Leaving negative equity behind us in Ireland

strathspey

Hi, I'm an Antipodean, married to an Irish national. We bought and sold at the peak of the property bubble in Ireland and with the proceeds bought a property back in Australia. We then bought an apartment in Dublin, but intentially didn't tell the bank we owned property in Oz. The Dublin property is now in negative equity and we're definately emigrating. Question is, with little propect of selling the apartment, we're just going to hand back the keys or perhaps not even bother, does the Irish bank have any recourse to us in Oz, even if they manage to track us down?

amcalester

I've no idea, but I hope they do.

Walking away and defaulting on the debt is going to cost the tax payer money in more bailouts to the bank.

You bought the flat, lied on the mortgage application and now becuase its in negative equity you want someone else to pick up the tab of your gamble.

Would you be handing back the keys if the price had continued to rise? I doubt it, why not take some responsilbity for your actions and pay back what you agreed to?

AARRRGH

They may never track you down; but they might track down your Irish partner. It's risky, and if caught, you will owe a lot of money.

Agent J

strathspey wrote: »

Hi, I'm an Antipodean, married to an Irish national. We bought and sold at the peak of the property bubble in Ireland and with the proceeds bought a property back in Australia. We then bought an apartment in Dublin, but intentially didn't tell the bank we owned property in Oz. The Dublin property is now in negative equity and we're definately emigrating. Question is, with little propect of selling the apartment, we're just going to hand back the keys or perhaps not even bother, does the Irish bank have any recourse to us in Oz, even if they manage to track us down?

Assuming the Irish nationals name is on the property they would have their finanical repuation ruined here and wouldnt be able to as so much open a bank account here (let alone loan etc) ever again if it was unresolved.

Irish law doesnt allow for just posting the keys through the letterbox im afraid.

As for tracking you down in Oz.
I imagine its possible(must be some sort of bi lateral EU-Austrailian agree ment) but probably time consuming and would depend on how much is involved in that property vs effort/cost) to proceed down international legal paths.
I would imagine they would reposess the property and stick both names on the ICB(Irish Credit bureau) which would effectively black list you if they cant find you over here.
That is pure speculation though

Off the top of my head i can imagine a bank in Oz looking for a bank reference for the irish national to set up an account over there or if they go for any type of loan/mortgage over there.

To be honest i would say the possible effects are more on your spouse then they are on you.

road_2_damascus

Agent J wrote: »

Assuming the Irish nationals name is on the property they would have their finanical repuation ruined here and wouldnt be able to as so much open a bank account here (let alone loan etc) ever again if it was unresolved.

Irish law doesnt allow for just posting the keys through the letterbox im afraid.

As for tracking you down in Oz.
I imagine its possible(must be some sort of bi lateral EU-Austrailian agree ment) but probably time consuming and would depend on how much is involved in that property vs effort/cost) to proceed down international legal paths.
I would imagine they would reposess the property and stick both names on the ICB(Irish Credit bureau) which would effectively black list you if they cant find you over here.
That is pure speculation though

Off the top of my head i can imagine a bank in Oz looking for a bank reference for the irish national to set up an account over there or if they go for any type of loan/mortgage over there.

To be honest i would say the possible effects are more on your spouse then they are on you.

There are very many people planning this very move. There are many car reposessions where the car has been dumped at the airport, and top of the range cars too. The bank has to pick up the parking tab :-D As for the property, your spouse may not be able to open a bank account, but there may not be any banks by the time she comes back! To blazes with the banks, the developers, and the estate agents that have fraudulently exaggerated the value of property in a bid to gain millions and trap thousands of young people into being mortgage slaves, where all they were doing was trying to secure their future...the banks walk away unscathed...they should be burnt to the ground with the bankers locked inside... thats my humble opinion

Agent J

Oh here we go with the big evil banks forced all these people at gun point to take loans out.

Two words

Personal responabilty.

Yes some banks lent imprudently and mistakes were probably made but people took the money and would not be complaining about if the property bubble was still inflating would they?

Also i was purposefly avoiding the morality issue of the orignal OP but since you drag it up i think they should be chased and fully prosecuted for running.
The acutal debt isnt my problem but the up sticks and run like hell should be clamped down upon. As some one else says you cant just run away and stick your fingers in your ears and hope it will all go away. (Sorry OP, Nothing personal)


The people at the top of the banks and the government should also be hunted down as they have part responabilty in this situation as well.

However none of this takes away from the personal responabilty that ANYONE has when they signed the loan agreements.

Also you might want to re read what i said.
The austrailian banks may look for a bank reference for the Irish national if they open an account over there or go for a loan. They will definatly be unable to that here.

johnnyskeleton

strathspey wrote: »

Hi, I'm an Antipodean, married to an Irish national. We bought and sold at the peak of the property bubble in Ireland and with the proceeds bought a property back in Australia. We then bought an apartment in Dublin, but intentially didn't tell the bank we owned property in Oz. The Dublin property is now in negative equity and we're definately emigrating. Question is, with little propect of selling the apartment, we're just going to hand back the keys or perhaps not even bother, does the Irish bank have any recourse to us in Oz, even if they manage to track us down?

