You are wrong on this. Lack of evidence of something occurring is not evidence it has never occurred.
Or that it's not possible. His arguemrnt is very defined, he has stated that the NCCP Act makes it illegal for banks to foreclose under a negative equity scenario, that if a loan is underwater it CANNOT be foreclosed on. He has sighted a small section of the act that refers to default only, the act is significantly larger than this some hundreds of pages larger.
He has never answered the question I have asked many times, does the act define negative equity as a form of default?
Just because banks haven't enacted the clause on mass is a pitiful reasoning or arguemrnt that it isn't possible.
Not sure what you think that quote proves. It makes no reference to house prices falling, repossessions, NCCP regulations,....
You can really not see references to those points in the quote?:
"In regard to your question about protections against negative equity for other mortgages [not being reverse mortgages], there are no similar statutory provisions. Under a home loan, banks will usually only take steps to repossess a property when the borrower is in arrears on their home loan after missing the scheduled repayments."
Chris
22 Sep 2015, 10:27 AM
Or that it's not possible. His arguemrnt is very defined, he has stated that the NCCP Act makes it illegal for banks to foreclose under a negative equity scenario, that if a loan is underwater it CANNOT be foreclosed on. He has sighted a small section of the act that refers to default only, the act is significantly larger than this some hundreds of pages larger.
He has never answered the question I have asked many times, does the act define negative equity as a form of default?
Just because banks haven't enacted the clause on mass is a pitiful reasoning or arguemrnt that it isn't possible.
Treasury says "no similar statutory provissions...".
The NCCP Act and Regulations are statutory provisions.
Therefore it goes without saying, the NCCP Act does not protect against this.
You have to ask yourself, do I believe the Financial System and Services Division of the Treasury ( who were responsible for enacting the legislation protecting those under a reverse mortgage) or do I believe someone who makes generalisations about NCCP Act, the Financial ombudsmen, the vibe.......?
As to 'defaults' there are numerous ones such as (but not limited to) not maintaining the property, willfully damaging the property, not maintaining adequate insurance over the property, becoming bankrupt, allowing others to have a claim over the property without the banks knowledge etc etc.
I think you will find that the legislation doesn't have to be prescriptive, just descriptive, on what constitutes a default.
You can really not see references to those points in the quote?:
"In regard to your question about protections against negative equity for other mortgages [not being reverse mortgages], there are no similar statutory provisions. Under a home loan, banks will usually only take steps to repossess a property when the borrower is in arrears on their home loan after missing the scheduled repayments."
Treasury says "no similar statutory provissions...".
The NCCP Act and Regulations are statutory provisions.
Therefore it goes without saying, the NCCP Act does not protect against this.
You have to ask yourself, do I believe the Financial System and Services Division of the Treasury ( who were responsible for enacting the legislation protecting those under a reverse mortgage) or do I believe someone who makes generalisations about NCCP Act, the Financial ombudsmen, the vibe.......?
As to 'defaults' there are numerous ones such as (but not limited to) not maintaining the property, willfully damaging the property, not maintaining adequate insurance over the property, becoming bankrupt, allowing others to have a claim over the property without the banks knowledge etc etc.
I think you will find that the legislation doesn't have to be prescriptive, just descriptive, on what constitutes a default.
You had me at hello Golly.
Good work with this, it appears the grey man is diminishing somewhat on APF. He would normally have the socks running game on a thread until he had shouted everyone down. He is barely logging on himself lately, I would say this is a good indicator of where propert and the economy as a whole is going.
Blokes like him only mouth off when times are good, adversity sees them hiding away.
So we see the typical gold coast cycles LHS and then the no recovery collapse after the gfc. So much for that rubbish about GC being in a normal cycle.
"Panics do not destroy capital; they merely reveal the extent to which it has been previously destroyed by its betrayal into hopelessly unproductive works." John Stuart Mill
You have been shown all the clauses before, mortgage broker Peter (among others) has confirmed their existence.
I've been shown 'clauses' but none of them were in NCCP regulated mortgage contracts.
Chris
22 Sep 2015, 10:27 AM
He has never answered the question I have asked many times, does the act define negative equity as a form of default?
No, it doesn't.
Ex BP Golly
22 Sep 2015, 10:29 AM
You can really not see references to those points in the quote?
No, because they're not in the quote. It only mentions negative equity, and you're selectively quoting. Show us the entire exchange between you and the Treasury guy.
Negative equity could be caused due to some fault of the borrower, for example they knock down the house or fail to keep it in reasonable repair (which is what happened in the scenario Peter brought up last time we discussed this). In those cases, the bank has grounds to take action, and the Court may even grant the necessary repossession order, because the borrower is at fault - they did something wrong, something that they had control over.
