The Qualified Mortgage Patch

In less than a year, the Consumer Financial Protection Bureau (CFPB) is letting the “Qualified Mortgage Patch” (QM Patch) expire. Why does this matter for first time buyers?

The QM Patch states that mortgage buyers must have a debt-to income ratio less than or equal to 43% in order to buy a home. This rule was created to protect borrowers from racking up too much debt. Removing the QM patch could have drastic effects for the European economy. Let me explain:

I grew up living in the United States during the Mortgage Crisis of 2007. It started with many investors looking for low risk high reward profits. They turned to the housing market to buy those loans. Banks would convert thousands of marketable securities and turn them into shares for investors to buy. They believed the investments were safe because house prices were rising dramatically during this time and credit unions gave many of these securities AAA ratings. AAA rating is the best rating a house can receive.

Investors loved these loans because they were very profitable. They started pushing the …

Read More

New world currency, Euro hegemony in the future?

A commentator talks about the euro, dismissing euroskeptics and euro bashers, arguing that it will be (perhaps) the new world currency? Could be possible, but first we have to work our way through the Eastern economy issues (in the West Ireland is the way down), but that is likely to happen, and the euro will survive and prosper. The ECB can be bashed for not acting quickly enough etc. but the reality is that we shouldn’t face the problems down the road that the US and UK will face, Euro bonds are not failing at least [yet]. A prominent economist I had lunch with said he felt our drop in GDP would be closer to 12% than 10%, the same guy told me last September that rates would be 1% by Summer 09′ and I laughed at him! Let’s hope get is fallable at least some of the time.

Read More

A Repossession Guide for Irish Homeowners

We have written ‘A Repossession Guide for Irish Homeowners’ which you can download by clicking on the picture to the left.

The guide is there give people an understanding of the arrears & repossession process, and what you can do to help yourself.

We hope you find this useful, if there are other things that you feel should be included then leave a comment to that effect so that we can develop and improve this tool for people in difficulty.

This is part of an industry-oriented solutions based approach, we don’t intend to ever sell this document or control distribution of it, reproduce it, forward it, print it out and give it to somebody you know who might be in difficulty, our sole hope is that this may bring some degree of help to those most in need of it.

Sincerly, Karl Deeter, Irish Mortgage Brokers.

[This document is a pdf you will need to have adobe reader installed to view it, you can get Adobe Reader by clicking on the image …

Read More

Financial road maps

Having a plan is important in many areas of life, I would feel it is vital in personal finance, yet a surprising amount of people totally fail on this matter and go through life in an ad hoc manner and they are often wondering why some people seem to do better even though they don’t earn as much as they do. Animals in the forest don’t worry about finance, they do worry about food though, hence they gather for winter, squirrels have figured this out so it is disappointing, given the superiority of human intellect, that many private individuals have not planned for an ‘economic’ winter.

A simple method is a budget, it can be complex or it can be crude but in either case having a crude one is better than having none. Sometimes this is worked out using percentages, for instance:

After tax income x 60% = all expenses (mortgages, bills, food, entertainment etc.)

After tax income x 10% = discretionary expenses (something you may have buy from time to time)

After tax …

Read More