Debt forgiveness: A NAMA for the people?

Debt forgiveness: A NAMA for the people?

Debt forgiveness: A NAMA for the peopleIncreasing numbers of homeowners are struggling to pay off mortgages across the country and negative equity is becoming a major issue for a large segment of Ireland’s population. Many hard-pressed, financially vulnerable homeowners are now caught in a debt trap and it has been estimated by year-end that 350,000 homeowners will be in negative equity. While other economies are slowly coming out of recession, if our homeowner debt situation is not addressed it could greatly hamper our chances of recovery.

On RTE’s Monday night program, “Aftershock: Where to now”, Matt Cooper suggested that the state should step in with a “swap of debt for equity” scheme which is commonly used to rescue companies that get into difficulty, to stop them going bust. “The swap of debt for equity is not pain free for the borrower, as they would lose part ownership of their home but it would make their repayments more manageable.”

He added; “We cannot dismiss people, the citizens of this state, lightly because the public finances and the banks take precedence or because those who have are unwilling to share the pain with those who do not”.

Debt forgiveness: A NAMA for the people?

  • Should the state provide a rescue plan for householders in negative equity?
  • Is this the only solution? And is it a viable solution?
There are 34 comments for this article
  1. water conservation tips at 2:35 pm

    Awesome post, Love it. Keep it up. Thanks again.

  2. Darren at 11:59 am

    To all of those clever people who didn’t buy because they knew the market was inflated and are applalled at the idea of bailing out those of us who over-committed all I can say is that you don’t seem to mind the fact that I paid over €100,000 in stamp duty that you didn’t – do I somehwere have a private fund that is only for my use or has that 100k gone into the state coffers?? what do you think? By the way, I also pay over 60K a year in tax etc – how much do you guys contribute????

  3. Colm Kelly at 1:27 pm

    That should have read…..’unwilling gov’ and ‘parties are incapable’

  4. Colm Kelly at 1:18 pm

    People who are claiming to leave the country if a NAMA for the people is introduced should have said the same thing when the original NAMA got floated out there. There are three categories of Joe Soaps out there:

    1) The regular guy/girl/couple out there that simply wanted to own their own home and live their lives.

    2) The same as above but didn’t allow themselves to be sucked into the market.

    3) The people that ran themselves into the ground by taking out loans recklessly to fund credit fuelled lifestyles way beyond their means.

    Regarding category 2…..total sympathy, they are being punished simply for being Irish.

    Category 3 people really only have themselves to blame but they would probably represent previously high earning people that lived way beyond their means always keeping up with the Jones’

    Category 1 however probably make up the greatest tragedy of this whole mess. People that bought apartments/shoebox 2 bed houses in commuter belt towns simply to get on the ladder. Probably in the hope that they would earn more, sell on and maybe get to live in their home towns or preferred towns rather than some run down neglected and forgotten wasteland. Now they are stuck for the majority of their lives with a debt that will bind them to misery. People with apartments bought for 250k – 300k that are now worth 120k – 150k. People in places like Balbriggan, Lusk, Swords, Navan, Kildare and further afield.

    These people are suffering and see no future. That is the price they are paying for trying to live an Irish life. They didn’t overspend or seek riches, they just bought a home. The banks have been bailed out by an unwilling government while no real protest came about. The same banks that are ruthlessly upping interest rates while dropping deposit rates while telling us that withdrawing your money will lead to a panic and doom the economy. These banks are backed by a government that doesn’t care for it’s people, whether they be category 1, 2 or 3. They look after themselves and their debt peddlers while feeding of the lack of cohession between the regular joe’s of this country.

    Instead of facing a backlash from everyone effected negatively we sit in silence hoping that a saviour will appear from somewhere. This Nama for the people is being condemned by category 2’s. They should eb refusing to pay for the banking Nama rather than the people’s Nama. The banks will continue in some form and will continue to live as before while the citizens of the country pay dearly. We should be helping ourselves for once. Not begrudging a Category one couple the right to a decent life with some hope of a happy future. We should be forcing this corrupt government to backtrack on Nama immediately rather than bicker amongst ourselves. We fall straight into the gov’s hands everytime we bicker. We need to focus all our efforts on change at the top.

