‘We Don’t Have A Dinner During The Week. We Have It At The Weekend’

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House-on-percentage-points

Behind with your mortgage payments?

RTÉ Radio One’s Today with Sean O’Rourke reporter Valerie Cox visited the Phoenix Project a centre for distressed borrowers in Portlaoise this morning.

There she met elderly couple Cheryl and Joe.

Valerie Cox: “Cheryl and Joe’s situation has put them in pure fear. They took out a mortgage 14 years ago of €115,00 but they both lost their jobs and they couldn’t pay it, they now owe €93,000 and they are both on social welfare, but here’s the thing they are still paying €450  a month into their mortgage, they should be paying €680 and this means that they’re left with very little money. This is how they’re living…”

Joe: “We have the social welfare, but that’s going to, that’s been going to it”

Cox: “So how much have you got left to live on?”

Cheryl: “Just €20 or €30 Euros a week, that’s all that’s left.”

Cox: “And do you pay for your food out of that?”

Cheryl: “Yes. That’s it.”

Cox: “So how do you manage, what do you buy?”

Cheryl: “Well, I buy basics, Tea, milk bread I can cook from small cheap food you know I make it stretch because we live in the country, everybody cooks.”

Cox: “What would a particular dinner be?”

Cheryl: “Mince anyway and potatoes. We have our own vegetables, a few vegetables. Valerie, we don’t have a dinner during the week. We have it at the weekend.”

Cox: “What do you survive on?”

Cheryl: “Bread, and fruit, because we have apple trees, we had loads of apples this year, and vegetables.”

Cox: “And what about fixed charges this year like the property tax, how are you going to manage with that?

Joe: “Coming up, we have to cut back on something else, something goes to one side till the property tax is paid, then make it up along again…”

Cox: “But sure there’s no room to cut back there.”

Cheryl: “I honestly don’t know in March how we’ll pay it. I didn’t answer the letter yet, I just don’t know, and the water, I haven’t, I don’t even want to know about the water.”

Cox: “And what about Christmas, now?”

Cheryl: “No. What Christmas? There is no Christmas. No, I don’t care about Christmas any more. It doesn’t feel like… I’m sick of Christmas at this moment in time. You’d think you had just money to hand out for everything, the television never stops, the shops are at it, it’s everywhere, I hate it now at this moment.”

Joe: “Yeah, Christmas now is a thing of the past for us, we don’t have money to enjoy it any more Years ago in the building and everything you had a few pound there to get a few presents here and there but that day is all gone. “

Cheryl: “I’d just like to hold on to the house, to be honest, that would be a present.”

Listen back here

Meanwhile…

Valerie Cox: ‘This is Bill, he’s got 5 children he’s 54 years old, and he made a major mistake, Sean, during the boom years by investing 100,000 Euro in bank shares, and borrowing the money from the bank to buy them. Now, his mortgage is 480,000, it should be costing him 2800 a month and he’s paying 600, he’s still in a job but at much lower wages, and you’re also going to hear Dave Kavanagh in this piece.”

Bill: “I’m paying as much as I can pay and it just doesn’t seem to be enough.”

Cox: “And what do you do with the rest of your money, the left-overs? What’s your lifestyle like?”

Bill: “Very meagre. I don’t go out drinking, or I don’t know how long it is since I was at a cinema or anything like that, I’m quite happy to live the way I’m living but there’s definitely nothing extra nothing extra at all.”

Cox: “Bill is probably, he’s coming from a new class of people, if you like, who are in danger of losing their homes.”

Dave Kavanagh [Phoenix financial Planner]: “Bill is a professional person and we’re finding it very hard to get traction with the bank, full financial information has been sent in, seeking a meeting with the bank and we haven’t been successful a yet. In one particular call the bank were very, very rude, we sought the transcript of the tape and I’d advise anyone who has a similar experience to seek that part of the meeting, you should seek particular transcript because it can be very useful in defending yourself.

