"Coalition warns banks: reduce variable rates or face levy hikes"

from the Indo

http://www.independent.ie/business/...riable-rates-or-face-levy-hikes-31153713.html

Banks could be hit with severe levy hikes if they continue to refuse to cut variable mortgage rates for 300,000 customers across the country, the Sunday Independent has leaned.

"All the attention is on the mortgage arrears issue but there is only 30,000 of them, there are 300,000 variable mortgage holders. They are the working poor we talk about," one source said. "The only thing that moves banks is the thought of losing cash."

An additional levy is not the answer. That would be of no help to the borrowers concerned.

The solution is to give the Central Bank the power to control interest rates. That would be a far bigger threat.

Brendan

Brendan,having watched Honohans performance during the darkest days this country has ever faced,I have no doubt that he will do absolutely nothing to reduce interest rates.

SVR mortgage holders will have 300,000 votes in the next election so all political parties are beginning to listen.An additional 150 Million levy is pointless.The Central Bank will reduce rates if it gets the power to do so.

More on this from TheJournal.ie

http://www.thejournal.ie/variable-m...levy-2057215-Apr2015/?utm_source=twitter_self

BANKS ARE TREATING people on variable rate mortgages “very badly” and “shabbily”, Minister Leo Varadkar has said.

Varadkar said the Government is not going to interfere in the commercial decisions of banks, saying “it would be a mistake to do that”.

Despite the report today, he said that there “hasn’t been an official decision or anything like that on the bank levy that I’ve been party to”.

Click to expand...

Another pointless knee jerk response.

There is no competition in the marketplace - because of the word that dare not speak its name - repossessions!

Once again this Sunday we've seen a slew of articles from Politicians and commentators who basically tells is it's a outrage that people who willingly took out mortgages are being asked to pay back their loans.

How much longer are going to delude ourselves that there is a nice, no cost response?

Brendan B has stuck his head above the parapet along with Seamus Coffey et al - and we've seen a few anonymous Moral Hazard people getting coverage but that's it. Even on a financially savvy website people are reluctant to put 2 and 2 together...

Brendan Burgess said:

"All the attention is on the mortgage arrears issue but there is only 30,000 of them, there are 300,000 variable mortgage holders. They are the working poor we talk about," one source said. "The only thing that moves banks is the thought of losing cash."

Click to expand...

The 30,000, many of whom are selective defaulters, have many more advocates on their behalf than the 300,000.

Is it time for the 300,000 to tell the government to stop defending the defaulters?

If the lenders said that they would reduce rates by 1% in return for an increase in their powers to deal with defaulters, I think it would have majority support.

Whether your argument is that a bank levy will be ineffective or whether it's that we're all deluding ourselves about the underlying problem of repossessions it's good to see their is still good traction on this issue.

As a variable rate mortgage prisone... sorry I mean customer of course... I'm heartened to see the issue in the news. And I'm paying attention for the election.

Brendan Burgess said:

The 30,000, many of whom are selective defaulters, have many more advocates on their behalf than the 300,000.

Is it time for the 300,000 to tell the government to stop defending the defaulters?

If the lenders said that they would reduce rates by 1% in return for an increase in their powers to deal with defaulters, I think it would have majority support.

Click to expand...

this is it in a nutshell

Are we the only country in the world who go to such efforts to keep defaulters in homes they probably could never have afforded?Or is the common practice?
I doubt very much that it is.

Reuters have also now just picked up on this story. The more publicity the more pressure gets exerted on the banks.

http://uk.mobile.reuters.com/article/idUKKBN0NA0O320150419?irpc=932

Knuttell said:

Are we the only country in the world who go to such efforts to keep defaulters in homes they probably could never have afforded?Or is the common practice?
I doubt very much that it is.

Click to expand...

We are absolutely unique.

We have ten times the arrears rate as the UK and one tenth the rate of repossessions.

And when I call publicly for repossessions to be facilitated, I am demonised.

Brendan

Brendan Burgess said:

We are absolutely unique.

We have ten times the arrears rate as the UK and one tenth the rate of repossessions.