    We all see the corruption on a daily basis. The state of our streets, suburbs and our disasterous ‘Northern Quarter’. The country is going down the plug-hole and we all know it but nobody is prepared to stand up and be counted. We all know FF, FG or any of the other incompetent parties are capable of cleaning this mess up. One hundred years ago we had intellectuals and warriors willing to put their lives on the line to win us a country and this is what we’ve allowed our peers to do to it.

    We need to change the way the countries run and we need to help each other out of this mess. Nama is wrong. We all know it. Maybe a people’s Nama is wrong too but I know which I’d prefer to back with my tax dollars.

  5. Dublin Resident at 1:16 pm

    I agree with “ABC”

    “The money that was spent on NAMA would have been better spent on buying 100K (per mortgage) of the ordinary Joe’s mortgages, this could have easily released between €1060 (EBS 10-year fixed) and €560 (EBS 20 year var) per month per household as disposable income into the Irish economy, and the economic multiplier effect that would have on the economy is huge. Instead the government took a huge amount of money OUT of the economy and locked it away in NAMA just to protect a few fat cat bankers.”

    In my humble opinion. All NAMA has done is helped banks so that they can show at the end of the year – their balance sheets are in order. The executives, managers and all the top people working in the banks are STILL getting bonuses.. in way or other.

    Like, ABC, I believe helping ordinary people would have been much better solution. I understand that would make people upset the ones who saved… and who bought houses before the economic boom.. and all the other arguments that have been thrown here..

    But if these people, think for a minute, if the GREEDY INVESTORS or people who wanted to UPGRADE to a BIGGER homes are not helped. they will have to still suffer.. with huge tax bills… fear of unemployment.. increased mortgage rates etc..

    Would it not be better…. if the “greedy” people, instead of being judged….helped with some sort of conditions.. eg.. to not allowed to purchase a home for 3 – 5 years time. Or to not to get Unemployment or other social welfare benefit for a certain period..(because, its people who are unemployed are the ones who are finding hard to meet up the payments)… these are some examples … it should teach people to NOT TO BE GREEDY.. and teach them a lesson.. it should make people .. who are giving out here.. much happier that they were able to punish people for their Greed.. :)) Hopefully, it will make them feel better about themselves … .:))

  6. James Byrne at 10:02 am

    Debt forgiveness: A NAMA for the people?

    I agree with the growing demand/interest to have mortgage holders financially assisted by the STATE.
    After all it was the Government that allowed the banks to give 100% mortgages and sometimes in excess of this amount. It was the planning departments within the government that allowed the builders to purchase farming land and to have it re zoned residential often with the support of brown envelopes.

    It was the Government that collected vast amounts of “Stamp Duty” on the sale of houses/apartments.

    It was the Governments regulator that allowed the banks to breach every compliance rule that existed and for the same regulator to resign with a huge handout and pension.

    Not only are people suffering with mortgage repayments but recently without consideration for people in general, the Governments GREEN party imposed a “Carbon Tax”, which will effect everyone and will add to the cost of transport, bus, train and goods transport.

    I say enough is enough, and that the Government must instruct the banks to do the following:

    Extend the term of mortgages in arrears by 5 years and or

    All troubled mortgages to be Interest Only for a minimum of 5 years at current rates, thus allowing time for the situation to improve

    Government can and must insist with the banks that a solution is found, as the Government have injected BILLIONS into banks and have the right to do this but the question is have the Government to WILL to do so.

    There is no point hoping for a change of Government we need action now.

    Regards

  7. abc at 7:42 am

    MY GOD!!!! I’ve never seen such BULLS**T in all my life.

    So many have made emotive arguments that are thin on facts, “people who bought property which are now in negative equity lied to the banks about their earnings”, Clare says “People were greedy. They were stupid” and then says she poured about €50K down the drain on rent. P.S. Clare you _are_ paying other people’s mortgages, the mortgages of the developers who helped fuck up this country! So go buy your ticket.

    NAMA is going to be a millstone around the necks of the people of Ireland for the next 30 years. What is going to happen is that, in a couple of years when the world wide economy picks up, Ireland will not be able to participate in the recovery because the ordinary people will not have the disposable income to spend on anything (this is waht happened initially in the 80’s), because they will be paying inflated taxes and mortgage rates.

    Income tax take is down, VAT take is down, so what does the government do, increase tax more, sending the whole country into a vicious downward spiral that is very, very hard to get out of.

