Defaulting on mortgage

P

Palabra

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I read with interest the previous posts re “defaulting on mortgage” (ecstatic)

I’m in a somewhat similar frame of mind.

I’m 54 now. I bought a house in 2007 for 310K. I got a mortgage of 280K. My thinking at the time was if the worst comes to the worst, I can always sell it and at least get my money back. Remember I’m in my 50s. All of my adult life the sensible thing to do was to buy property.

I now find myself in a position where a bank expects me to spend the next 16 years of my life (if I live that long) helping to clean up a mess that they created? Let’s be clear about it. These people are responsible for this mess. All I did was buy a house.

Why should I (and many more like me) have to pay for the reckless, irresponsible, greedy even criminal behaviour of the lending institutions? While at the same time the government (read taxpayer) bales them out.

I can just afford to pay my mortgage, but my thinking more and more is why the hell I should I? My belief is that it’s going to take a generation for this mess to sort itself out. I don’t have the time to wait for prices to come back. I’m never even going to break even on this house.

I’ve taken my hit on this house. Between the deposit, fees, furnishings, extra mortgage payments it’s already cost me 60/70k buying verses renting. I had to work bloody hard for that money. Now it’s the banks turn to take a hit.

My mortgage is about 2K a month; because I’m separated I get very little mortgage relief. I could rent for about 600/700 PM. and get tax relief on that. Renting would save me a minimum of 150k over the next 10 years.

I’m thinking its worth taking them on for 150k.




 
The bank isn't responsible for your situation...you are. They didn't force you to buy the property. That's the bottom line. If this was the US you could happily do what you're proposing. However in this country non recourse lending of this kind doesn't exist for home mortgages...there's no "jingle mail" although I'm sure many people wish there was.
 
Let’s be clear about it. These people are responsible for this mess. All I did was buy a house.

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Funny !!! It's comments like that, that make me very very cross.... No one made you buy the house. Yes, there are alot of questions that need to be asked of the banks however it's got nothing to do with you buying a house and now deciding you don't/can't pay for it.
 
What I understood from the OP's post was that they were aggrieved at having to pay for other people's mistakes
I now find myself in a position where a bank expects me to spend the next 16 years of my life (if I live that long) helping to clean up a mess that they created?
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I too am pretty angry at the way this country has been run during and after the bubble, and do not relish the thought of paying for others' mistakes.

Why aren't there new banks being set up?
 
Maybe I am missing something here but how is paying our loans back cleaning up others mistakes. Now I can see why we would be annoyed about taxes etc... but loans... if we were happy to take the money now we have to pay.
 
My point is we were conned.

No normal sane person would have bought a property if they knew half of what these bozos were up to behind the scenes.

I was led to believe to expect certain things from the banking institutions e.g. due diligence in their affairs, competency, even a certain amount of honesty?

How ironic these clowns now get to stand in judgement of my credit rating.

The really sad thing is it will happen again. They have gotten away with it(and in many cases have been richly rewarded)

Human nature being what it is, if you get away with something why not try it again.
 
Who conned you into taking out this mortgage? You borrowed knowing full well what had to be paid back. I can apreciate you are angry at the situation that we have all found ourselves in. But get over yourself, if things were still on the up you would not be complaining...
 
Palabra, what I really don't understand is yourself and others whinging about the bad times, bad banks and looking for the easy way out.
Let me tell you how I see it. I am a foreign national and when I came to Ireland some time ago, I was treated like a lesser being because I was not a part of the great Celtic tiger. I saw people rushing to shops and buying huge and overpriced plasma TVs without even looking at the price tag - the more expensive the better. And when the credit card was maxed, they got another one and then headed to the bank for a loan to buy another holiday in Spain, another plasma TV and smirked at me buying my groceries in Lidl because they could afford M&S and dine out and never cook anything in their life. When I asked them how they are going to pay their loans they smirked again and told me I can't understand the miracles of the booming economy because I'm too stupid.
There were enough warning signs in 2007 and enough people who said that an economy cannot function on consume, loans and construction industry permanently.
The same people who were spending like there was no tomorrow are now blaming everybody else but themselves for their decisions. Yes, the banks were handing out mortgages and loans but they were not forcing anybody to take them. I cannot remember anybody telling me, the bank was holding me hostage till I signed the car loan which was too expensive.
It was your own decision to purchase the property - own up to it. Take responsibility for your own actions, you are a grown-up boy and should be able to do so.
I pay my taxes in this country, my own private insurance, never used any social benefit in this country to finance my family abroad and in all honesty, people who do not own up to their own actions and blame everybody else plus always look for the easy way out thus adding to the burden of honest tax-payers simply make me sick.

P.S. Sorry for the rant but there comes a time when enough is enough.
 
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Palabra said:
All of my adult life the sensible thing to do was to buy property.
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What rule book are you reading from? You're an Adult, you need to be take it into your own hands and not apply 'Everyone else was doing it...'