Bill: “I have been affected mentally by this whole scenario and my family has as well. I went to my doctor a month ago and he listened to me and he decided he would write a letter to this particular bank. Within a month of that I got a letter to say they were referring my case to a group of solicitors in Dublin and within a week of that, last Monday, I got a letter to say they wanted vacant possession of my home within 7 days so the letter about me being on the edge obviously had no effect on anybody, they came along and put the boot as far into me as they could, with telling me that I’m to be out of my home, gather up my possessions and they would even allow me do that and go, I don’t know where, I would do that with my family.”

Kavanagh: “The legal process is really to frighten people. They believe it drives behavior and drives performance and when a borrower receives a legal letter and when they see they have seven days to leave their house inevitably first of all when a person picks themselves up from the floor they have to do something about it but when the bank hasn’t followed any due process, when they haven’t followed the code where people are entitled to a fair hearing and that your case is fairly looked at, in Bill’s case here none of that has happened.”

O’Rourke: “Right, so there we have Dave Kavanagh again outlining what can happen and, with him, Bill. You spoke to a barrister, as well, Valerie?

Cox: “Yes. Now, Paul Comiskey-O’Keeffe, he’s a barrister with the Phoenix Project and he’s quite new to Phoenix, he told me he thought he knew what it was all about until he joined Phoenix.

Paul Comiskey-O’Keeffe: “I thought from practice at the bar that I understood how bad the problem was in the country. I have a number of mortgage cases that I’ve done in the past and that I do regularly now but, when I came here, the amount of more people who will never make it to a solicitor’s office to get help became so apparent to me. The other thing that became apparent was, the lack of humanity that was going on, and it sounds dramatic but the first, the other analogy that came to mind was that this place feels like a refugee camp for economic or financial refugees. Every case that comes in here is very simple. It’s about a debt. If people don’t pay it, it is inevitably going to get legal. The sad thing is that if no solution is found somebody will live in the house for the price that many people who coming in here can manage to pay but it will be a different person paying it to a different bank rather than the person who calls it a home.”

Cox: “That seems terribly unfair.”

Comiskey-O’Keeffe: “It is ubiquitous in that every single case has that hallmark and in the real world the house will be sold to someone else who’ll buy it at market value. So many cases here it can be said the present loan to value is 80% You can say loan to value ratio is 80% but Banks are not prepared to finance their current customer, the person who calls it a home at 80%. But someone else will come along after the ‘For Sale’ sign has gone up and done that exact same thing with a different bank.

Cox: “What about people who get all those bank letters and phone calls? Do you think some people are giving up too easily?”

Comiskey-O’Keeffe: “They don’t do anything is the problem. The ostrich approach is as effective as heroin in making you forget your problems and just as addictive because it is the perfect solution to something that doesn’t have a solution. It doesn’t achieve anything though. Unfortunately, you have a lot of people here and when they come in the door you can see the stress etched on their face. Usually it’s a combination of smiling and crying when you’re shaking their hand and seeing them out, because they’ve started to deal with it and they’ve started to understand it’s not necessarily as bleak as they thought.”

 

77 thoughts on “‘We Don’t Have A Dinner During The Week. We Have It At The Weekend’

    1. downtowntrain

      And walk into the glut of social housing is it? Or perhaps squat in a ghost estate? Live in the car, if they can afford one? Move in with the folks maybe? back to education and get some student accommodation?

      Whatever the solution, they obviously just haven’t thought it through clearly enough over the last decade, the dopes.

        1. Mark Dennehy

          If your house is worth less than your mortgage is and you just post the keys through the letterbox, do you think the bank forgets about the difference and lets you walk away even if you had somewhere to walk to?

          I mean, did you think everyone was upset at negative equity for purely aesthetic reasons or something?

      1. kiora

        No social housing.. that is a myth. I can’t get a mortgage on single wage and have been privately renting 14 years now moving every year because of rent hikes. I have friends on housing list over 14 years and they were told they have no chance of being housed in present climate. Maybe NAMA have few places….