    The money that was spent on NAMA would have been better spent on buying 100K (per mortgage) of the ordinary Joe’s mortgages, this could have easily released between €1060 (EBS 10-year fixed) and €560 (EBS 20 year var) per month per household as disposable income into the Irish economy, and the economic multiplier effect that would have on the economy is huge. Instead the government took a huge amount of money OUT of the economy and locked it away in NAMA just to protect a few fat cat bankers.

    For perspective, I’m not in negative equity because I bought 12 years ago and have no intention of moving, but I might loose my job in a couple of months because nobody is buying my company’s product. But who’s going to pay my mortgage, medical bills, etc. etc. if I am made unemployed?

    So cop-on to yourselves people, yes there are people out there that believed the “fundamentals of the economy are good” bullshit that we were all fed before the crash and bought property they couldn’t afford, but just ask yourselves, can we afford not to help them? Go figure it out for yourselves.

    Incidentally, negative equity is not a issue for people who bought homes, they are going to stay in them for longer than the mortgage takes to pay, negative equity is only an issue for people who invested in property and there “investment” is now making a loss.

  8. Mike at 6:39 pm

    I think that there should be help for those in trouble, not negative equity, i.e. those in arrears!! I am a renter and didn’t buy into the huge over inflated house prices. Buying a 2 bed apt for €450k…. are you serious??

    I do not agree with the NAMA for home owners for a couple of reasons:
    1) How will the Government pay for this? Through higher taxes paid by home owners, renters, elderly people, minimum wage earners, etc!!
    2) As a renter, I want to be able to save for my own deposit, but if paying higher taxes for a NAMA for home owners will screw this up…. 2 NAMA’s (bank and people).
    3) If people think this bank NAMA is bad…. wait until you see the bill for home owner NAMA and the Pensions NAMA in a few years!!

    And finally, if banks have a NAMA, home owners want a NAMA…. Can I, as a renter, have a NAMA for 2 reasons:
    1) I’m paying my landlords mortgage
    AND
    2) I want to buy my own house too!!

    NAMA for banks, NAMA for people, NAMA for Pensions, NAMA for renters, NAMA for nursing homes fees, NAMA for credit card bills, NAMA for car loans, NAMA for personal loans, can you see the line yet?

  9. chris at 9:03 am

    You have to be kidding right? Property purchasers took a punt and some lost out. Simple as that. Why should we bail them out for their overstretching of their finances? People took mortgages that were too large for their capacity to repay comfortably and now with a bit of economic pressure they find themselves in a hole. It’s tough but that’s life. I don’t see why those who are finished repaying their mortgage, those who have a more realistic mortgage or long term renters should have to shoulder the burden of those who are in financial trouble. It’s sickening enough to have to bail out the banks. A lot of people wanted to live by the Capitalist sword, but it seems there’s a lot of people who aren’t willing to die by the sword.

  10. Tom at 7:13 am

    Bail outs? It’s a free market which means those rules apply. As with many other posters I didn’t buy during the boom as there was no correlation between mortgages being offered by banks and house prices and more importantly a complete disregard of the notion that there is a link between rental yield and house value.
    The government needs to focus on helping the poorest in society – which may include people who have lost their houses – but there should abdolutely not be any direct association with negative equity. If people are unwilling to carry out basic sums when making the biggest purchase of their lives they need to be asking themselves serious questions. There are clearly plenty of sensible people out there – why should they have to bail out those who were financialy inept? Certainly the govt and banks had a big role to play but at the end of the day we are all adults and free to choose how we spend our money.

  11. Laura A at 4:49 am

    What does negative equity have to do with not being able to make your mortgage payment? Does the article writer not know the meaning of the term negative equity? Banks do not reposess homes that are in negative equity; they reposess homes for which buyers fail to make payments. People would only face negative equity if they sold the homes in which they are living. If I owned a home in negative equity I would just continue to make the mortgage payments, enjoy the home I purchased, and hopefully learn a lesson not to buy in over inflated times. Face it, most homes (other than homes people have owned for donkeys years or old council homes) if sold now would be in negative equity. But that has absolutely nothing to do with being forclosed upon or reposessed. You will only realize negative equity if you sell your house. The people saying they should be bailed out because their houses are in negative equity are living in a dream world. I too would loudly protest such a move. I’m sorry but if you have huge mortgage payments and can’t afford them that is your personal problem, not mine. But don’t use negative equity as some smoke screen to get a relief from a mortgage you could ill afford but took out anyway to keep up with the false rich of Ireland. Nobody made you pay the price you did. Nobody made you take out mortgages you could ill afford. Each of us are responsible for our own decisions, good or bad.But please stop the whinging nonsense that just because your house is worth less than you paid you should be bailed out. Make your mortgage payments that you agreed to and you won’t have any problem and worry about negative equity when you someday sell your house.

