Frontline programme on mortgage arrears and negative equity

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My 100,000 Ferrari is now only worth 50,000 if I waited I could've had 50k to spend ona better lifestle, education, retirement!

If people were happy to spend the 1400 a month now, and since only talking about negative equity, are still able to pay it, about what are the complaining.

On the other side, people who can afford to take their negative equity should equally be allowed to move if they can still afford their mortgages. This is the other side of the same coin above, negative equity doesnt actually matter, if you can afford to pay it you should, and if you can trade up/down and carry it, thats fine too.
 

I thought about both of these options yesterday and IMO they should really be considered.
 
Bill Clinton talks about the problem of debt, but if we had the recession without the drop in house prices, we would still have the same amount of debt.
The only difference negative equity makes is that people that want to sell their house for whatever reason cannot do so.
I've no problem with the government/banks helping people in this situation if possible, but a blanket debt write-off would just open a huge can of worms.
 
Brendan,

I love how you think the banks are being so helpfull in assessing the borrowers situation and helping them out by reducing their repayments for a term but you do know that while they are on the reduced repayments their capital debt is increasing with every passing month making a bad situation even worse? How on earth is this helping? It's kicking the can down the road until eventually 1000's of families are homeless and saddled with unsustainable debt, that is not good for society, mental health, the governement whom will have even higher social welfare bills, the domestice economy - ie. small and medium sized businesses nor will it be good for the banks (that we bailed out for their recklessness) as they will never get anything back nor will they have deposits. Why not see what is in front of us and deal with the obvious problem and introduce debt forgiveness? I understand if you yourself are not one of the people whom was fooled into getting onto hte property ladder but hind sight is great and if we all had it in our fore sight well then i wouldn't be posting this, would i? But we don't and we need to deal with the problem before it escalates out of control like the property bubble did. Have we learned nothing????
 
Brendan,

you do know that while they are on the reduced repayments their capital debt is increasing with every passing month making a bad situation even worse?

Hi DT

I have written a Key Post which explains the impact of the different types of restructuring which you will find here:

http://www.askaboutmoney.com/showthread.php?t=159818

In simple terms, if a borrower pays less than the interest being charged, the balance outstanding will rise.
 

Its hard to see that we could have had a serious recession and NO drop in house prices
Yet once people lost their jobs or experienced income reduction there would have been a crisis.
This would have been partly due to the relatively high mortgages but also credit card debt, car loans, etc.
The drop in house prices makes matters worse because of loans secured on the previous appreciation of house values.
At the developer level, the drop in turnover of their businesses affected their ability to make repayments on loans for land purchases.
 

DerKaiser, you're missing the point. Some level of debt forgiveness has already been paid for, and if we don't use it, we'll lose it. It has nothing to do with Nama, either.

After the PCAR (the latest bank recaps) in March, the Irish banks received more than €15 billion or so in capital specifically to provide for losses on mortgage and personal debt. That's not an opinion, it is fact. It's there in black and white in the PCAR.

Now, the taxpayer is not getting that money back. It has already been paid over to the banks, borrowed by the state from the troika.

That €15 billion currently is sitting unused on the banks' balance sheets - unused for the purpose for which it was given. There is no way it can be returned to the taxpayer - that cash now belongs to the banks, to be used for a specific purpose. We need to use it.

If the banks get sold off before that capital gets used, then some foreign bank, some private equity company, or whoever buys the Irish banks off the state, will walk off down the road with that €15 billion in capital in their back pocket. It won't just simply add €15 billion to the purchase price received by the state for the banks. It doesn't work like that. Whatever foreign entity buys the banks will get that €15 billion in capital on the cheap.

In the meantime, consumer spending will remain constrained and consequently unemployment will remain high because of the personal debt levels of Irish citizens.

Someone has to grasp this nettle, for recovery and the economy's sake.

The money has already been provided, despite what DerKaiser says. The country should use it, or we'll lose it to whoever buys the banks.
 

BIGGER PICTURE surely?. Eurozone crisis, global economic meltdown, bank stress tests. Why do you think the banks are hoarding this money?
 
Well done on tackling her last night Brendan.
 
Well done on tackling her last night Brendan.

Thanks gaius. This thread was excellent in preparing me for the discussion.

What programme was that please?

The Late Debate starts at around 11 minutes in

Also is that the lady who was on another programme about a year or two ago?

She was on the Frontline - unchallenged.
She has been in the Indo - unchallenged
She has been in the Examiner - unchallenged
She was on last night's Six One News - unchallenged
She was on last night's Nine O'Clock News - unchallenged.

So, I redressed the balance a bit by challenging her.

Brendan
 
As there is a lot of information on Caroline Lennon Nally in this thread and as she continues to campaign for something, I have moved it into a new thread

Caroline Lennon Nally - Posterwoman for mortgage arrears
 
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