        1. Domestos

          One of the reasons you can’t afford to buy a house is precisely because there has been very little movement on repossessions.

          1. cluster

            This is the tough truth.

            It is clear that the bad debt resolution process is not working, but it is also unfair on those of us who have no chance if buying – partially because a lack of repossessions has kept prices artificially high.

            A 24% annual rise in Dunlin house prices is farcical and that is far from being a simple supply & demand situation.

          2. Anne

            It’s not the tough truth.

            So there’s a supply and demand problem, and you’re saying that would be alleviated by repossessing homes?

            Just think about it for a bit.

          3. cluster

            In fact, I said something a bit different, Anne.

            I do NOT believe that the rise in house prices can be accounted for by supply and demand.

            Dublin may be booming relative to the rest of the country but there is still a vacancy rate in the city of somewhere in the region of 9%. This is quite a bit higher than many other similar Europesn cities.

          4. Anne

            Well, prices aren’t kept artificially high because of a lack of repossessions then.

            I find it interesting that some people advocate for house repossessions.
            If a house is repossessed, it’s sold on at market value, and as indicated in the transcript above, the difference in the sale price to the new buyer, would be less or the same, as the LTV rate of the current owners, with little chance of the bank recouping the balance after repossession.

            For example, if you bought a house for 200k a few years back, and the current LTV rate of your mortgage is 75%, you have a mortgage of 150K.

            As indicated by the solicitor in the transcript, If repossessed, the banks will sell the home on at current market value of 150K, but won’t reduce the mortgage for the current owners to 150K.

        2. Anne

          *As indicated by the solicitor in the transcript, If repossessed, the banks will sell the home on at current market value, which could be the same or less than their mortgage, but won’t reduce the mortgage for the current owners,

          1. cluster

            Your own explanation suggests that a lack of repossessions is keeping prices artificially high.

            The banks are still – seven years on – reluctant to realise their losses and the state is colluding with them so as to keep prices rising and avoid further bailouts.

            People like me are sacrificed instead.

          2. Anne

            No, my own explanation does not suggest a lack of repossession is keeping prices artificially high.

            What I explained was that banks are reluctant to write off debt for mortgage holders in arrears, where they could then go on to sell a house at a lesser price than what they could have reduced the mortgage to for the original owners.

            Reluctant to realise their losses? They’re supposed to work with people who fall into arrears, because they’ve been given guidelines by the central bank to do so.
            If houses are repossessed, those people will need social housing.

            The supply issue won’t be resolved by kicking people out on the streets.
            Those people need to be housed.

  1. Anne

    93k owing on a mortgage of 115K taken out 14 years ago, seems very fecking hefty.

    When did they lose their jobs?
    If they made payments for say about 10 years, of €680, that’s about 81K of payments.

    Did the bank come to any arrangement with them? If so, when?
    How much of the 93K owing, is in interest, since they lost their jobs?

    Hopefully the €450 being paid is making some dent on the principal and they’ve come to some arrangement with the bank on that.

    Fupping bank bailouts.. but not for the ‘ordinary’ person.

    1. AH HEYOR

      Probably mostly interest since they lost their jobs and are not paying back enough.

      This story just saddens me.

      1. Anne

        You would hope not..

        http://www.centralbank.ie/press-area/press-releases/Pages/CentralBankPublishesRevisedCodeofConductonMortgageArrears.aspx

        The Central Bank of Ireland today published the revised Code of Conduct on Mortgage Arrears (CCMA) setting out requirements for mortgage lenders dealing with borrowers facing or in mortgage arrears. The CCMA provides a strong consumer protection framework to ensure that borrowers struggling to keep up mortgage repayments are treated in a fair and transparent manner by their lender, and that long term resolution is sought by lenders with each of their borrowers. The revised CCMA comes into effect from 1 July 2013.