  12. Christian Higgins at 7:19 pm

    The mortgage safe guards that existed in the past of 2 times a persons salary and 1.5 times a spouses salary should have been kept in place. The removal of the deposit and offering 100% mortgages would not have been too bad if the multiplier of the salaries had been more realistic. Of course there will be reckless lending when there are bonuses related to the amount of money that is loaned out. Its not that anyone wanted to be dug out, but when people see the banks being dug out it seems like a double standard. It is a misappropriation of public money.Sure, people should be responsible for what they take on financially, but the banks surely owed a duty of care to their clients not to lend them 15 times their annual salary. Pure reckless, all it did was drive up the price of property that would have remained at a lower, more affordable price otherwise

  13. Stephen Kelly at 4:39 pm

    If house prices had not crashed (as it seems a lot of people believed), but had continued to rise or at least leveled off, most of the people who had not bought ‘in time’ because they chose not would find themselves unable to ever buy because the prices would be too high. The same goes for the future generations who were too young to even get to make the choice.
    So, if that had happened, would all those people who had bought ‘in time’ and were sitting happily in their plush apartments / town houses / three-bed semis / etc. be now clamouring to subsidise the unfortunates who couldn’t buy? Honestly?!!

    The best approach now would be to change the law as it pertains to bankruptcy. Allow people to give the houses they cannot afford back to the banks, go into bankruptcy, accept the consequences of their bad, ill-informed and in many cases plain stupid decisions and move on with their lives in the new reality.

    Incidentally, I find it hard to believe there are people genuinely proposing multi-generational mortgages!! Why should children be burdened with the debts of their parents for decisions they had no part in? Get real!!!

  14. Paul at 3:49 pm

    No Bail Outs – let the system take its course. Water finds it own level. The more pain now – the quicker we recover

  15. Gylan at 3:22 pm

    I believe a bail out for those in negative equity and who were encouraged to buy by the government in the boom years should be given a bailout. I bought an apartment in 2006 and am now in negative equity to the tune of 150k plus. I did not exagerate my income, I did not overspend,I have no overdraft, no credit card debt, no loans and I actually save most of my income and thought that if I did not get on the property ladder then I never would. The concept of house prices falling never crossed my mind and I thought that I would be able to buy a house after a few years however now I am likely to be stuck in a samll two bed for years to come. If I’d had enough money to buy a house at the time at least it would be somewhere I could live in the long term and I would not be so concerned about negative equity. Really its a problem that needs to be addressed for mostly apartment owners.

  16. John Kelly at 2:56 pm

    In the rush to get on the “property ladder” during the Celtic Tiger years many people allowed the banks to inflate their earnings in order to secure a bigger mortgage – many of these mortgages were not properly “stress tested” in order to acertain the effect of reduced earnings or job loss by one of the partners. This flew in the face of best practice and flaunted the guidelines set out by the regulators and both parties were complicit in the deception. Scroll forward a couple of years and the banks have crashed and burned but had the comfort of massive financial support from the government and large pensions for the fat cats who oversay this decline into madness. Meanwhile the average Joe and Josephine Soaps of this world have been left high and dry, living in unfinished building sites with badly built houses which they can’t afford to live in and can’t afford to sell. So what to do – I agree with many of the posters here who say they have made their beds and no must lie in them (in their badly insulated bedrooms) but what if all these people default on their loans and get evicted from their homes? They will require housing and will turn to the government – they may already be receiving unemployment benefit, family income support and now we will have to fund rent allowances through our taxes too. It would be better all round if the government implemented some form of guidelines to mortgage providers outlining new methods of repayment such as extending the loan period (for generations if necessary)part rental part repayment schemes etc. Give these people a break many have lost their jobs, their dignity and their self esteem – don’t take their home away too.

  17. ZZ at 2:39 pm

    As many have pointed out, and I am in agreement with Clare. I as well looked at a house at the height of the boom, and could not for the life of me figure out how people were paying or going to pay these crazy mortgages.

    So as Clare did, I didn’t buy, and don’t think we should have to pay for the foolishness of others who were stretched to pay in the beginning. Furthermore, if you had looked at the payments people were expected to pay, then if there were any risks of a wage going away, they would loose it all.

