ESRI "People who don't have cancer more vulnerable than those who have cancer already"

Discussion in 'The Fair Mortgage Rates Campaign' started by Brendan Burgess, 12 Mar 2019.

  1. NoRegretsCoyote

    NoRegretsCoyote Frequent Poster

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    This is almost certainly down to the demographics (size of outstanding balance, income of households) of tracker households compared to SVR households, and barely due to the first-round impact of higher rates per se.
     
  2. Brendan Burgess

    Brendan Burgess Founder

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    Absolutely.

    What will drive defaults is the loss of income.

    Not whether tracker rates rise from 1% to 1.5%

    Brendan
     
    NoRegretsCoyote likes this.
  3. Brendan Burgess

    Brendan Burgess Founder

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    Last edited: 12 Mar 2019
    Take an example of Johnny who took out a €300k mortgage in 2006 over 30 years at ECB +1%.

    The ECB rate was 3% so the mortgage rate was 4% .

    Since then he has paid an awful lot less than he was expecting, so he has probably saved a lot of this.

    His mortgage balance today is probably around €200k with 17 years to go at 1% mortgage rate, so his repayments are down to €1,066.

    If the ECB raises the rate from 0% to 2%, which even the ESRI say is unlikely, his repayments will rise to €1,252

    Summary

    upload_2019-3-12_15-14-56.png

    He has probably progressed in his career since then.

    Conclusion: Tracker mortgage holders are not vulnerable.



    Brendan
     
    Last edited: 12 Mar 2019
  4. Bronte

    Bronte Frequent Poster

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    Yes but your graph isn't at all complicated. LOL.
     
  5. Brendan Burgess

    Brendan Burgess Founder

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    Hi Bronte

    Are you suggesting that the ESRI report has more authority than my analysis because of this: :)

    upload_2019-3-12_16-32-44.png
     
  6. Brendan Burgess

    Brendan Burgess Founder

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  7. Bronte

    Bronte Frequent Poster

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    Far be it from me to suggest that such reports are justification of one's jobs.

    Or
    Far be it from
    me to suggest such reports are written in a way so that

    - most ordinary people will not read them
    - most will not understand them
    - most will think it's highfluting stuff that's best left to the experts.

    Would you happen to know what 'laggered level' of anything means.....
     
  8. Brendan Burgess

    Brendan Burgess Founder

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    I think a lagger is a Cork term for a drunk.

    But what they actually refer to is the delay between interest rate rises and when people actually fall into arrears.

    Brendan
     
  9. RETIRED2017

    RETIRED2017 Frequent Poster

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    Last edited: 12 Mar 2019
    Out of interest do you know the % of trackers who defaulted, since 2008,I know of tracker mortgages where the amount advanced even today are higher than they would get after setting off redress and compensation , are still higher than they amount the could borrow as of today,homes may be in positive equity but are just about making full repayments,
     
    Last edited: 12 Mar 2019