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Minimum price that a house will fall to

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  • 31-05-2010 10:11pm
    #1
    gomaith2010
    Closed Accounts Posts: 36 ✭


    What is the minimum a house price will fall to before a bank will just sit on the property rather than sell? Is there such a concept and has it happened before here or in other countries?


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    #2
    Ste.phen
    Registered Users Posts: 2,808 ✭✭✭Ste.phen


    I'm not sure I understand how that situation would arise, if the bank repossesses and sells a property, and they don't get very much for it, the mortgage holder still owes them the difference between the sale price and the outstanding mortgage, and they have many years in which to track them down if they've absconded


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    #3
    gomaith2010
    Closed Accounts Posts: 36 ✭gomaith2010


    Wow thats heavy, so they can actually sell off the property at what ever price they feel is convenient at the time?


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    #4
    billybigunz
    Closed Accounts Posts: 925 ✭✭✭billybigunz


    gomaith2010 wrote: »
    Wow thats heavy, so they can actually sell off the property at what ever price they feel is convenient at the time?
    Yes. Which is partly why banks were offering 10x income mortgages. It was a bet that they couldn't really lose on.


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    #5
    johnnyskeleton
    Moderators, Entertainment Moderators, Politics Moderators Posts: 14,505 Mod ✭✭✭✭johnnyskeleton


    gomaith2010 wrote: »
    Wow thats heavy, so they can actually sell off the property at what ever price they feel is convenient at the time?

    Not quite, they are under a duty to ensure the best possible price at current market prices. In reality this means that they will hire a receiver to look after the sale and to be honest no receiver could really be blamed for selling them for whatever is offered at the moment. However, some receivers buy into the guff about the corner about to be turned.

    As regards banks sitting on properties, I have heard stories about this but I can't really see it working on a large scale. Banks need money and are not in the business of property lending. Perhaps they might allow someone to remain in the house on compassionate grounds, charing them a rent that they can afford, but in a pure repossession I can't see that working, nor can I see them doing it when there are a lot more repossessions.


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    #6
    Victor
    Registered Users Posts: 78,385 ✭✭✭✭Victor


    johnnyskeleton wrote: »
    Perhaps they might allow someone to remain in the house on compassionate grounds, charing them a rent that they can afford, but in a pure repossession I can't see that working, nor can I see them doing it when there are a lot more repossessions.
    Would they go for evict and re-let to break the occupation? Or would it be necessary in such a case?


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    #7
    johnnyskeleton
    Moderators, Entertainment Moderators, Politics Moderators Posts: 14,505 Mod ✭✭✭✭johnnyskeleton


    Victor wrote: »
    Would they go for evict and re-let to break the occupation? Or would it be necessary in such a case?

    As regards adverse possession it would not matter because the possession was never adverse if they charge a rent. They might notionally retake possession just to be sure to be sure though.

    As regards a part 4 tenancy under the 2004, maybe but unlikely. Not that a bank would be too concerned about a part 4 tenancy in such circumstances.


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    #8
    pawnacide
    Closed Accounts Posts: 228 ✭✭pawnacide


    The sale of a house is one of the reasons an owner can use to terminate a part 4 tenancy. I presume this would apply to bank as well as an individual but I've never come across it .. not yet anyway.


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