    A friend told me he owned 2 houses and the bankers wanted to give him 3 times what he could afford….he turned them down and was not gullible, but the point is others did not, and got themselves in that situation. We those who thought through those payments realized we could not afford it, and should not have to pay for those who make that mistake.

  18. Aiden O’Byrne at 2:33 pm

    What next? The banks can own part of my Motorboat on the Shannon that I bought with the re-mortgage on my 3-bed in Blanch? McWilliams is a populist non-sensical tosser. Anybody who made the decision to buy something without the wherewithall to pay for it is as foolish as the bank that loaned them the dough.

  19. Sam at 2:30 pm

    There should absolutely not be a bail out/nama for people who were stupid enough to buy property they couldn’t afford in the boom time. Anyone with half a brain could see that property prices in Ireland, particularly Dublin, were absolutely ridiculous. The government, landowners, planners, developers, banks certainly were at fault. But people who bought are not blameless – they’re adults with their own free will and their own knowledge of their finances.
    Why should people who saved their money and paid high rents in boom time and still are not on the property ladder be forced to bail out these people. I for one will leave Ireland rather than prop up another section of the fallout from the inevitable property crash , which by the way I’ve been waiting for for 10 years, so I can finally afford a home.

  20. x at 2:25 pm

    Both my wife and I have been unemployed for almost two years, we have now run out of cash, cannot pay mortgages and because we were self employed we cannot get social welfare.

  21. alison at 1:44 pm

    Should the state provide a rescue plan for householders in negative equity?
    I think something should be set up to help people in arrears, at risk of loosing their homes or struggling with mortgage repayments.
    I am in same situation of negative equity. I borrowed a lot less then the bank were offering me at the time. I wanted to own my house rather than rent as was expecting a baby and needed the extra security of having my own home. It’s only a very small 3 bed semi so we werent outdoing ourselves or being lavish!!

    I had bought with my partner who is since out of work and we cant see our way out of this huge mortgage debt over our heads. If we sell we’ll still be €100k short of the mortgage. So no choice to stay where because cost of renting plus paying back what we’d still owed the bank would be more expensive!
    If i could hand the house back to the bank i would!!! so if the bank wanted to part own it i wouldnt care at all if it would reduce my repayments!!

  22. kate o reilly at 1:41 pm

    Is NAMa truely going after the developers/ builders who pushed up the prices on houses that are truely not worth what people paid.
    The government had a part to play in this but are they answerable. Also those who spent way beyond their means are also answerable. So yes something needs to be put in place. Is it fair for the individual not to be bailed out. Nama is bailing out the developers why not the overstretched house owner. One thing i will say . Provisions need to be put in place to never allow this to happen again . and those who brought Ireland to its knees need to be brought to justice…..

  23. Paula Clare at 1:36 pm

    Reviewing some of the comments posted.I am dismayed with the attitudes of some people such as the posting by Clare”f I have to pay to supplement other people’s mortgages, I’ll leave Ireland” Lets be honest and look at the facts you are happy to pay to bail out the Banks with NAMA????I have a mortgage, kids, I work every hour god sends to keep my payments up and I am one of the lucky ones!What about the normal Joe- Soap with the normal house who HAD a normal job! Do you think he is planning fancy holidays and shopping trips to New York!We are a nation of moaners and be-grudger’s.Once again getting back to Clare’s comments-Just because YOU were clever enough does not mean everyone else in Ireland has the understanding of what a Mortgage really is.There are people who can’t even read or write still today.So what about them, what about the people who relied on the Professional to advise them.Can they take action against the banks for Professional Negligence??? Not likely!Are they to be penalised for not being clever enough?Where is social responsibility gone to?Where is the nation who stood up for injustice gone to?Bailing people out would not make me leave Ireland but the attitudes of SOME Irish people would!

    • Chris at 7:38 pm

      Totally agree with you Paula. We Irish are natural begrudgers. Clare seems to think that she was smart to have rented (making a landlord wealthy while she retains no personal assets at the end of it) while people who wished to buy had no choice but to take out an oversized mortgage to buy what should be a necessity to life. She doesn’t want to subsidise any person who is at the risk of losing their house while seemingly has no problem with bailing out the banks, developers and other unscrupulous people who were involved in the making of the bubble that just burst… Does she not realise that if she does not help these same people who are in difficulties with paying their mortgage, she will still end up subsidising them when they are rehoused in council homes on cheap rent or given greater amounts of mortgage interest relief by our government?

