Left Ireland for Australia, left keys in door

RATM

jam_mac_jam wrote: »

How are you in negative equity if you bought in 2001, that's a lie.

We don't know that for certain. The OP bought another house after his first one in 2001 so depending on the year of this purchase he may well be in NE.

Either way it sounds like me that the OP tried to engage with the banks and they wouldn't play ball. So he stole the ball and walked off the pitch. He could have rented the two houses out and perhaps only had to subsidise a tiny portion of the mortgage on one of them.

faceman

Mikros wrote: »

I think it has been said already, but the common law rules around enforcing foreign law judgement have been knocking about for 200 years or so precisely to deal with the case of an "absconding debtor". Australia is a common law jurisdiction and those rules would apply equally there. The bank would have to begin fresh proceedings in Australia using the evidence of the Irish judgement as the basis of the claim - it is not straightforward - but is very much possible.

The main factor is the effort / money involved in tracing a person and the cost of a second set of complicated legal proceedings in a foreign jurisdiction. For smaller amounts of debt historically they are just written off. Who knows how that might develop in future? It is a risk you take on.

This is a personal debt though. All examples to date of so called common law court cases have related to high profile, multi million amounts in business transactions.

It just won't happen in a personal debt case like this and if I'm wrong show me examples. We're not the UK. We're not in the Commonwealth. We have no arrangement with Australia.

faceman

Anynama143 wrote: »

Two points:

1. I hope your debt is with one of the foreign banks. If it's not, you are about to rob the Irish taxpayer of hundreds of thousands of euros that I would rather see go to hospitals, schools and the like. Thanks for that - we will all pay extra so you can walk away from your mistakes.

The bailing out of the banks has already occurred and took place before any substantial defaulting took place. Your point is misleading and incorrect.

wrote:

2. This is another example of the moral hazard we were and are assured is not a problem - the amount of strategic defaults is getting ridiculous.

Anyone who doubts this - consider: the rate of unemployment of those in mortgage arrears is HALF the national average. So all these people in arrears are not - as the story has been spun - those who have lost their jobs in the recession. They are stashing money away to buy cheap houses in the future, and dumping the losses on the rest of us.

Thanks guys.

As the article says, there is only anecdotal evidence that its happening. It's naive to think that blatant strategic defaults makes up any kind of significant portion of distressed mortgage, especially in an economy with unemployment at 14%, lack of employment, dramatic tax increases (direct and indirect) and failed system of debt restructuring.

dzer2

Something fishy here 12 yrs ago properties were cheap enough and if you paid the mortgage and interest for that time the property wont be in negative equity so he should sell and pay the bank they would have no problem with that. We have 3 mortages about 12 to 15 years into the the life of them all are in positive equity and 2 are outpaying their mortgages with rental income.

Godge

faceman wrote: »

The bailing out of the banks has already occurred and took place before any substantial defaulting took place. Your point is misleading and incorrect.

Wrong, the only chance the taxpayer has of getting any of the money back is for the banks to make money and become valuable. That won't happen if they write off debts.

At the end of the day, each and every taxpayer will pay towards any debt restructuring or write-off by any Irish bank.

catallus

Godge wrote: »

Wrong, the only chance the taxpayer has of getting any of the money back is for the banks to make money and become valuable. That won't happen if they write off debts.

At the end of the day, each and every taxpayer will pay towards any debt restructuring or write-off by any Irish bank.

My knowledge of the ins-and outs of the structure of banking debt could be written on the back of a small envelope, but I'd like someone to tell me what happened to all the profits the banks made in the boom-time; the banks themselves were coming out in 2004-2007 boasting about making €5000000? a minute every minute of the day, and everybody was saying what a great bunch of lads they were. Where is this money now. And shouldn't the banks now be taking the pain of their prodigious lending instead of ensuring that they squeeze every last penny from the victims of their madness?

Anynama1234

faceman wrote: »

The bailing out of the banks has already occurred and took place before any substantial defaulting took place. Your point is misleading and incorrect.

Totally wrong. I wish people who don't understand finance would stop putting this sort of disinformation around.

The banks needs capital to function - to lend into the economy, to make money. The crash wiped out their capital, and they were bankrupt. The recapitalisation took them out of effective bankruptcy and allows them to work again, but every single default strips away that capital and moves them back towards being zombies. That money is an investment by the Irish taxpayer and every defaulter is using up some of that taxpayer investment.

Your position betrays a fundamental failure to understand how banks and economics works. If the Irish taxpayer bailed out Dunnes Stores, and now owned the company, would it be ok to shoplift from their branches 'because the bailout already occurred'? :rolleyes:

faceman wrote: »

As the article says, there is only anecdotal evidence that its happening. It's naive to think that blatant strategic defaults makes up any kind of significant portion of distressed mortgage, especially in an economy with unemployment at 14%, lack of employment, dramatic tax increases (direct and indirect) and failed system of debt restructuring.

Nonsense. You must be in fairyland if you think that people aren't doing this left, right and centre - I'd guess that the 30-40% figure isn't far off. Do you have any evidence to the contrary?