      1. MUlch

        What makes it worse is they are an elderly couple, so the chances of either returning to work are already diminished.

    2. JimmytheHead

      myself and the better half have been mortgaged for over 5 years and only recently paid off the interest. I can imagine if these folks werent earning much and since this would probably be a second mortgage given they are elderly, chances are it took them alot longer to pay off the interest – which is always higher on a 2nd mortgage.

      but hey, its far more important that our water system is privatized (oh and our social welfare system is next, its already been published on the doles official website btw) at huge expense to the tax payer, so that we can squeeze ever last cent out of the poor. right?

      1. Eve

        Jimmythehead, your description of how mortgages work has my head melted. Interest on a loan, any loan, is not paid off until the lender has received the very last payment. So unless your mortgaged loan had a 5 year term, you are still paying interest.
        FYI depending on interest rates and term of the loan, for mortgages, expect to repay almost DOUBLE what you took out.

    3. Jack Ascinine

      I’m with you on this. The numbers aren’t adding up or we’re not being given the entire story. No way after 14 years of payments would you still have €93k still left to pay.

      14 years = 168 months @ €680 per month = €114.240

      That mortgage should be well paid. They must have lost their jobs years ago and just stopped paying to still have that balance. Someone’s bullshitting here.

      1. Mark Dennehy

        Um. You do get that the average mortgage costs a lot more than the money you’re buying with it at the start, right? That you don’t get to just hand in the total amount borrowed and say “there we are, all done now” because the actual contract is for a lot more?

        Kinda think you need more details to say the numbers are funny.

        1. Dino

          Serious question. Are you capable of constructing an argument without being condescending? It really damages the point you’re trying to make

  2. obriendj

    If they bought a house for €115,000 14 years ago surely it would still be worth at least that now?
    back in 2000 you would have got alot for that money. especially if it is down the country.

    we didnt regress back to those prices did we? so could they not sell, rather than throw the keys in the letter box?
    It is sad and they sound very stressed.

    1. JimmytheHead

      If they can barely afford food I doubt they could afford the two grand in solicitors fees for selling, let alone all the associated costs of selling and buying a new house. Use your head

    2. fits

      Where do you think they will live then? 450 euro wont pay much rent and they’ll still be in the same fix.

    3. Dubloony

      I wonder what else is going on here in the background, the numbers don’t seem to make sense.
      Even so, if mortgage is 680 and they can pay 450, could they not make arrangement with the bank?

      Also, are they getting all help that is available? Numbers seem very low. 450 with 30a week left to live on.

      1. JimmytheHead

        Joans new social welfare scheme works on tax credits accrued in previous years employment. If you dont have enoough, you get cut off. Simple as. If youre too old to work but not over 67 years old, you arent entitled to anything. Poor woman had to sit in her car FOR 2 HOURS because of a water balloon. TWO HOURS…. POOR WOMAN!!

        1. Clampers Outside!

          If you’re too old to work but not over 67 years old, you aren’t entitled to anything…. ….unless you are a politician and then you get your full pension “entitlement” from age 50.

          Which is disgusting really.

          1. cluster

            Is the politician pension entitlement still true for new pols?

            ‘Cause that is an unjustifiable disgrace if so.

        2. Anonanoanom

          That’s 100% wrong. At 65 you got the transitional pension,now you have to claim the dole and at 66 you get your pension either non-contributor or contributor

        3. Anne

          You’re referring to Job seekers benefit, in terms of amounts of PRSI contributions of previous year’s employment.

          Job seekers allowance is means testing.. So to say you’re not entitled to anything is not true.
          It depends on your means.

        4. Anonanoanom

          Ok broadsheet, could you tell me what is wrong with the following comment(considering you deleted it once already)….. Your 100% wrong, at 65 you got the transitional pension, you know go on the dole for a year. At 66 you get either the contributor pension or non-contributor pension.