      As for Sean’s comments on negative equity, it does still play a part in the overall consequence of the loan agreement as someone would have bought a house at say 300,000. The house is now worth 220,000. They have 30,000 paid which means without interest payments the amount owed is 270,000. If the bank were able to sell that house after evicting the mortgaged person(s) from it and sell it for 220,000, that same person would still be liable for the 50,000 outstanding on the loan, plus interest, and would still be homeless and either at the mercy of local housing authorities or relatives, or worse, paying rent to a landlord while arranging repayments on the outstanding mortgage.

      I agree with Tony wholeheartedly. Releasing private pensions would alleviate the burden for those with pensions set up as the investment companies are not exactly doing a great job with your money anyway. Frontline was saying that over 30% of the value of private pensions have been lost since 2008 anyway.

      If people are evicted and forced to repay outstanding loan amounts we are going to see another mass emigration of brain power and tax payers out of this country yet again. If the banks were to take some of the equity of your house they would still have assets to sell you on after you’ve completed the term of your reduced mortgage. If they evict you and you emigrate with an outstanding loan over your head, the bank will not only make less on the sale of your house after eviction, but they’ll end up having to write off what you owe anyway.

      Seeing as we’ve already put up our tax money to save them, it would only be ethical for them to save those hard pressed homeowners that are in need of their help.

      And begrudgers should always ask themselves, would they like this help if they were in that same situation. Remember renters, there’s nothing stopping a bank reposessing your landlords home and making you homeless too…

    • dub_girl at 9:34 pm

      Hi, to all those who have no sympathy for people who bought “properties” for investment.
      I had a 3 bed semi-detached and wanted to INVEST my money in something solid for my children. ALL professionals were advising the property investment. Myself and the husband had VERY good job – we were able to make payments and bought an apartment for investment and soon after bought another “SMALL” home for us to move in giving us 3 properties in total. We were happy in the knowledge that our kids will be well looked after. We were NOT being greedy – we knew now we can ENJOY our life and I could work part time to spend some quality time with my kids.

      Property bubble bursted – construction workers unemployed – just like my husband. Now he is working part time in the evenings – we are getting half the rent – another baby on the way – my wages minus 20% of what they were 3 years ago. So, am I GREEDY:? I LISTENED TO BANKERS AND FINANCIAL ADVISERS. I wanted a safe future for myself and my kids. Govt. helping Banks – who is going to help me? I havent been on holidays for 2 years and with a bank balance of less than 100 euros end of each month. I dont have time to spend with my kids. I cannot sell my Investment properties due to negative equity and I am paying 20% of each investment propety mortgage – THIS WAS NOT MY PLAN – life sucks – you dont need other people to tell that you were made a fool by professionals

  24. Conor O’Brien at 12:56 pm

    I would sympathise with anyone at risk of losing their home especially if negative equity means they’ll carry a debt with them that eliminates any hope of ever getting back on the property ladder but if they used their home as an investment and eliminated the equity they had accrued prior to the crash with bad financial moves such as remortgaging for new cars, holidays etc then the rest of us shouldn’t have to foot the bill.

    • Grainne at 2:11 pm

      I agree with Clare and Kate. I too could have adjusted figures to yield the maximum mortgage from banks in order to buy over-priced houses, but I didn’t. Nonetheless, I do feel a degree of sympathy for people who felt compelled, either for social or personal reasons, to purchase over-inflated property.

  25. Clare at 12:46 pm

    If I have to pay to supplement other people’s mortgages, I’ll leave Ireland.

    I could have bought at the height of the boom too. I was offered a mortgage about 6 times my salary. I could have accepted, but anyone who bothered to do an hour’s research into advice about how much you should borrow for your home would have walked away from such a ludicrous offer. People were greedy. They were stupid. But why should I pay for their stupidity and negligence?. I’ve been paying over priced rent for the past 6 or 7 years because I couldn’t see any alternative. There was no alternative. The mortgages and houses on offer were so far beyond what one person could comfortably repay in a lifetime, that as much as I would have loved my own home, I had to pour about €50,000 down the drain on rent instead. Who’s going to bail me out for being sensible?

