What about Mortgage Indemnity Guarantees for the bit > 80%?

[Brendan Burgess]

It looks as if the Oireachtas Committee is going to come out against making MIG available. Fair play to them.

The Central Bank was, rightly, opposed to it as well.

Honohan wrote to Noonan to complain about mortgage plan

In response to a request from Mr Noonan, the [broken link removed] has produced a report on mortgage insurance.

In November, the committee heard from a panel of experts about how mortgage insurance schemes operated in other states and the feasibility of adopting one here.

One expert said cuts of up to 2 per cent in mortgage rates could be delivered, saving first-time buyers up to €2,500 a year, if a universal scheme was rolled out here provided lenders passed on the capital savings to borrowers.

The committee’s report is, however, understood to express concern that establishing a scheme may actually increase the overall level of indebtedness.

It is also said to express reservations about the supposed protections afforded to homebuyers.


http://www.irishtimes.com/business/...nan-to-complain-about-mortgage-plan-1.2111427

 

[Raging Bull]

This mortgage indemnity insurance is not in the consumers interest. It creates moral hazard.

For people in difficulty the banks are supposed to work with them in order to at least seek sustainable solutions. However in banks who hold such policies have greater incentives to seek repossession and ultimately cash them in.

Look at the court lists for repossession there is one institution who is seeking repossession in an inordinate amount of cases relative to its % of mortgage.

It holds a policy for every mortgage which is why its repossession rate is astronomical