view. If people can restructure their debt and back end the higher mortgage payments maybe, for the next few years rather than front ending them, remember the mortgage payments are always highest in the first few years, then in 5-10 years, we should come out the other end. Our problem is that we want instant gratification. The same problem we had during the boom, instead of saving deposits we bought houses with 100% mortgages. We were a credit nation. I am speaking in generalities obviously here, please don’t jump on me and say “not everyone bought a house they couldn’t afford” etc. I’m just trying to make a point about Ireland as a country – we need to wait it out. There are no short term solutions.

ok...this mortgage ne stuff has me ill n i mean ill... panic attacks no sleep depressed ect!!!

my situation is that myself and my partner bought in 2005 3bed semi 233k... got a loan from loan from parents of 10k for deposit... which we had to re morgage for a yr later to pay them back as promised...

we found out we were pregnant and paniced... i was going to have to take maternity lave and house prices were climbing by the week... if we were ever going to have our own home we needed to act now!!!

we had 2k savings and worked our asses of to clear my debts...car, personal loans ect prob about (30k) and come up with another 9k deposit for house.

in we went to first active bump n all no questions asked here u go 214k... a year later a 35k top up to do up the house and pay back parents...(i was only working pt the yr later)

now house is worth 140k and have morgage of 235k... im unemployed getting 84.50 per wk and hubby is earning about 500 per week and we now have 2 children age nearly 7 and 4.

we went last yr to the bank told them we were struggleing,applied for interest only and after waiting 3mts were told ooo ur only short 50quid a wk!!! so cut off ur ntl gas n esb and u will be grand!!! i couldnt belive this is what we were being told... i was told we could appeal this decision which we did and they exteded the life of our morgage by 6yrs ... it was already over 35yrs so now its 41 years!!!

hubby will be 71 and i will be 68 when morgage is cleared... if i could get a job i would but who minds our children... i cannot afford childcare i had planned to go back to work after the second child just like i did with the 1st but was in a violent robbery when 7mts pregnant. then i cared for my gran who had alzimers for 2yrs unfortunatly she passed away last yr.

anyway were in arrears. cant sell.cant pay. what do we do?... i sold on ebay n carboots to scrap some money tougheter at xmas for the kids but everyday is a struggle... my husband is working 60hrs a wk for the same money as he did 6yrs ago for 40hrs.

its a vicious circle im so stressed and unwell over this i try not to express all this to my husband as he is trying his best... everyone says aha u two need some time to urselfs go out... eeemmm that costs money n we dont have any money... kids miss him as hes always in work as do i but i know theres no other way of scraping by so for us GETTING RID OF OUR MORTGARE NE IS AS FAR AS I CAN SEE THE ONLY OPTION...
yes we took out this rediclious loan but we took it out against the security of the home... so if we didnt or couldnt pay it we would loose the home... no we cant even loose the home without being screwed for another 100k in ne!!!

we are being fleeced for trying to do the right thing... why didnt we just add our names to the council lists and bum off the goverment, u get nothing but a hard time for trying to make a better life for yourself and your family in this country... would have been better off claiming to be a single parent get free money, free house, free medical card, go on holidays, clothing allowances and go out most weekends!!! as the majority of the so called single mums i know do!!!

sorry for the long post but this is to me prob what my whole life seams to revolve around.. HOW THE HELL ARE WE GONA PAY THE MORGAGE THIS MONTH!!!

why cant ireland do this!!!


The Irish Times - Friday, April 27, 2022
Easing the mortgage debt burden - How Norway handled the problem
In this section »

No easy answers to monumental debt
Living with debt - Two stories

HOUSE PRICES fell by between 50 and 80 per cent in Norway in a property crash that lasted from 1987 to 1993, leaving about 100,000 households in trouble. Few debtors wanted to sell their homes as values had fallen so far that borrowers didn’t want to crystallise losses.

In response to creditors aggressively trying to collect debts, the Norwegian government introduced debt settlement legislation in 1993 to deal with mortgages that homeowners could not afford while at the same time allowing them to stay in their family homes.

The legislation permitted the write-down of mortgages where what was a once secured part of the loan was no longer deemed to be secured as the property had fallen in value and this part of the debt had become unsecured.

The debt was then written down to a level that was slightly higher than the value of the property. So, for example, if a property was worth €300,000 and had fallen to €100,000, the loan on the house would be written down to €110,000 and the €190,000 would be written off over five years.

The legislation aimed to allow indebted borrowers to regain control of their financial affairs and to fulfil their debt obligations as much as they were able to afford.

