It seems strange to me that Section 115A of the Insolvency Act would have been introduced if keeping families in their homes wasn't a significant consideration in formulating the Insolvency laws.
No this was not a stated purpose of the insolvency laws as far as I am aware and I have read the 2012/2013 Acts a number of times. the legislation was to help those with unsustainable debt including mortgage debt to reach solutions with their creditors. In many cases these solutions could include the sale of the family home.
You're paying anyway if the borrower goes bankrupt to deal with the shortfall after a house is repossessed and sold.
This is ludicrous demotive. You made the assertion. You may well be correct but any assertion made on the basis of "sure everyone knows that he got a write-off" cannot be accepted on its own merits. Provide some back-up verification or otherwise you have lost any credibility!!It's up to you to correct your own erroneous conclusions. Feel free not to read my mind.
In any event, the amount of any shortfall that might arise on a sale would invariably be substantially lower than the cost of forgiving a sufficient amount of the outstanding debt to allow the borrower to remain in a house they can no longer afford.
The reality is that Section 115A of the Insolvency Act is not going to result in wholesale debt forgiveness as you seem to be suggesting.
This is ludicrous demotive. You made the assertion. You may well be correct but any assertion made on the basis of "sure everyone knows that he got a write-off" cannot be accepted on its own merits. Provide some back-up verification or otherwise you have lost any credibility!!
Would apply as much to Joe Soap as it would to DOB!!
Why so? And does that generalization also apply to apartments?
Where have I suggested that?
The big problem, as I see it , is that that there are many people out there who would hate to see Johnny and Mary get a debt write down of a €100k to make their mortgage sustainable
Because the cost to a lender of forgiving a significant amount of debt compounds over time. This is clearly not specific to any loan or property type.
Were you not suggesting that unsustainable mortgages could and should be made sustainable by writing off significant amounts of debt? My apologies if I misinterpreted your post but perhaps you might clarify what you did mean.
I said any mortgage could be made sustainable through a PIA. However I don't believe all unsustainable mortgages should be made sustainable. One size does not fit all where mortgage arrears are concerned.
Ok but where would you draw the line? In other words, what unsustainable mortgages do you think should be made sustainable by way of a debt write down?
the amount of any shortfall that might arise on a sale would invariably be substantially lower than the cost of forgiving a sufficient amount of the outstanding debt to allow the borrower to remain in a house they can no longer afford.
There needs to be some level of rationalization for any proposition other than a banks bad/people good mantra. The banks are not a homogenous species who need to be dealt with outside of the normal law due to past transgressions.As per the PIA guidelines. But banks dont want to give write downs to Johnny and Mary because they want Johnny and Mary to pay for bad borrowing, bad lending, bad government policy and bad regulation, which was what happened during the Celtic tiger.
As per the PIA guidelines.
Could you direct me to the guidelines that detail the appropriate or acceptable amount of debt to be written down?
I don't accept your moral thesis. Why would banks want to do anything other than maximise recoveries? Why would they want to punish borrowers?
At the end of 2015, over 120k PDH loans had been restructured and there were roughly 37k PDH loans remaining that were over 720 days in arrears. It seems reasonable to assume that a very significant portion of these remaining 37k loans simply cannot be restructured without writing down the debt to a point where the lender would have been better off simply enforcing their security and cutting their losses.
The Johnny's and Marys of the world who borrow money from banks or other have an obligation to repay that money.
How many bankers lost their jobs because of extremely reckless lending practices?
A miniscule percentage of arrears cases have gone through the ISI. Only time will tell whether recent changes to the Insolvency laws will change that.
I think we can agree that there have been a miniscule number of PIAs to date.
The amendments to the Personal Insolvency Act have now been in place for a number of months. The Minister for Justice advised the Dail on 28 January 2016 that a grand total of 18 applications had been filed under Section 115A of the Personal Insolvency Act for a court review of a proposed PIA (and that 2 of those applications were subsequently withdrawn).