Brendan Burgess
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The rich don't get pursued for their debts like the poor do
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Allpartied
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You remember our " little bit of trouble" back in 2008?
Didn't take a funk out of these guys.
Remember the developers who 'exited Nama'? Most paid less than half their debts
51 out of 505 debtors that exited Nama paid 10% or less of their debts.
www.thejournal.ie
And the green jersey guys? Still living the life, debts forgiven, or forgotten, but certainly not repaid.
Among many other examples
" in the wake of confirmation by Dr Garret FitzGerald that in 1993 two banks - AIB and Ansbacher - cancelled debts of almost £200,000 owed by him."
Former Taoisigh speak out on finances
Three former Taoisigh - Mr Liam Cosgrave, Mr Albert Reynolds and Mr John Bruton - have said they never had any bank debts written…
Brendan Burgess
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I think that Dr Fitzgerald died penniless. He certainly was not rich.
If rich people owe money to the banks, the banks pursue them. If people are bankrupt, the lenders will write off their debts.
I am not sure who the green jersey guys are? If you are referring to the Anglo case of non-recourse loans, that was a strange case and does not justify the conclusion "rich people do this all the time".
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Sure the banks pursue them and they make all sorts of noises. But, a deal is usually done, interest only, write off, blah, blah, blah. Meanwhile they swan around in their Shrewsbury Park property, or on the slopes, or in their Amalfi villas.
Garret Fitzgerald had a hugely valuable property in Ranelagh. He could have sold it, paid his debts and moved to a Corporation house in Finglas if he was broke
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He sold his home as part of a settlement of his debts.
FitzGerald 'had to sell' house to pay £170,000 debt
FORMER Taoiseach Garret FitzGerald settled a £170,000 debt to AIB for £40,000, the Moriarty Tribunal heard yesterday.
www.independent.ie
Whatever about promulgating the myth that "rich people stop paying their debt and nothing happens" , I think it's unfair to Dr Fitzgerald who suffered huge losses and acted very honourably.
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He sold his home as part of a settlement of his debts.
FitzGerald 'had to sell' house to pay £170,000 debt
FORMER Taoiseach Garret FitzGerald settled a £170,000 debt to AIB for £40,000, the Moriarty Tribunal heard yesterday.
Whatever about promulgating the myth that "rich people stop paying their debt and nothing happens" , I think it's unfair to Dr Fitzgerald who suffered huge losses and acted very honourably.
Brendan
To be fair Garret Fitzgerald was in the hapenny place when it came to wealth. But he was still pretty comfortable, and he didn't discharge the debt, when he clearly had the means to do so.
Likewise many wealthy people, move their wealth around, pass it to trusts or family members, to avoid repaying debt. They rarely, if ever, suffer any noticeable reduction in their lifestyle. Ordinary people, you and me, regard debt as a moral obligation, something we feel duty bound to discharge. But the rich, they see it as a means to get even richer. If it works , great, if it doesn't, then they don't pay up.
It's the way of things. always has been.
So, if this couple decide to play the game, stay in their home, stack up the cash and swan around like rich people do, who can blame them
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He clearly did not have the means to do so. He owed £170k because he had borrowed to buy shares in GPA.
He agreed to sell his home and paid most of the proceeds against his debt.
He was not a rich man. He did not die a rich man.
Rich people i.e. people who have assets are pursued by the banks and their creditors generally.
Some people who are no longer rich because they have suffered a huge financial set back, have taken steps to avoid repaying their debts. Some get away with it. Some don't.
Bankrupt people and divorced people often hide their assets.
But it should be clear that rich people don't just stop paying their debts.
Brendan
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I admire your staunch defence of the millionaire class.
All I am pointing out is that rich people, who have plenty of assets and future income streams, go through exactly the same shenanigans that this couple are going through, in order to avoid paying debts.
They largely succeed.
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And all I am pointing out to you is that is nonsense. Widely believed , but nonsense.
The problem with it is that when you promote a myth like that, then some people will say "well, if they don't pay, why should I?" And we end up with the highest mortgage rates in the eurozone.
Brendan
The problem with it is that when you promote a myth like that, then some people will say "well, if they don't pay, why should I?" And we end up with the highest mortgage rates in the eurozone.
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Well, that wouldn't be so bad would it?
People who bought houses in 2004, or 2005, might have paid 300k for a semi d in Longford. Two years later the house is worth 100k and muggins is stuck for the rest.
Meanwhile the guy who borrowed 6 million quid for a field in Longford, just before things went bang, is, in theory, equally stuffed.
But we both know which one will walk away from the debt and, after some theatricals have their debt written off.
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If the guy who borrowed €6m has other assets, he will be pursued for them. And they will be sold in settlement of his debt. If he is bankrupt, he will either apply for bankruptcy or the lender may bankrupt him.
If the guy in the semi-d runs into problems paying his mortgage, he will get all the protections of the CCMA, the PIA regime, Mortgage to Rent etc.
For both, there are excessive protections in place for the family home.
But actually, it could well be the same person. He will lose the field and keep his home in most scenarios.
Brendan
If the guy in the semi-d runs into problems paying his mortgage, he will get all the protections of the CCMA, the PIA regime, Mortgage to Rent etc.
For both, there are excessive protections in place for the family home.
But actually, it could well be the same person. He will lose the field and keep his home in most scenarios.
Brendan
NoRegretsCoyote
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He had a residual debt of £30k written off in 1993.
At the time a Taoiseach's salary was about £70k I think and FitzGerald would have had a pension of 50% of this and probably had an Aer Lingus pension as well. So a gross annual income of about as much as his residual debt.
Yes, interest rates were a lot higher then but I'm pretty sure he could have cleared the debt over ten years. It was a preferential treatment of sorts.
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Indeed.
Even, in retirement, Fitzgerald had a pension of 40k. The average industrial wage in 1998 was 15k. So he could taken the average industrial wage, while retired, and paid the rest of his debt.
I don't want to pick on Fitzgerald, he wasn't the worst,not by a long way. But the ordinary Joe, gets pursued, the bailiffs come.
After what? Probably 6+ years in the case of the couple in question in the original post. And, as the judge said, even at this late stage if they would just engage constructively with at least the court, but ideally also the lender, they can almost certainly still save their home from repossession. Instead they seem hell bent on pursuing some harebrained Freeman style strategy that is doomed to failure. I'll say it yet again, the judgement is a great read.
He did. His son Mark purchased the house (on Palmerston Road) from him and allowed Garret and his wife to live in the basement; GF then used every penny of the sale to repay as much of his debts as he could.
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The money that Garret had written off was borrowed to invest in GPA at the time of its, eventually aborted, flotation. A friend of mine borrowed money to subscribe to the same flotation. My friend who was 25 years of age at the time had to repay the loan in full. He didn't own a house at the time, nor I suspect did he earn as much as the Taoiseach.
What's your point? A 25 year old has a lot more earning potential than an ex-Taoiseach in his 60's who had already sold his house to pay off as much of his debts as he could.
You'll doubtless recall the Moriarty Tribunal comment, having investigated the matter, that "FitzGerald's case involved the effective exhaustion of his assets in order to achieve a settlement" (and that, in contrast, "Haughey's assets were retained virtually intact").
NoRegretsCoyote
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By the late 2000s FitzGerald had pension income alone well into six figures gross annually (also use of a state car and driver).
I'm on balance pretty positive toward him but he got a pretty nice deal from AIB. The loan could have been cleared in full easily within his lifetime.