Drop rates so banks can lend more…

In the ongoing variable rates pricing fracas there are many points being overlooked. The first is why our mortgage rates are higher than other European countries, but we should just ignore that – at least to stay popular.

We’ll say that the government/Central Bank pressure works and banks drop their rates, what next?

We might get around to the greater number of people under price pressure for housing (the renters), but that’s unlikely, instead we’ll inadvertently drive up house prices a little more by making credit more easily available.

Because the lower the variable rate the lower the stress test. Lower rates equals more credit, it’s a fact of life in lending.

You heard it here first. The lower variable rates go the more it frees up a persons lending capability. We have covered the way the Central Bank lending rules won’t work to the point of being annoying (and we weren’t alone, the ESRI and …

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RTE Drivetime: Talking money on ‘Kidults’ with Karl Deeter & Jill Kerby

This week on RTE Drivetime’s ‘Talking Money’ segment we looked at the issue some parents have with ‘Kidults’ who are grown up children living at home. There are many reasons behind the increased occurrence of people remaining at home, and there are both advantages and disadvantages, we tried our best to give some tips that might help!

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What’s a mother worth? (financially)

Irish Life did some interesting research (full infographic here) on ‘what a mother is worth.

It’s fascinating to see the difference of perception versus reality towards a mothers contribution to a household and the cost it would require to replace what they do.

This doesn’t factor in issues such as many dads being damn near useless by comparison – which is not easily statistically expressed, but anecdotally those that match mothers pound for pound are not common.

Just an interesting few thoughts for the day, and a reminder of the value and importance of mothers contribution to their households (hope we see a similar showing on Father’s day!)

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Some questions from Henry

Henry Silke a PhD candidate in the DCU school of communications emailed me some questions which he wanted my opinion on.

As we are always open to this kind if discourse we naturally agreed and decided to post them. You can check out Henry’s work at CriticalMediaReview to which he contributes, and where they do a good job of critiquing the culture, approach and methods of the media.

His questions are followed by my answers, I didn’t split them into the proper paragraphs as I thought I’d keep all of one persons thoughts to one section and the others to the other.

Q1: Do you conceptionalise housing as an exchange commodity or as fulfilling a social need, if both which role takes precedence?

A1: It’s both, like many physical things that are traded it has commodity like features but also provides for a social need, the same goes for foodstuff which is traded, it has a market and also provides things like soft commodities which then feed populations. In terms of what matters more its hard …

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Irish Property Owners Association – a ‘taxsault’ on property owners?

This is a statement sent out from the IPOA, it makes a lot of very valid points and also raises the spectre of cost-push inflation in rental costs. Nobody stands to gain from the current increase in rental costs, not the tenant, not the landlord who is using the increase to set off higher costs from taxes and other state imposed costs and certainly not the people who manage or live in rented property. The only beneficiary of this is the exchequer.

It has been reported that rental rates in some parts of the country are increasing, but that is hardly surprising given the enormous direct and indirect taxation levied on landlords.

The landlords’ national representative body, the Irish Property Owners Association (IPOA), invented a new verb to describe the situation – to “taxsault”.  And they said that is precisely what is happening now.  “Private landlords cannot be expected to subsidise the rising costs of letting,” said the IPOA’s Margaret McCormick. “They have to cover their costs including heavy mortgages, try to earn a sustainable income and pay their taxes, …

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Banking flim-flam, ‘We’ll huff and puff and may or may not blow your house down!’

The banks are constantly issuing threatening letters, we have posted many of them here. We have seen it all at this stage, couples in their 60’s with lots of equity being told to sell up when they clearly didn’t have to, others who are able to get massive write downs and every other combination of fact you can imagine.

Today we will look at the huffing and puffing portion of banks chasing a person for debts. The page to the left is a chronological example of letters a borrower will get from the bank. In this instance the person is defaulting because they don’t want to go on capital and interest and are engaging in what amounts to a game of ‘chicken’ with the banks.

The first letter is standard, it came after the client missed about 4 months of payments, to this point there were two calls then this letter.

The letter starts off fairly heavy, in terms of implications, they …

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What banking insiders think of what banks are going to do

We got a comment on our site from an ex-banker who heard a radio segment where we were talking about banks and repossessions. We got in touch and asked if we could post his comment as a stand alone entry, he agreed, his thoughts are very interesting and in part might help explain why we have repossession orders without repossessions, eye opening reading…

I listened to your piece on Newstalk this morning (19/08/2013) regarding ‘strategic defaulters’ and I just wanted to congratulate you for highlighting the reality of this issue.

I worked for the former *closed bank* for over 17 years and for a two year period I was it’s Mortgage (Residential) Administration Manager. Although I’m out of banking now I still help former clients with negotiations with various banks.

My experience over the past couple of years, and especially this year, in ‘dealing’ with the banks, foreign and domestic, has exposed some incredibly unethical and unfair practices and on the whole I fear …

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Spin me right round’ – some thoughts on IBF data

In statistics there are two key components, the first is the actual ‘data’ the second is the ‘inference’ or what the data actually means. If you saw that one summer was hotter than the last by collecting daily average temperatures that would have statistical significance, if on the other other hand you saw that July was 56% hotter than January then you’d be stating the obvious and your ‘inference’ would be laughable.

That we can see this when it comes to meteorology is obvious, and almost nobody would take such news as having any significance, but when it happens in finance it can go unchecked although Eamon Quinn at the Wall Street Journal caught the IBF out on their release which is about mortgage lending being ‘56% up this quarter’.

Here’s the actual quote they lead with ‘The latest figures from the IBF/PwC Mortgage Market Profile, published today, show that the number of new mortgages issued in Q2 2013 has increased by 56.1% on the previous quarter.’ And it …

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ICS to be sold and currently ceasing mortgage offerings.

We have just found out that the EC have approved Bank of Ireland in keeping New Ireland assurance but that ICS must be sold and they are to stop accepting [glossary id=’6898′ slug=’mortgage’ /] applications with immediate effect.

We don’t actually know what this means at present, we have not been informed of how they will deal with pipeline applications, applications that are on the system and approved but not offered, or that are awaiting approval.

We have been told that it will be ‘business as usual’ but it may not be,we heard this line before from INBS and others, and if not this is going to cause quite a nightmare for many people and some them will be our clients.

This is out of our control, and not something we had a contingency plan for, but unlike the norm in Irish finance we are not going to wash our hands of it and say ‘not our fault’, this isn’t about blame, this is about Irish Mortgage Brokers doing a great job for every client we represent, and that isn’t …

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