And when I call publicly for repossessions to be facilitated, I am demonised.

Brendan

Click to expand...

I totally agree. I share your views on above. What is currently going on is ridiculous. The courts and the over hyped headlines in the media about repossessions is beyond ridiculous. There is not one Political Party out there with the moral courage to call it as it is. I suppose the reality for them would be demonisation in the media. The silent majority will keep working and struggling to pay their way while a vocal minority and cute hoors will get the headlines in the media about how hard they have been done by even though they might not have paid a cent towards their mortgage for 5/6/7 years.

Dermot said:

There is not one Political Party out there with the moral courage to call it as it is.

Click to expand...

I wonder why this is so? I suppose if you call for people to be responsible and pay their debts, you get accused of being a friend of the banks. And anyone who is supposedly a friend of the banks must be an enemy of the people.

I am surprised that there isn't one politician who stands up and calls it as it is. The majority of people have paid their mortgage on time. Many who have defaulted have rescheduled and are back on track.

The majority of responsible borrowers are paying for the defaulting minority.

Brendan

I often wondered what the reaction might be if the CEO of one of our main Banks were to publicly state that in return for a more realistic repossession system that they would respond by lowering variable mortgage interest rates . I think one of them should give the lead.

Another reality check is that there are many tens of thousands unemployed.

There are many thousands under paid.

A significant majority have had their income cut and only in particular areas of employment have any pay
increases been granted.

There was devastation in this country , lest we forget, and the time needed for recovery by individuals is longer than that of banks. The ordinary person in a regular job has scant opportunity to improve income and little hope of a rise in income on the horizon. So they are trying to maintain payments on mortgages taken when salaries were at a different level.

How many of those in arrears now were in difficulty in say 2008 . If their income had not been lost/decreased/ravaged by new taxes would they be mortgage defaulters in 2015 ?

Granted there is probably a small cohort who have chosen not to pay but others would have continued to meet their obligations but for the above .

The majority of mortgage holders are decent people who want to pay their way but circumstances alter cases. These circumstances need to be taken on board by lending institutions but unfortunately there is no face to face relationship between lender and borrowers in distress. There are 'call center' types on the end of phones with a line of patter akin to cold callers at the door.

Hi 110

Those of us who are opposed to helping out the strategic defaulters have no objection to helping out the people who are doing their best but who can't meet their full mortgage repayment.

Even if someone has had their income cut, they can pay something towards their mortgage. The problem is that a lot of them, an awful lot of them, are not paying anything. I have argued that there are about 20,000 selective defaulters. My experience surprised even me. People paying nothing for years and not showing up in court.

If someone is paying nothing, then they have no right to claim that the lender is not engaging. If someone is paying whatever they can, and they can't get the bank to engage, I fully support having a solution imposed on both the borrower and the lender.

Brendan

110quests said:

Another reality check is that there are many tens of thousands unemployed.


The majority of mortgage holders are decent people who want to pay their way but circumstances alter cases. These circumstances need to be taken on board by lending institutions but unfortunately there is no face to face relationship between lender and borrowers in distress. There are 'call center' types on the end of phones with a line of patter akin to cold callers at the door.

Click to expand...

Of course, falling behind on your mortgage doesn't make you a bad person, but it doesn't allow you to ignore reality.

the recent rise in house prices shows that there is demand for housing there and there is money chasing property. Is it so wrong that someone whose circumstances have unfortunately changed now moves to a smaller house in a less popular area?
There are people commuting into jobs in Dublin from Mullingar etc who are driving past houses they could not buy during the boom.

It's not good enough to say "this is my family home and I'm staying put" while others live with the choices they made - many others are paying mortgage for Shoebox Apartments or renting unsuitable homes who now have several children. Their circumstances have changed too.

Talk of punishing the banks with a new bank levy is fatuous. Every time a bank levy is introduced, bank charges are hiked to compensate.

Tommy

That is a really good point. An increase in the bank levy might just make matters worse.

And if any bank wanted to bring down its variable mortgage rates, it would be punished by the bank levy anyway.

Brendan