Borrowers could make an application to an enforcement officer to decide over a period of four months where a voluntary settlement could be reached with creditors without having to go to court.

All creditors had to agree for a debtor to secure a voluntary deal.

If approved, they had to meet a payment plan for five years and then emerged free of all debts that are not effectively secured. If no agreement was reached, a debtor could look for a compulsory settlement imposed by a court.

Egil Rokhaug (left), a senior adviser to the Norwegian government, said between 2,500 and 3,000 mortgages were written down in the early 1990s and the average debt involved was €150,000.

“Voluntary settlements were not very successful in the first years – 50 per cent were voluntary; today it is 90 per cent,” he said. Some proposals were offensive to creditors – debtors’ houses were too big or expensive or the debtors were suggesting to keep a car or a boat or they were out of work and were not asking for work. Now we have 20 years of practice so it is known what creditors will accept or not accept. It wasn’t easy at first for creditors to understand that the state could make an act to take away their loans – there was resistance in the first years.”

About 50,000 people have availed of debt settlement deals since 1993, he said, though this represents less than 1 per cent of the population of Norway so voluntary settlements are not commonplace.

So sorry to hear your situation and well done to you for trying to do the right thing.

I would go back again to the bank and tell them, yes tell them that you have to go on Interest Only for a year or two or negotiate stronger. I have posted on here about some of my Oh's friends negotiating with the Banks and the banks doing deals. They do and they are. It seems though only to the people who refuse to be bullied by them or are able to stand up to them. It seems "He who shouts the loudest" gets better results.

As I am sure you have cut out everything possible, you still have to live and the Banks are going to have to start realising this. You have done your best and if I were you I would go very strongly into the Bank as many have and do leave until you have some agreement that works for you and your Family. You cannot go on living like. This is your primary residence I take it and you have no investment properties either?

lilllebo... no i have no other investments or property... i have taught about going back to them again but i really feel like im just setting myself up for a let down.. that 3mts waiting was terrible... they didnt return calls emails i literly had to go down every day and wait to see the lady i was dealing with ( and wait i did) only to then be told no theres no decision yet... we pushed it n pushed it but they were awful!!!

i mean seriously there answer was to let my husband work every hr that god sends n me to sit at home with no heat, electricity or tv with two small children... thats no life... i dont think i could go through all that again...for what... !!!

Hi Perfection,

I don't want to give you financial advice that is irresponsible so I am going to tell you what I would do not what you should do, just what I would do. Actually, to be fair, what some of my friends have done and this is not OH's buddies who are totally different and owe a lot.

My work Friend has a husband and two kids and she has stopped paying the Capital on her mortgage the day she ran out of petrol on the Motorway and had no money in her account or purse to even buy €5 worth of petrol until pay day. Her Family were suffering and were literally living on nothing to pay the Mortgage whilst the "Big Boys" seem to get away with it.

She is now on interest only for the next 3 years and able to breathe again and live a life. Yes, it's kicking the bucket down the road but in my opinion something has to happen in Ireland. She never went wild and drives an old car and her husband sold his van for €600. He was in construction and lost his job thus not being able to make ends meet. He has gone for countless jobs and will work at anything but he has been unlucky so far.

Anyhow, back to you - you are still thinking in a weak way if you don't mind me saying. GO IN there and tell them that they are getting a certain amount a month and that's it! My friend did. She stopped her direct debits and wrestled with the bank until they agreed to let her go on interest only. At the end of the day they need money just as much as the rest of us.

My OH's best friend went into the Bank recently with the Keys of two of his Houses and they refused to take them off him. They sat down and eventually reached an amicable agreement. Banks don't want 1000's of houses left on their doorsteps.

Take a deep breath and just make the call if this is they way you think you should.

Perfection I totally sympathise with your position and I sincerely hope u get sorted, but this statement got my goat a bit:

we are being fleeced for trying to do the right thing... why didnt we just add our names to the council lists and bum off the goverment, u get nothing but a hard time for trying to make a better life for yourself and your family in this country... would have been better off claiming to be a single parent get free money, free house, free medical card, go on holidays, clothing allowances and go out most weekends!!! as the majority of the so called single mums i know do!!!