    No way will I help bail out people who are living in their dream homes because of stupidity, while I continue to rent because I was cautious enough to walk away from massively overpriced housing and turn down the money the banks wanted to throw at me. This is one step too far for me. I’ll take my skills and the taxes I pay elsewhere thank you. Perhaps, somewhere that careful and bright people are actually rewarded, not punished. I really hope the people who ran our country into the ground get what they deserve in life.

  26. TONY O’BRIEN at 12:19 pm

    2 IDEAS :

    1/ALLOW PERSONAL PENSIONS TO BE RELEASED AND USED AGAINST HOME MORTGAGE.THIS WOULD ALLEVIATE SOME OF THE
    SHORTFALL IN EQUITY AND DECREASE REPAYMENTS.INCREASE STATE PENSION TO COMPENSATE HOMEOWNERS.

    2/ALLOW MORTGAGE REPAYMENTS TO MADE OVER 2 OR 3 GENERATIONS.THIS HAS A BENEFIT BOTH TO HOMEOWNER AND FINANCIAL INSTITUTION IN THAT THE REPAYMENTS ARE LOWER FOR THE HOMEOWNER AND THE BANK ACHIEVES MORE INTEREST IN THE LONG TERM.

  27. Sean at 12:16 pm

    Negative equity is a term that keeps being used in the context of people being in trouble but negative equity isn’t necessarily a big problem as such. Many people, myself included, are in negative equity but that doesn’t mean that we risk losing our house. Losing a home is a big problem but negative equity is only a paper thing. It is important to differentiate between negative equity and being at risk of losing your house. They are different concepts.

    In terms of the need for help, every time an intelligent argument was put forward to warn of a property bubble, the government and vested interest groups ridiculed the argument so of course some people were tricked into huge mortgages. Therefore I have sympathy for people who listened and have now ended up with huge mortgages and diminishing wages. If some of these people are struggling to pay their mortgages and are running the risk of losing their home, I believe the government should help. The government can help the banks with our money so, having tricked us, why not help us with our money.

    That said, negative equity should not be a factor when determining who needs help. Negative equity is merely a cosmetic thing unless there is a desire to sell. If someone is selling to downsize as a result of a crippling mortgage, then I think the government should help. The help should be because they cannot afford the huge mortgage they were encouraged to take out by the government and not because of negative equity.

    There is another category of people too and I have no sympathy for them. These are the people who bought second and more properties and boasted about their wealth whenever you met them. There is no need for the State to help this category of people. They contributed more than their fair share to the mess we are in so let them lie in the bed they created. Besides, the properties they stand to lose are not their primary residence.

  28. Tom Firth at 11:59 am

    Yes the Goverment should provide a rescue plan for home owners with negative equity as they are responsible along with the banks for the present situation , no matter how much they deny the fact !!!
    The government ministers responsible should also be kicked out of office !!!!

  29. Kate Doherty at 11:59 am

    I don’t think there should be a bail out for all those in difficulty. I for one when I bought my house was being offered a lot more from the bank but when I crunched the numbers for myself I knew that I would not be able to do anything else apart from pay my mortgage. I wanted to be able to change my car, go on holiday, buy everyday things. I took 18 months to do up my house as I could afford it and not borrowed for it. I was not buying every gadget needed just what I could afford. I have a secure job and did not squander money some of these people did. I think they need to be thought how to budget properly as some of them are still spending on unnecessaries.

    • Seamus Gleeson at 1:08 pm

      I don’t believe it is appropriate to simply provide a blanket bail out in every instance.Many people who bought property which are now in negative equity lied to the banks about their earnings,about potential commission,expenses etc and produced false paperwork to give the banks the impression that they could afford these over inflated prices.Each case needs to be viewed on a case by case basis.For example,some people who bought their house or apartment when they were single may now be in negative equity but have since gotten married and had kids.These people cannot sell their homes because of the drop in price so they should have the option of renting out their property and rent a more suitable property for their growing family WITHOUT being treated as an investor i.e.having to pay tax on rental income even though the rent desn’t cover their mortgages,cost of letting,furnishing etc.

      This will create more demand for rental property and a better environment for children to grow – let the singletons/more mature people rent apartments which many are quite happy to do

  30. Tom Firth at 11:56 am

    Having been sold an endowment policy many years ago I owed around €8,000 on my home . My solution was to go to the Credit Union who arranged the original Mortgage . They arranged a loan to pay off the shortfall at very reasonable rates . Was this a better option ? I think so !

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