The Fair Mortgage Rates Campaign should make a pre-budget submission
- Thread starter Páid
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Brendan Burgess
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Hi Páid
It's not really a Budget issue, is it?
I think that the main action will be to get Michael McGrath's amended bill through the Dáil as quickly as possible.
https://www.askaboutmoney.com/threads/update-on-fianna-fáil-bill-to-control-mortgage-rates.204674/
If that happens, then EBS could not keep their mortgage rates high for all customers, and attract new business with the 2% cash back.
To be fair to the AIB Group generally, I think that they would welcome a ban on cash-backs. They are only doing it because they have to have such a product on offer to the customers who want it.
Brendan
I suppose that is a matter of opinion. Any organisation or lobby group can send one in.
http://www.finance.gov.ie/what-we-do/tax/pre-budget-submissions/
You mean both Houses of the Oireachtas. What is the contingency plan if it gets defeated?
Last year AIB chose to give the 0.25% discount to AIB (and then later Haven) customers. To date they haven't offered anything to EBS customers.
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Brendan Burgess
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Hi Páid
Any group or individual can send one in. But how is it relevant to the Budget? Unless we are calling for an extension of TRS for those on SVRs?
Brendan
Brendan Burgess
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Hi Páid
I am compiling a pre-Budget submission which has sections on taxation, social welfare, housing, health insurance etc.
If you have any suggestions on a Budget related issue regarding mortgage rates, I would be happy to include it.
This is the only bit in it at the moment of any relevance.(It's in draft form, so this may change.)
Allow people to take out a mortgage from their own pension fund to get on the housing ladder.
Allow people to borrow from their own pension fund to repay existing mortgages on their family homes.
People are finding it very hard to save up the deposit to buy a house. Why not let them borrow their own money from their own pension fund? Irish borrowers are paying 3.5% mortgage interest to the banks. Why don’t they pay this to their own pension fund instead?
This would have huge advantages
· More people could provide their own housing needs rather than relying on the state.
· It would make the mortgage lenders more secure as the Loan to Values would be lower
· It would cut the cost of mortgages dramatically. Instead of paying 3.5% to swell the profits of the lenders, they would be swelling the profits of their own pension fund.
· It would encourage young people in particular, to contribute to their pension funds as they would see them as a means of getting on the housing ladder.
This would have to be phased in over a few years so as not to disrupt the housing market. For example, it could be limited initially to first time buyers of new houses. It could also be limited to €300,000 or to half of the amount in the pension fund.
I am compiling a pre-Budget submission which has sections on taxation, social welfare, housing, health insurance etc.
If you have any suggestions on a Budget related issue regarding mortgage rates, I would be happy to include it.
This is the only bit in it at the moment of any relevance.(It's in draft form, so this may change.)
Allow people to take out a mortgage from their own pension fund to get on the housing ladder.
Allow people to borrow from their own pension fund to repay existing mortgages on their family homes.
People are finding it very hard to save up the deposit to buy a house. Why not let them borrow their own money from their own pension fund? Irish borrowers are paying 3.5% mortgage interest to the banks. Why don’t they pay this to their own pension fund instead?
This would have huge advantages
· More people could provide their own housing needs rather than relying on the state.
· It would make the mortgage lenders more secure as the Loan to Values would be lower
· It would cut the cost of mortgages dramatically. Instead of paying 3.5% to swell the profits of the lenders, they would be swelling the profits of their own pension fund.
· It would encourage young people in particular, to contribute to their pension funds as they would see them as a means of getting on the housing ladder.
This would have to be phased in over a few years so as not to disrupt the housing market. For example, it could be limited initially to first time buyers of new houses. It could also be limited to €300,000 or to half of the amount in the pension fund.
Gordon Gekko
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Brendan,
It's a superb idea but the Government are utterly conflicted. Yours and many other good suggestions get buried because they would impact on the profitability of the banks and affect the value of the State's shareholdings.
Gordon
It's a superb idea but the Government are utterly conflicted. Yours and many other good suggestions get buried because they would impact on the profitability of the banks and affect the value of the State's shareholdings.
Gordon
I agree with Gordon. Herein lies the problem - the banks (and indirectly the Government) rely on profitable SVR's for revenue. There is no political will to change anything - they just want to keep the banks above water.
I'm not a financial expert like some of the members here. The budget is the State's way of allocating money to be spent or collected over the coming year(s) and for that reason it is relevant to people on SVRs.