That was not the only two options available-buy or scab off the government. Private renting is and always has been an option.

sandyclaws i agree we could have rented... but at the time we wanted a secure future for our family like so many other 20 somethings at the time. didnt want to be uprooted by some landlord when it suited them also it was to be our family home... were we could in time put money into our home... we didnt want to sponge off the goverment we had both worked ft since we were 14 and 16 and eventually we could lave it to our children... so much for that plan

i dont want to live off the goverment... but i also feel sickened by all the social welfare fraud around me... it would have been a much much less stressful root. but these people in banks goverment ect are getting hugh saleries and they didnt do there jobs correctly ie the goverment should have seen this coming but were to tax greedy to stop it.

now it the ordinary people that took that harder root that are suffering because of our greedy goverment... the so called single mothers are just a bit peed off because they cant go out 3 nites a week now!!!
if they seriously cracked down on social welfare fraud ie single mothers(the fake ones) and foreginers under so many different names claiming when they dont even live in this country!!!

perfection wrote:sandyclaws i agree we could have rented... but at the time we wanted a secure future for our family like so many other 20 somethings at the time. didnt want to be uprooted by some landlord when it suited them also it was to be our family home... were we could in time put money into our home... we didnt want to sponge off the goverment we had both worked ft since we were 14 and 16 and eventually we could lave it to our children... so much for that plan

i dont want to live off the goverment... but i also feel sickened by all the social welfare fraud around me... it would have been a much much less stressful root. but these people in banks goverment ect are getting hugh saleries and they didnt do there jobs correctly ie the goverment should have seen this coming but were to tax greedy to stop it.

now it the ordinary people that took that harder root that are suffering because of our greedy goverment... the so called single mothers are just a bit peed off because they cant go out 3 nites a week now!!!
if they seriously cracked down on social welfare fraud ie single mothers(the fake ones) and foreginers under so many different names claiming when they dont even live in this country!!!

Wow. If you're aware of so many cases of SW fraud you should really report them to the local SW office and do all of us a favour. You seem to have a thing about single parents claiming their entitlements bordering on the obsessive. I don't know any parent, single or not, who is complaining that they can't go out three nights I week. I am, however, hearing a lot of people saying they had no choice but to buy an overpriced house which is now in NE. I also don't know anyone who was forced into an estate agent or bank to buy a house at gunpoint, it was always a choice people made. When you're an adult, you make your choices and live with the consequences. Not one person can legitimately say they had no choice but to buy a house. As others have pointed out, renting was and still is an alternative.

Anne Cordelia Shirley wrote:Wow. If you're aware of so many cases of SW fraud you should really report them to the local SW office and do all of us a favour.

+1, if you actually know anyone who is fraudulently claiming social welfare you should do us all a favour and report them.

Other than that I think cancelling the direct debit and setting up a standing order for an amount you afford may be the way to make some progress with the bank

ACS, I agree with a lot of what you have said. But I am sick of listening to the tilt of that "oh well a gun wasn't held to your head" about people making decisions to buy a House or rent. It seems to be dribbled out so fast and with no thought of the person who bought the house at a high price or is suddenly in negative equity. Many people bought their house and were well able to afford the payments and had all this added into their Budget and yes house prices were inflated etc but their means were able to meet this. My Husband was given any mortage he wanted as he was extremely well paid in the same company for a long time. Well above average and as he had worked for them for over 6 years he was well able to repay the mortage and it was never an issue. Of course, until he lost his job and his own company. He did not see this coming, who did? And when he did it was too late.

He worked his way up from early 90's and was never a man for having any type of debt. I think I remember posting that he always has credit on his credit card and still has! He built our House in the middle of the boom and yes of course he was way too positive about this but at the time he was well able to pay the mortgage. He is not a physic and he was not aware the credit crunch firstly was going to happen and as his mentors and also his leaders, the government and indeed the entire world were applauding him and his ilk and they were not able to foresee the downward spiral that happened so fast.

Have we all forgotten the environment that we all lived in at the time? Nobody thought you were insane for buying a house for €300K, they thought you were mad for not doing so!!

All arguments can be made and all justified but lets not forget the fervour and environment that was both contagious and supreme in they HEYDAY. If we are going to suddenly brow beat people for their gullibility or indeed at the time ingenious decisions, depending on how your luck went, lets at least give some benefit and start from the same foundations. Lets not forget already the affect that society, media and all the big influences,that assisted in their decisions.

It's very easy to "poo poo" people choices or decisions now and if we were all able to predict the future I am sure we would have done things differently or indeed as some seems to be able to see the future would have made a lot of money.

Btw, I didn't become involved in the madness as I came home in the middle of it in 2005 and was slightly gobsmacked by it all but I can really see how it all happened.

Very easy to see all the mistakes now and how it all manifested and very easy to critisize until you remember how it affected us all, all, no matter how small. Now, my argument is for the normal person and not for the overindulged and the poultices that have seeped everything.

That's a different argument altogether.