But if the negative equity is caused simply by house prices falling (no fault of the borrower) then even if the bank tries to repossess, the Court is not going to grant a repossession order. That's why it has never happened. Not only does it make no commercial sense for the bank, but the outcome for the bank is only going to be bad publicity and a failed court case.
Courts don't just kick innocent families out of their homes. It's not going to happen. The whole thing is a silly bear fantasy.
But if the negative equity is caused simply by house prices falling (no fault of the borrower) then even if the bank tries to repossess, the Court is not going to grant a repossession order. That's why it has never happened. Not only does it make no commercial sense for the bank, but the outcome for the bank is only going to be bad publicity and a failed court case.
Courts don't just kick innocent families out of their homes. It's not going to happen. The whole thing is a silly bear fantasy.
Agree.
In fact, banks will do an awful lot to keep families in their homes rather than risk a massive fire sale of the assets on which more than 60% ( in this country) of their loans are secured.
Property acquisition as a topic was almost a national obsession. You couldn't even call it speculation as the buyers all presumed the price of property could only go up. That’s why we use the word obsession. Ordinary people were buying properties for their young children who had not even left school assuming they would not be able to afford property of their own when they left college- Klaus Regling on Ireland. Sound familiar?
The evidence of nearly 40 cycles in house prices for 17 OECD economies since 1970 shows that real house prices typically give up about 70 per cent of their rise in the subsequent fall, and that these falls occur slowly. Morgan Kelly:On the Likely Extent of Falls in Irish House Prices, 2007
I've been shown 'clauses' but none of them were in NCCP regulated mortgage contracts. No, it doesn't. No, because they're not in the quote. It only mentions negative equity, and you're selectively quoting. Show us the entire exchange between you and the Treasury guy.
Negative equity could be caused due to some fault of the borrower, for example they knock down the house or fail to keep it in reasonable repair (which is what happened in the scenario Peter brought up last time we discussed this). In those cases, the bank has grounds to take action, and the Court may even grant the necessary repossession order, because the borrower is at fault - they did something wrong, something that they had control over.
But if the negative equity is caused simply by house prices falling (no fault of the borrower) then even if the bank tries to repossess, the Court is not going to grant a repossession order. That's why it has never happened. Not only does it make no commercial sense for the bank, but the outcome for the bank is only going to be bad publicity and a failed court case.
Courts don't just kick innocent families out of their homes. It's not going to happen. The whole thing is a silly bear fantasy.
Jesus you are dense.
Shadow
22 Sep 2015, 12:18 PM
I've been shown 'clauses' but none of them were in NCCP regulated mortgage contracts. No, it doesn't. No, because they're not in the quote. It only mentions negative equity, and you're selectively quoting. Show us the entire exchange between you and the Treasury guy.
Negative equity could be caused due to some fault of the borrower, for example they knock down the house or fail to keep it in reasonable repair (which is what happened in the scenario Peter brought up last time we discussed this). In those cases, the bank has grounds to take action, and the Court may even grant the necessary repossession order, because the borrower is at fault - they did something wrong, something that they had control over.
But if the negative equity is caused simply by house prices falling (no fault of the borrower) then even if the bank tries to repossess, the Court is not going to grant a repossession order. That's why it has never happened. Not only does it make no commercial sense for the bank, but the outcome for the bank is only going to be bad publicity and a failed court case.
Courts don't just kick innocent families out of their homes. It's not going to happen. The whole thing is a silly bear fantasy.
None of this has anything to do with the fact that the clause exists, and is in contracts.
I have said many times that I doubt the clause will be utilised.
But every time you say the clause doesn't exist, I'm going to slap you down, because your are an ignorant liar who misleads people.
Veritas
22 Sep 2015, 12:29 PM
Agree.
In fact, banks will do an awful lot to keep families in their homes rather than risk a massive fire sale of the assets on which more than 60% ( in this country) of their loans are secured.
I don't disagree. Check the 200 pages in the other thread. I have long said I doubt we will get to the stage that banks would consider using these provisions. But they exist.
Not only does it make no commercial sense for the bank, but the outcome for the bank is only going to be bad publicity and a failed court case.
Courts don't just kick innocent families out of their homes. It's not going to happen. The whole thing is a silly bear fantasy.
What a load of rubbish. Banks kick innocent families out of homes every day but you don't read about it because the 2 major corporations that control the media wouldn't dare run a story on the practice.
"Panics do not destroy capital; they merely reveal the extent to which it has been previously destroyed by its betrayal into hopelessly unproductive works." John Stuart Mill
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