Madam, – I’m all in favour of financial institutions being understanding and working with those with large loans they are now finding it hard to manage. Yet to do as Daniel Lowry (March 15th) suggests and to write down or forgive loans that people took out in the full knowledge of what was involved is wholly wrong.
If, as others suggest, after the income and pension levies their mortgage equals their income, then they should never have borrowed that much in the first place as there was no margin for error in their calculations. Or were there any calculations done? If people had not been so eager to bid up prices with money they placed so little value on, then house prices would not have been so overvalued and their loans would not now be so large.
I, too, want to see the developers lose their mansions if they are transferring their debts to the State. I, too, want to see those in the banks and the regulatory system who made mistakes lose their jobs and be held to account. I do not want to see anyone walking away from their responsibilities: not the developers, not the bankers and not homeowners.
The simplest practical solution would be to transfer ownership of the property to the State, allow the people to continue to live in their homes, paying a realistic rent but also contributing towards the loss on the loan. A discount of the loan amount might be considered in that situation, but not while people retain ownership of the asset. – Yours, etc,