Have you considered taking to the bank, finding out what their attitude is and then handing the keys back? It is certainly a better deal for them if they repossess and sell now rather than in 1-2 years time after repossession proceedings (legal costs and further property price drops) and if the level of negative equity is small, they might write it off. This is the more sensible and responsible way to deal with it, and if you're going to run you're going to run anyway, so you may as well try to come to some arrangement with the bank.

Johnny Bitte

?Would renting it out not be an option?

I know it looks like the simplesgt thing to do but I would personally hate the thoughts having to worry about this when dealing with the banks here or anywhere else.

dny123456

I agree with the Goose. You should be able to rent it out, to cover an interest only mortgage at least. The worst thing u could do is hand the keys back, as if they ever do track you down, you'll owe a lot of money. The bank will sell off at a knock down price, and leave the balance outstanding against you. Better if you could hang on at all and have it under your own control. I can see why it would be tempting to just walk away, but that might not be the smartest thing to do. Keep your head.

AARRRGH

Renting it out or staying in Ireland and paying off the mortgage are the right things to do, but when you look at the bigger picture, I can understand why the OP wants to do a legger... we do, after all, only get one shot at life.

mikemac

strathspey wrote: »

We then bought an apartment in Dublin, but intentially didn't tell the bank we owned property in Oz.

Do you buy as First Time Buyers in Ireland?
If I were you I'd be more afraid of the Revenue then the banks.

The revenue have powers the banks just don't have.

dny123456

hmmm, but why would the revenue come after him? He has made a loss, no profit to be taxed.

mikemac

Evasion of stamp duty.
Owning property abroad counts towards your first time buyer status.

The OP didn't say how much their Dublin flat was worth but stamp could have been tens of thousands, well worth pursuing.

Of course all this is speculation if the OP won't give the figures. Just something extra to think about

Senna

The OP said he sold a house in Ireland at the hight of the boom, so i'm guessing the apartment was not bought as a FTB. I think he means he didn't tell the bank about the property in Australia, other wise they would not have given him a mortgage (over extended).

As for running now. I'd worry that the bank would just sell the debt to some kind of collection agency who would pursue you to your new home, thus fecking up your new life over there. I'd talk to the bank first, its not like their going to take your passport away if they think your going to run, you'd be surprised what could be worked out (IO, Longer term, percentage of debt wrote off etc). You could employ a letting agent, let them sort out the rent, put that into your mortgage account and just forget about you Dublin apartment while in Australia.

iguana

I assume that at some point during your mortgage application and apartment purchase you handed over your passport to be copied? The same passport which shows your nationality and area of birth? If the bank (or collection agency who've purchased your debt) decides to pursue you for the outstanding amount it won't take rocket science to work out where you are. Especially if you are returning to the region you were born in. But even if you are moving elsewhere you will be quite traceable if the really want to find you.

Ginger83

strathspey wrote: »

Hi, I'm an Antipodean, married to an Irish national. We bought and sold at the peak of the property bubble in Ireland and with the proceeds bought a property back in Australia. We then bought an apartment in Dublin, but intentially didn't tell the bank we owned property in Oz. The Dublin property is now in negative equity and we're definately emigrating. Question is, with little propect of selling the apartment, we're just going to hand back the keys or perhaps not even bother, does the Irish bank have any recourse to us in Oz, even if they manage to track us down?

Running away is definitely now the answer. I too bought my first home at the height of the boom. Even though the value has dropped I stand by my decision and am happy I made it as if I had waited til now I would not have enough earnings to purchase the house, that is even if any bank would lend to me.
I would not like to jump ship and always be looking over my shoulder and wondering what if- and who is that at the door. You really could be bringing your troubles to OZ with you. If your debt is passed on to a debt collection company these people DO NOT give up, its what they are paid to do!!
If your mortgage is say 200k and you leg-it, the bank could flog it for 100k and the 100k outstanding would still be your debt. If you do decide to go you would never be able to consider coming back, you'd never borrow here again, probably never be able to rent either and would never be able to sign on if looking for work. You would be a coward in many people's eyes,mine included.
Go and grow a pair, sit down and speak to your bank and sort out your mess. Nobody forced you to take out this mortgage. It shouldnt have been given to you in the first place but it was and you are responsible for it. As others have said if it had have went the other way you would have no problem selling and enjoying the profit!!

whizzbang

Ginger83 wrote: »

If your mortgage is say 200k and you leg-it, the bank could flog it for 100k and the 100k outstanding would still be your debt.

200k would still be your debt, it just cost the debt collectors 100k to buy from the bank. They now go after you for 200k so thay can make a 100k profit on the 100k they spent acquiring your debt. They may accept a lower a mount, say 160k, thus giving them 60k profit, but they are legally entitled to the 200k.

I'm sure places like this will be busy the next few years http://www.ozpeopletrace.com.au/