      2. pissedasanewt

        As long as they are just about managing and killing themselves to keep paying it off the bank isn’t going to bother giving them a dig out.

        They would be better off borrowing 500 million off the bank, buy lots of houses. Go into NAMA and get a big fat wage from NAMA to manage their portfolio.

        1. Anne

          If by ‘dig-out’ you mean debt write down, banks don’t really do that for ‘ordinary’ folk.
          They’re supposed to work with the borrower though.

          Most of the options are basically restructuring, where the aim is that the principal still gets paid eventually, along with the interest/reduced interest for specific periods.

          Option K below is debt write down, but I don’t think they go for that one usually.
          I think it happened once with one bank for one mortgage holder. I think it was a couple who had a mortgage with AIB.. it made headlines there a few months back.

          – Page 17 – Resolution.

          http://www.centralbank.ie/regulation/processes/consumer-protection-code/Documents/2013%20CCMA.pdf

          In order to determine which options for alternative repayment arrangements are
          viable for each particular case, a lender must explore all of the options for
          alternative repayment arrangements offered by that lender. Such alternative
          repayment arrangements may include:

          a) interest only repayments on the mortgage for a specified period of time;
          b) permanently reducing the interest rate on the mortgage;
          c) temporarily reducing the interest rate on the mortgage for a specified period
          of time;
          d) an arrangement to pay interest and part of the normal capital amount for a
          specified period of time;
          e) deferring payment of all or part of the scheduled mortgage repayment for a
          specified period of time;
          f) extending the term of the mortgage;
          g) changing the type of the mortgage;
          h) adding arrears and interest to the principal amount due;
          i) equity participation;
          j) warehousing part of the mortgage (including through a split mortgage);
          k) reducing the principal sum to a specified amount;

  3. bobsyerauntie

    Does it really matter about the how’s, why’s and what if’s regarding this couple’s situation? They are in dire straights, and eat dinner only at the weekends because they have no money left. This is appalling but I have been in similar situations where you go without dinners for the week just to pay the ESB or the rent. My heart goes out to them- and the really tragic part is there are tens of thousands more like them in Ireland today. We can thank Fianna Fail’s train-wreck time in government for this deplorable situation and Fine Gael/Labour for continuing it..

    1. Banotti

      I’m in dire straights can you send me some money. It doesn’t matter about the hows or whys I decided to save most of my 7k a month earnings. I need help.

    2. cluster

      Of course the ‘how’s and why’s and what if’s’ matter. You can (& should) still have sympathy.

      I hate FF but they were pursuing policies much of the electorate desired.

      And whatever your criticisms of FG/Lab, resolving these situations isn’t easy. We cannot just throw money at every punter with a ‘beal bocht’ story – ’cause that will rebound on the state’s finances. There’s enough ructions about water charges as it is – do you really think that there is a desire for a suite of new taxes to pay for widescale debt relief for property owners? I for one am reluctant to pay for other’s mortgages when I cannot afford one.

      That’s why the ‘how’s and why’s…’ matter. State resources in these cases should be carefully targeted rather than merely allowing the greedy to profit at the expense of the young.

      None of that should be taken to mean that I am happy to be paying for financier corporate welfare of the bailout, NAMA, etc

  4. garthicus

    I know there are thousands of cases like this, but something about this one makes me want to send them a few quid, I don’t have a lot but I’d certainly like to send them something, somehow.

  5. lawless Frilly Keane

    What is the house worth?
    Do they have other assets?
    Do they have other borrowings/ Debts
    Do they qualify for a medical card?
    Do they qualify for Social Housing?

    Do they qualify for an Insolvency Arrangement?
    Any info from Phoenix about all that?

  6. Regular 30 something

    Their mortgage is 680 a month between the pair of them – that’s a lot less than most people’s rent. Whether they’re working or not, accommodation needs to be paid.
    Do feel sorry for them though but if they talk to the bank about restructuring the debt rather than just paying less, they’d be far better off.

