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Banks withholding money

  • 25-12-2011 3:10am
    #1
    uerthab918
    Closed Accounts Posts: 3 ✭


    Hi so this is my first post on this site...

    I'm just wondering if what the bank are doing here is legal. Well, I assume it is legal but just not very nice. My father has money in his bank account that the bank are holding as security against our house but we're still repaying the mortgage every month. Since he currently doesn't have a job, it's getting harder and harder to make these repayments. He hasn't missed a payment yet but I'm afraid of what will happen if/when he does miss a payment. The bank are also demanding more and more every month - I thought they could only do that when there was a missed payment? It doesn't help that the bank manager is an evil b*tch as well.


Comments

  • #2
    TiGeR KiNgS
    Registered Users, Registered Users 2 Posts: 1,435 ✭✭✭TiGeR KiNgS


    rant over ?


  • #3
    ANXIOUS
    Registered Users, Registered Users 2 Posts: 3,095 ✭✭✭ANXIOUS


    Use sentences, and explain your problem clearly and concisely and i may be able to offer some helpful advice.


  • #4
    tenchi-fan
    Closed Accounts Posts: 3,339 ✭✭✭tenchi-fan


    As far as I know, a bank cannot freeze funds in your current account because they expect you will default on a mortgage payment.

    However, from your post it sounds like you are withholding information. It makes absolutely no sense when you say the bank are demanding "more and more each month". Either explain your situation or stop wasting our time.


  • #5
    Jim2007
    Moderators, Business & Finance Moderators Posts: 10,356 Mod ✭✭✭✭Jim2007


    Sounds like some kind of "back to back" arrangement and not really a mortgage at all...

    I got offered some thing like this over the summer on a holiday property because I'm too old for a mortgage and out of the country. I did not take it up, but was basically a commercial loan with an additional requirement that I place a certain amount on deposit with the bank. They would pay interest on, but I could not access it until the loan was cleared.


  • #6
    unclebill98
    Registered Users, Registered Users 2 Posts: 3,816 ✭✭✭unclebill98


    It seems to me like a "lean on loan" arrangement.

    The only thing to ask the bank is can your dad take some of the funds out.

    However it's perfectly legal and your dad would have signed up knowing this.


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  • #7
    uerthab918
    Closed Accounts Posts: 3 ✭uerthab918


    TiGeR KiNgS wrote: »
    rant over ?
    ANXIOUS wrote: »
    Use sentences, and explain your problem clearly and concisely and i may be able to offer some helpful advice.
    tenchi-fan wrote: »
    As far as I know, a bank cannot freeze funds in your current account because they expect you will default on a mortgage payment.

    However, from your post it sounds like you are withholding information. It makes absolutely no sense when you say the bank are demanding "more and more each month". Either explain your situation or stop wasting our time.

    I came here looking for advice, not to get insulted by a bunch of f*ckwits. I explained the situation as best as I know it - my parents are trying to keep me out of it as much as they can so all I know is the bits and pieces that I've picked up. I'm sure what the bank is doing is legal but whether or not it is moral is another thing altogether. If you have nothing constructive to say then please shut up.
    Jim2007 wrote: »
    Sounds like some kind of "back to back" arrangement and not really a mortgage at all...

    I got offered some thing like this over the summer on a holiday property because I'm too old for a mortgage and out of the country. I did not take it up, but was basically a commercial loan with an additional requirement that I place a certain amount on deposit with the bank. They would pay interest on, but I could not access it until the loan was cleared.
    unclebill98 wrote: »
    It seems to me like a "lean on loan" arrangement.

    The only thing to ask the bank is can your dad take some of the funds out.

    However it's perfectly legal and your dad would have signed up knowing this.

    It's good to know there are at least two nice people on this site.


  • #8
    BuffyBot
    Registered Users, Registered Users 2 Posts: 24,924 ✭✭✭✭BuffyBot


    Lose the attitude - that goes across the board. OP - you might not like how it was said, but it's not incorrect..your first post was not easy to comprehend. The simple truth here is you get out what you put in: the better the information, the better the answers.

    Also, use the report post function to flag problematic posts in future - don't drag it out on thread. Finally, familiarise yourself with both the site rules and the forum charter before posting again. Thanks!


  • #9
    phormium
    Registered Users, Registered Users 2 Posts: 3,345 ✭✭✭phormium


    You need to have more accurate information before anyone can help you, it does indeed sound like there is some sort of lien on the funds and that would have been agreed originally by your parents. Repayments do not usually just go up and up for no reason if it is not because of rate rises. If there is indeed a lien on the funds in the savings account then the back can put them against the loan if it is not paid as per agreement, this would have been the whole point of the bank setting it up like that. Banks like security and for some reason this extra security was needed in your parents case when they took out the loan, perhaps it is not a mortgage at all but a 'back to back' loan against the savings.

