Home Choice Loans now available for second hand houses

independent.ie/business/pers … 53663.html

Let’s lend taxpayer’s money to (even more) people whom even our foolhardy banks have turned down as bad risks. What could possibly go wrong?

Is Michael Finneran the Minister for Resurrections?


Holy crap, this thing won’t die!

Well, so long as none of that changes, it shouldn’t do much.

Here’s a link to the original Home Choice Loans action thread:

Is this revised scheme an attempt to work around difficulties with EU law?

Sub prime lending at a prime rate.
This is going to be soooo much fun to watch.

I’m seriously considering getting one (I might have to lie to the banks to get
them to refuse me - Jesus, I hope I do).

Get your government sub prime mortgage.
Pay it for a while.
Then go to court with letters from banks showing you never should
have gotten the mortgage.

Would I be barred from the mortgage interest assistance scheme?
A criteria of that scheme is that you should have been able to afford the
mortgage in the first place.

This is the government, so people who do default will get to keep their house
in some sort of Corpo/Social Housing like arrangement. Pay what you can
and eventually you’ll own it.

I’m off to daft to find a bargain.


Would it be possible to game the system?

Basically the scam would work like this: you go to the bank or whatever, show that you have the job etc, but arrive wearing stinky jeans and a raggy shirt, talking a lot about how you spent last night playing no-limit Texas hold 'em with seven pints on you.

Get turned down, then get a nice handy mortgage that you know politicians will be terrified to raise the rates on you!

Even if the bank would have loaned you if you’d kept clean and weren’t talking about gambling all the time.

Better still…

Let’s say you’re in serious negative equity.
Can’t afford even the interest on your existing mortgage.

Here’s a chance to take the hit on your credit rating and still be able to
get a ridiculously cheap mortgage.

Would the Moody’s in Cavan be entitled to one of these mortgages?

If you combine this scheme with new bankruptcy laws that allow you to
walk away from the negative equity portion of the loan, we’ll you’ve
got a recipe for debt nirvana.


I can’t see any other justification.

Nama will require a stream of buyers willing to co-operate in trying to maintain a floor under prices.

And with anecdotal evidence of developers renting out properties or individually mortgaging them, many ‘new’ properties are now second-hand.

From the Indo:

Normal country: people on low incomes get help from the state to house themselves.

Shithole corrupt gombeen idiot nation: people earning above the average income need help from the state to house themselves.

This is an Irish site . 14 pints with 7 shots and a touch of chemical alteration and you are in the ball park .

Given the age group on here, more like 3 pints and you’re off to bed.

Harsh but true JS.

Does anybody know how this scheme works, I’m in full-time employment but cannot get a mortgage with a LTV ratio above 70% so cannot buy at the moment. Where can I get information on this mortgage? I’m a first time buyer.

I don’t know the answer to your question, but it’s worth remembering, that if you can’t get the mortgage, nobody else can either. That means prices have to fall to the point people are getting mortgages for.

Why not? The reason I ask is I dont believe this to be the case for all lenders unless there is a good reason for it.

MOD Edit: Not helpful roc.

Hi, the bank I went to did not give me a reason just the amount I could borrow but this equates to 70% of what I need. I have about 10% of what I think I need saved - to get to 30% will take years. I was just trying to find out about this scheme.

That’s probably good news for you, if you wait a while and save your money then deflation will probably do most of the work for you. 8DD

Hold on a sec, assuming a 20 year mortgage it would take you 20 years to pay 200% of the purchase price. Assuming you can afford the mortgage, you therefore feel you can afford 10% of the price per annum.

So it would take you 2 years to save the remaining deposit if you lived rent free and prices remained static. Prices are falling though, so if you are living rent free it would take you less than two years to save the remaining deposit.

Even if you are paying rent, current rents are approximately 2-3% of purchase price, meaning that you could afford to save 7%+ per annum. At that rate even if prices remained static you would have save the difference in less than three years.

What’s your hurry?

It has stuck me as very, very telling recently how many of the measures of value for housing point to exactly the same thing: further falls of 30% - 40% from today. Yours is another example of this - the bank seem to be saying the property is still 30% overpriced.

A look at rental yields on most properties produces a similar figure. So does using the rule-of-thumb that c. 1/3 of disposable income be spent on shelter/mortgage repayments. You see it too looking at lending to various notional income multiples and also in price per sq.ft. versus comparable countries.

I think your experience is another signal reinforcing this message. Would be interesting to apply some of these other valuation methods to the property and see if they are all saying the same thing. I’d bet they are.