Prime Time will feature sub-prime mortgages tonight

hopefully the canard that 'there are no sub-prime mortgages in Ireland' will be nailed by this programme
 
I don't think anyone has ever said that - the existence of sub-prime lenders in Ireland clearly debunks that.

As a matter of interest does anyone know what % of market is subprime? e.g. by loan value or by number of outstanding mortgages?
 
First things first - is there any strict/objective definition of what subprime means? Higher than normal rates to those with credit "issues" is one thing but is hardly definitive?
 
ClubMan said:
First things first - is there any strict/objective definition of what subprime means? Higher than normal rates to those with credit "issues" is one thing but is hardly definitive?
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Higger than norm rates, to those with credit issues, that don't have to prove thier level of income. Add in any mortgage over 30 years......thats sub prime isn't it?
 
There is no one definition of a subprime mortgage.
The classification “subprime” generally is a
lender-given designation for loans extended to borrowers
with some sort of credit impairment, say, due
to missing installment payments on debt or the lack
of a credit history.

The industry sometimes lumps subprime loans into the general class of
nonprime loans, which also includes the so-called alt-A loans.

Borrowers who receive alt-A loans generally have
higher credit ratings than subprime borrowers, but the
loans are viewed as nonprime because of some specific
feature of the loan arrangement, such as limited
or no documentation about income or assets, high
loan-to-value ratios, high payment-to-income ratios,
the purchase of a second home, or some combination
of these characteristics.
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http://www.frbsf.org/publications/federalreserve/annual/2007/subprime.pdf

Fair to say that the Ireland faces more difficulties over what might be referred to as nonprime than with subprime ?
 
rmelly said:
Rubbish
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Why rubbish?

If a person is given a mortgage that they will only be able to manage to repay by spreading it out over 30 years then would this not qualify as sub-prime? What % of their salary would be used up if the mortgage had to be repaid over 20 years as was the norm (and should return to being the norm now that the insanity of the housing boom is over)?

These loans were given by the friendly banks doing first time buyers a 'favour' by getting them up to their eyeballs in debt by driving up the demand & prices for housing.
 
Thats not sub prime.
By that reasoning a 20 year mortgage is subprime as it longer that a 15 year for affordability reason .

Sub primes are on interest rates well over the norm as the recipients under usual criteria cant get a mortgage from a bank mainly due to their credit rating. That is why they are prepared/must (to) pay the higher interest rates as high street bank wont touch them as they are riskier. Too risky as it appears.
The term of the mortgage has nothing to do with it.
 
Just watching this program now and one thing that strikes me is - why wasn't this program done a year ago or more?. To warn people of the dangers of getting involved with these lenders/brokers. Bit late now!
 
Dee101 said:
Just watching this program now and one thing that strikes me is - why wasn't this program done a year ago or more?. To warn people of the dangers of getting involved with these lenders/brokers. Bit late now!
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Well its just yet more negativity from the "usual suspects". Its just media bandwagon jumping. Ignore and move on folks!
 
charliemacck said:
Well its just yet more negativity from the "usual suspects". Its just media bandwagon jumping. Ignore and move on folks!
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The programme highlighted really serious concerns about the way brokers were selling mortgages. This has nothing to do with press negativity. Prime Time have been doing similar programmes for years. The nursing home scandals were revealed at the height of the boom.
 
What struck me was an Irish mentality of blaming the system / government/ institutions for problems of our own making. It was the same with the first story about the fishermen and the years of illegal fishing.

The actor's voice of the person with three children portrayed herself as a victim of Start Mortgages. I have no doubt that her husband's job loss was a great strain however it was quickly brushed by at the end of the piece that they 'were forced' to sell some land to pay off the arrears to Start. You can't blame Start for trying to retrieve money from people who want to hang on to their investments rather than pay their mortgage provider.
 
Start are well within their rights to recover any money due to them, however, there is something drastically wrong with the system if they are seeking reposesssion for 5k of arrears and incurr up to 10 times that in legal costs in trying to recover it.
 
ontour said:
The actor's voice of the person with three children portrayed herself as a victim of Start Mortgages. I have no doubt that her husband's job loss was a great strain however it was quickly brushed by at the end of the piece that they 'were forced' to sell some land to pay off the arrears to Start. You can't blame Start for trying to retrieve money from people who want to hang on to their investments rather than pay their mortgage provider.
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Excellent point. The unrealistic exaggerated accent of the actress and the point above that they had the resources to pay off the loan all along lost credibility for that section.

Not for a moment condoning what went on in the Irish Mortgage Corporation, but I've respect for Frank Conway for appearing on the show to face the music, even if he didn't have much of substance to say at this point. Can you imagine the tone of the inevitable meeting between the two staff and the directors tomorrow morning? :eek:
 
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