  7. Eamonn Clancy

    I would have loved to have taken out a massive mortgage in 2002 but didn’t like thousands of others. These poor people must take responsibility for their share of the problem that was the bust. They fuelled the fire.

    1. Anne

      They’re paying what they can.

      As the culchies say –
      You can shear a sheep many times, but you can only skin him once.

  8. H

    I haven’t read all the comments so forgive me if I’m repeating something, at the top it says ‘she met elderly couple Cheryl and Joe’ then it says ‘They took out a mortgage 14 years ago of €115,00 but they both lost their jobs’

    I’m confused about how anyone who was granted a mortgage 14 years ago (which presumably meant that their retirement dates weren’t due for at least 20 years, it would in the UK) could be described as elderly…

  9. ahjayzis

    Forgive my ignorance, but aren’t non-recourse mortgages basically a guarantee against banks losing the run of themselves?

    It’s never mentioned as a possible solution, how come?

    1. cluster

      I think because it would push up the cost of borrowing to buy property as the banks have to price for the increased risk borne.

      You can see how much opposition has been raised to the Central Bank’s proposal to insist on a 20% deposit for most (but not all) of a bank’s loan book. This despite the crash we are still yet to fully emerge from!

      I agree though, non-recourse loans would make a lit of sense.

  10. scottser

    do they qualify for family income support? have they seen a cwo regarding interest only payments for up to 24 months? if i was either of that couple i’d be thinking of paying a bit less to the bank to cover essentials – there is no way a judge would order eviction if they’re still paying a chunk every month to the bank.

    very sad situation for anyone to find themselves in tho.

    1. lawless Frilly Keane

      If I was either of that couple I’d be in to see a Personal Insolvency Practitioner (PIP)

      1. Kieran NYC

        +1

        And they need to come to terms with losing the house (if possible). No point in starving yourself to death over bricks and mortar. Poor people. They’re terrified. Hope they get a professional to negotiate their case.

          1. lawless Frilly Keane

            If they qualify for an arrangement they won’t be homeless.

            The published Reasonable Living Expenses will ensure a better set up than they have now.

            If this story is on the up and up of course

            It could just be a Vincent DePaul style Christmas Promo

            Anyway. Phoenix should have sent them to a PIP. Not to Valerie Cox.

  11. Sidewinder

    guess
    ɡɛs/
    verb
    1. estimate or conclude (something) without sufficient information to be sure of being correct.

  12. Columbo's Missus

    Who gave an “elderly couple” a mortgage 14 years ago?!?!? The bank have to bear some responsibility here.

    1. cluster

      I agree but nobody seems to expect any personal responsibility from the broad swathe of Irish Middle classes.

      Man borrows (on top of his home mortgage) to buy bank shares. Now young PAYE taxpayers should bail him out?

  13. Buzz

    As the Indo attempts to talk up the property market with their front page headline ‘Prices soar 16pc in just one month’. Prices have been dropping over the past two months.

    Sad to hear that elderly couple say they hate Christmas because they can’t afford it.

  14. Toni the Exotic Dancer

    The bloke invested 100,000 Euro in bank shares, borrowed from the bank to buy them. He took a gamble and lost. If his investments had worked out he wouldn’t be handing out cash to you or I. Yet, now he expects a bail out from the Irish Taxpayer. When will people in Ireland take responsibility for their actions?

    1. Anne

      In reality, the bank took the gamble, that he’d be able to repay the loan.

      You don’t know what he expects, but if he now can’t afford to pay back the bank’s gamble on him , it’s hardly his fault that the Irish taxpayer effectively owns the banks.

      It seems like a funny one to me- to invest in shares in a bank, with loans from the bank, and due to their own bad practices, the value of those shares aren’t worth a hill of beans.

      All seems like a big pile of cow dung to me.. Where did the money go – the 100k in this instance – that was never real in the first place?

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