    How much is outstanding and what is in the savings account? What rate are they getting on the savings and what are they paying on the loan?


  • #10
    uerthab918
    Closed Accounts Posts: 3 ✭uerthab918


    phormium wrote: »
    You need to have more accurate information before anyone can help you, it does indeed sound like there is some sort of lien on the funds and that would have been agreed originally by your parents. Repayments do not usually just go up and up for no reason if it is not because of rate rises. If there is indeed a lien on the funds in the savings account then the back can put them against the loan if it is not paid as per agreement, this would have been the whole point of the bank setting it up like that. Banks like security and for some reason this extra security was needed in your parents case when they took out the loan, perhaps it is not a mortgage at all but a 'back to back' loan against the savings.

    How much is outstanding and what is in the savings account? What rate are they getting on the savings and what are they paying on the loan?


    Ok I'll do my best to explain it again, a lot of it goes right over my head though.

    I talked to them tonight and (from what I understood) the bank are keeping money as security against the house but I think the time limit has expired to repay the mortgage? The bank and my parents refinanced (or restructured maybe) but when they did that for some reason the date that the loan was due on was never changed so it stayed the same as the original, expired, date. I think there was a reason they did this at the time but now the bank want the whole thing repaid immediately or they're threatening to repossess the property even though they have more than enough of our money held to cover the repayments for the next few years. My parents haven't missed a payment at all but because of this date issue the bank can seemingly demand this. How is this in any way fair or even legal?

    Sorry if this is entirely different to what I said before, I don't really understand any of this stuff too well.


  • #11
    cookie1977
    Registered Users, Registered Users 2 Posts: 6,794 ✭✭✭cookie1977


    Your parents should go speak to FLAC www.flac.ie and maybe also MABS www.mabs.ie Both are very busy but they can help. Have a look here too:
    www.keepingyourhome.ie

    Your situation is probably too complicated to be relying on a forum for firm advice but speaking to the above should help set them straight on their rights.


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  • #12
    phormium
    Registered Users, Registered Users 2 Posts: 3,345 ✭✭✭phormium


    It is kind of confusing, what ages are your parents? Perhaps the loan term could not have been extended because of their ages. Even if there is enough in the savings account to cover the repayments for a couple of years that is kind of a pointless use of the money as I am presuming there is a lot of interest being paid each month, maybe not if it is an older mortgage. If there is not immediate chance of your father getting work in the near future it would nearly be better using the savings to pay off a lump sum off the loan.

    As per previous answer get advice, I would also try your local Citizens Information office, many of them have a once a month arrangement where solicitors give free legal advice. It would only be a short appointment with verbal advice only but it might clarify things for them or point them in the right direction of what to do next.


  • #13
    leeroybrown
    Closed Accounts Posts: 7,563 ✭✭✭leeroybrown


    This all sounds very odd. The bank and your parents shouldn't have engaged in debt restructuring on the mortgage if your parents have enough savings on hand to continue servicing the loan in the medium term. It doesn't make sense to hold onto large deposits when you know that you'll continue to service a mortgage with a higher interest rate. Are you sure that they're not on a low interest only payment? Beyond that I'm not going to even speculate on what arrangement they've entered into.

    You won't be able to get the advice you need here because you won't be able to accurately describe the situation to us. Get your parents (not you) to go MABS and FLAC as mentioned above and get some proper advice about the situation. Getting MABS involved will put them in a strong position should it ever go to court and FLAC will be able to advise on the legalities involved.


  • #14
    daltonmd
    Registered Users, Registered Users 2 Posts: 1,246 ✭✭✭daltonmd


    uerthab918 wrote: »
    Ok I'll do my best to explain it again, a lot of it goes right over my head though.

    I talked to them tonight and (from what I understood) the bank are keeping money as security against the house but I think the time limit has expired to repay the mortgage? The bank and my parents refinanced (or restructured maybe) but when they did that for some reason the date that the loan was due on was never changed so it stayed the same as the original, expired, date. I think there was a reason they did this at the time but now the bank want the whole thing repaid immediately or they're threatening to repossess the property even though they have more than enough of our money held to cover the repayments for the next few years. My parents haven't missed a payment at all but because of this date issue the bank can seemingly demand this. How is this in any way fair or even legal?

    Sorry if this is entirely different to what I said before, I don't really understand any of this stuff too well.

    Hi there, that's an awful situation for your parents and a worry they don't need. You do need to get more information about what exactly went on between the bank and your parents.



    What is more worrying to me is that your parents are very confused as to what they did, it could be the case that they were sold a product without it being explained clearly to them, so it may be worth contacting the NCA (below) and try to get all the relevant documentation from your parents.

    http://www.nca.ie/nca/jargonbuster

    If you feel that your parents were mis sold a product then you can make a complaint here http://www.financialombudsman.ie/


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