I now find myself in a position where a bank expects me to spend the next 16 years of my life (if I live that long) helping to clean up a mess that they created?

Let’s be clear about it. These people are responsible for this mess. All I did was buy a house.
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People buying at over inflated prices contributed to this too.

Why should I (and many more like me) have to pay for the reckless, irresponsible, greedy even criminal behaviour of the lending institutions? While at the same time the government (read taxpayer) bales them out.
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It's people like you defaulting on loans when you state you can pay them back that has the banks losing the money they lent out. Yes they were part of the cause, but doing this isn't part of the solution. Why the hell should I pay for you to throw responsibility out the window?

I can just afford to pay my mortgage, but my thinking more and more is why the hell I should I?
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Because your not 5, your 54.

My belief is that it’s going to take a generation for this mess to sort itself out. I don’t have the time to wait for prices to come back. I’m never even going to break even on this house.

I've taken my hit on this house.
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At your age, surely you were buying a home? It was a bad choice at your age buying something that you intended to sell.

We're all in this mess. Wasting time blaming people isn't going to get us out quicker.

It you want a better world, get busy in your own little corner.
 
John Rambo said:
The bank isn't responsible for your situation...you are. They didn't force you to buy the property. That's the bottom line. If this was the US you could happily do what you're proposing. However in this country non recourse lending of this kind doesn't exist for home mortgages...there's no "jingle mail" although I'm sure many people wish there was.
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You'de better start believing that there is "jingle mail". An Indian colleague of mine bought a house in Kinnegad, 6 years ago. Over the course of the next 4 years he applied for 3 mortgage top-ups on that same property and in the process bought 3 or 4 properties back in India. At the start of last year he sent his wife and two children back to India while he sat around waiting for a generous redundacy package. With 60K in his pocket he's now laughing somewhere in India at those thick Irish paddies.....and the chances of AIB finding him in India are about zero.
 
haminka1 said:
Palabra, what I really don't understand is yourself and others whinging about the bad times, bad banks and looking for the easy way out......
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I could not agree more with everything you say. It is extemely common human beahiour that we are seeing now.
I can't count the amount of friends and colleagues I heard saying things like: "I made such a great decision 'investing' in these two houses, and my pension investment is doing so great as well, I got a new BMW from a re-mortgaged investment property, I'm an absolute genious at investing in the right things."
The same people are now blaming everyone but themselves for the debts they can no longer service. This is very common human behaviour, its your own good doing when things go well, but it couldn't possibly be your fault when things go wrong.

To the OP: pay back what you owe, if you don't the rest of us will have to, unless you convince the government to do the right thing and let these banks go bankrupt.
 
I'm confused by the OPs position. Let's suppose for a second (wishful thinking I know) that the crash never happened. He would still have paid 280k, still put another 60k into the house and would still have to pay back the loan. The crash had nothing to do with the fact that the loan still had to be paid back. Ok, so the property is in negative equity, that's actually irrelavant unless he is going to sell the house.

Basically what he is saying here is that it would have been cheaper in the long term to have rented and not bought the house. That's not the banks fault, that's his own fault for not doing his maths in the first place. No one forced him to buy and at his age, you'd think he'd grow up and take responsibility for his own actions
 
haminka1 said:
Palabra, what I really don't understand is yourself and others whinging about the bad times, bad banks and looking for the easy way out.
Let me tell you how I see it. I am a foreign national and when I came to Ireland some time ago, I was treated like a lesser being because I was not a part of the great Celtic tiger. I saw people rushing to shops and buying huge and overpriced plasma TVs without even looking at the price tag - the more expensive the better. And when the credit card was maxed, they got another one and then headed to the bank for a loan to buy another holiday in Spain, another plasma TV and smirked at me buying my groceries in Lidl because they could afford M&S and dine out and never cook anything in their life. When I asked them how they are going to pay their loans they smirked again and told me I can't understand the miracles of the booming economy because I'm too stupid.
There were enough warning signs in 2007 and enough people who said that an economy cannot function on consume, loans and construction industry permanently.
The same people who were spending like there was no tomorrow are now blaming everybody else but themselves for their decisions. Yes, the banks were handing out mortgages and loans but they were not forcing anybody to take them. I cannot remember anybody telling me, the bank was holding me hostage till I signed the car loan which was too expensive.
It was your own decision to purchase the property - own up to it. Take responsibility for your own actions, you are a grown-up boy and should be able to do so.
I pay my taxes in this country, my own private insurance, never used any social benefit in this country to finance my family abroad and in all honesty, people who do not own up to their own actions and blame everybody else plus always look for the easy way out thus adding to the burden of honest tax-payers simply make me sick.

