5.99% is a rate that would be OK for a credit card or car loan but not for a mortgage interest rate on a rental property. I'm not a Property Developer but bought a rental property as an "investment". I'm not looking for sympathy because the value has crashed or debt forgiveness.
However I do find it unethical that PTSB can charge 5.99% on a mortgage particularly in a Bank that is government supported in a market where it is impossible to change provider.
I accept that a commercial rate should be slightly higher. However 5.99% is almost twice AIB's lowest rate.
The rate should be at least 1% lower. If it is not lowered I will have to seriously look at stopping the repayments as the difference between the rent and the interest payments is too much.
"Warning: The value of your investment may go down as well as up."
"Warning. You should not deal in leveraged products unless you understand the product and the associated risks."
Investment is risky. No risk, no reward. Leveraged investment is more risky than unleveraged investment. These are the facts.
In the event that interest rates for investor mortgages are reduced, someone still has to cover that cost - I'm not saying whether you're right or wrong, but unless you can say who should it be you aren't really proposing anything?
Your wise words also apply to owner occupier mortgages. Unless you feel that negative equity of say 100k on a residential loan is a better or wiser type of negative equity. The simple reality is buying property with a mortgage of any type is a leveraged investment. Many owner occupiers regard their purchase of their home as an investment too. Therefore, using your wise principles of investment its unwise to invest with borrowed money. As that's not realistic for most your wise words on investment are perhaps not so wise when applied to property.
For shares, equity based funds etc...its very wise advice. As for adding to the discussion or question asked, I would say your advice is of no benefit to the OP.
...when it came to investment properties “there are many circumstances in which there is less reason to be inhibited about repossessing”.
...surely now past time for the banks to be dealing more proactively with the situation of over-indebted buy-to-let borrowers no longer able to service the debts they assumed in order to take investment positions – now loss-making – in property...
So.. batten down the hatches BTL's - you are in the sights of the hatchet.