P.S. Sorry for the rant but there comes a time when enough is enough.
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Excellent post
 
Palabra said:
No normal sane person would have bought a property if they knew half of what these bozos were up to behind the scenes.
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I thought it was blindingly obvious we were in a property bubble, hence I didn't buy a house.

If you had of done some basic research before making your purchase you would have come to the same conclusion.

It sounds like you only bought your home as an investment, otherwise you would have no problem paying your mortgage and living in your home as normal.

I'm sorry, but you have no one to blame but yourself.
 
This situation is not as clearcut as many people on this thread claim. Some people have choices and decisions to make, e.g. A friend of mine bought a house with her partner three years ago. They have two children, they have since split up with the father contributing nothing. He has lost his job and is seriously depressed and barely functioning.

My friend is left trying to pay a large mortgage and raise her children and it is really getting her down. She is constantly behind in her bills, afraid answering the phone in case it is a debt collector. The stress of it all is having a terrible effect on her mental health. The children miss their father and she feels she is not giving the support and care that her children need and are suffering as a consequence.

At the moment she is paying much more in a mortgage that she would renting and she is seriously considering handing the keys back to the bank mostly for the sake of the children. If she does she will have almost 1000 extra a month to live on and not be living with the constant stress of wondering where the money to pay the mortgage, phone bill etc. is coming from. She has gone to Mabs and they have been a help but she is not coping well.

Who could blame her if she defaulted on her mortgage and told the bank they can have the house? I know I wouldn't
 
You might feel conned but you were not. You were fully complicit in the whole affair, believing whatever bull you heard.

I didn't buy so why should I have to pay for your stupid mistake?

At the moment she is paying much more in a mortgage that she would renting and she is seriously considering handing the keys back to the bank mostly for the sake of the children. If she does she will have almost 1000 extra a month to live on and not be living with the constant stress of wondering where the money to pay the mortgage, phone bill etc. is coming from. She has gone to Mabs and they have been a help but she is not coping well.
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Your friend will end up paying for defaulting dearly. Could be 200K over her lifetime (legal fees, payments, clearing any neg equity after the bank firesales her house for 120K). There is no way out, she made the big decisions about partners and purchasing somethign massive like a house. She and her family now have to live with the consequences.
 
Has anyone got any sypmathy for Palabra? I like the way the media has conditioned you all, yes you heard me, conditioned you all. And an all out asault on one person in their 50s. (foreign national, how do you know its a man?) He's expressing his views on the fact that the banks didn't give a toss about a)he/she was in their 50s and b)knew quite well that this was THE HIGHEST RISK client. The banks were giving money out to people who THEY KNEW COULD NOT PAY IT BACK. And where was the regulator? Catching a few zzzz's. When peoples homes become comodities and investments then there is going to be a lot resentment when its taken from them. Its is a basic necessity of life. The banks CANNOT loose. If you dont pay the mortgage, they take your deosit, whatever payments, the contents and guess what.... they get the house back too, only to pass it onto some other sucker who they know will hope NEVER owns it either. So now they have a house, money and stuff. When you default on your payments say after 15 years of paying a morgage of 30 years then effectivly you have been working for the bank. Not only have you sacrificed your work career but also your acedemic one too. You go to school to learn to do a job to pay for something that is taken away from you. Its not each other we should be turning against. The monetary system is corrupt, it always has been. Money is debt, debt is money. That system needs to fail. Its only there as long as people have faith in that system. I think you should reconsider this before you decide to laugh in the face of a 50 year old who might be thrown out onto the streets and blame him for wanting a home because thats the only crime I see him/her guilty of.
The bankers are the cause of all this, let there be no bones about it. That was their game plan. To do everything in their power to make you never own an asset as valuable as your home becasue money is only a concept. Its worthless paper and its only worth what the central banks tell you its worth so theres no even point withdrawing all your money as you could find yourself next year paying 30euros for a pint of milk. Bankers are the problem not Palabra.
 
What is the consequences of defaulting on your mortgage.

You get a bad credit rating but really that won't matter and can not borrow for the rest of life.

People say the rest of us have to pick up the tab..but we will for the rest of lives be picking up the tab of the current bad bank debts ... then our children will be still serving those debts.

Is it time that we just said the country is bankrupt.. and start over again.
 
Mpsox said:
I'm confused by the OPs position. Let's suppose for a second (wishful thinking I know) that the crash never happened.
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The only different is that he would have been paying more because of the higher interest rates.
 
The bankers are the cause of all this, let there be no bones about it. That was their game plan
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Their motive was to make profit and the OP should have known this. Their motive certainly wasn't to have somebody default on their mortgage and lose money, requring a govt. bailout to survive.

The people to blame in this are the bankers, estate agents and developers in their reckless pursuit of money. The government for supporting this and relying on the property taxes. And finally to every individual who bought property that was clearly overpriced thus making it impossible for sane people like myself to own my own home.
 
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