You have ignored the point that the unemployment rate of those in mortgage default is HALF the national average. Yes - not DOUBLE the average - HALF the national average. Can you explain how this works in your fantasy world of noble Irish people who would never dream of strategic default? :rolleyes:

Anynama1234

catallus wrote: »

My knowledge of the ins-and outs of the structure of banking debt could be written on the back of a small envelope, but I'd like someone to tell me what happened to all the profits the banks made in the boom-time; the banks themselves were coming out in 2004-2007 boasting about making €5000000? a minute every minute of the day, and everybody was saying what a great bunch of lads they were. Where is this money now. And shouldn't the banks now be taking the pain of their prodigious lending instead of ensuring that they squeeze every last penny from the victims of their madness?

Some paid out in dividends, but mostly reinvested in property developments that went bust.

wexie

catallus wrote: »

....the banks themselves were coming out in 2004-2007 boasting about making €5000000? a minute every minute of the day, and everybody was saying what a great bunch of lads they were. Where is this money now....

You need to understand they weren't making 'actual money' as such. A lot of these profits would have been nothing more than 'hot air value' attached to shares, real estate and projected income from loans. A lot of this has since tanked in value or simply ceased to exist/ been written off.

Unfortunately it's not a case that these 'profits' were actually represented by tangible money which was sitting in a vault somewhere. Just like Joe Blogs banks had invested in real estate (think glass bottle site type scenario) which has since sharply devalued.

It's like owning shares, just because that they are currently valued at 100 million doesn't mean you'd actually be able to get 100 million worth of 'real money' (if there is such a thing) for them. The company that issued the shares could come out with a profit warning and poof.....all of a sudden your shares could be worth only 50 million.

And it doesn't even need to an announcement from the actual company. The company might be doing great, with a bright future, and a competitor could go on record that they are currently 'contemplating' taking this company to court.

Nothing has changed, nothing has disappeared, nobody spent days burning and shredding 100 euro notes.... just gone....

Don't spend too much time thinking about it as it just points out how fragile our system is, rumours have been known to affect share values, or even the values of commodities which (technically) are represented by actual tangible assets (somewhere, at some stage in the future, terms and conditions apply).

jmayo

cookie1977 wrote: »

Would you agree though that not everyone employed but in arrears is doing so for strategic default or to maintain a high quality lifestyle?

Yes there are people still in employment who have taken wage cuts/tax hikes and that together with possible partner unemployment may mean they are in mortgage arrears.

But I am betting there is a sizeable chunk of chancers out there who are allowing their mortgages go into arrears because
a) they don't see why they should repay their debts now that their loans are greater than the property value
b) know that it is very hard to repossess property and evict someone in this country
c) have seen other people get bailouts so think they should get one and live in the hope of such
d) can't be bothered scrimping and saving to pay the mortgage and want to continue living in a fashion they became accustomed to.

I think that bet is a better certainty than some of what passes for tips for Cheltenham this week.

The only variable in there is the percentage who are doing, but seeing this is Ireland and how the Irish electorate love a chancer, I don't believe it is a very low percentage.

cookie1977 wrote: »

I mean I don't want a strategic defaulter neighbour getting and easy ride while I do all I can to pay my way but I would feel sorry for those in employment but arrears because they are doing all they can to survive and cannot meet their mortgage or whose bank has refused to effectively help them enough.

I feel sorry for them as well and they deserve some restructuring (not writeoff mind as that just means someone else like me gets screwed with it).
But if we go with blanket measures as demaded by some, then the strategic defaulter that may be next door benefits even more than the poor sod who has scrimped and gone without for the last few years.
Now is that fair ?

faceman wrote: »

...
As the article says, there is only anecdotal evidence that its happening. It's naive to think that blatant strategic defaults makes up any kind of significant portion of distressed mortgage, especially in an economy with unemployment at 14%, lack of employment, dramatic tax increases (direct and indirect) and failed system of debt restructuring.

This is Ireland, the county that had some of the biggest chancers elected as prime ministers, the country that still has people who would support such people as ahern, o'dea, lowry, flynn, the quinns, etc.

It is you that is naive if you think there aren't enough chancers out there willing to try and screw "the system" as per usual.

faceman

Anynama1234 wrote: »

Totally wrong. I wish people who don't understand finance would stop putting this sort of disinformation around.

The banks needs capital to function - to lend into the economy, to make money. The crash wiped out their capital, and they were bankrupt. The recapitalisation took them out of effective bankruptcy and allows them to work again, but every single default strips away that capital and moves them back towards being zombies. That money is an investment by the Irish taxpayer and every defaulter is using up some of that taxpayer investment.

You seem to be using a mesh of textbook fact and fiction with your point. The recapitilisation provided also took into consideration expectations for future defaults. But I assume you already know that. I wouldnt consider the recapitalisation an investment however, unless you like backing a 3 legged horse.

The banks need to write off their bad debt quicker then they are currently doing. We'll never get back to a period of stability and growth until then.

wrote:

Your position betrays a fundamental failure to understand how banks and economics works. If the Irish taxpayer bailed out Dunnes Stores, and now owned the company, would it be ok to shoplift from their branches 'because the bailout already occurred'? :rolleyes:

If your comment is serious, its idiotic. Is that really the comparision you're using? I'll assume its not.

wrote:

Nonsense. You must be in fairyland if you think that people aren't doing this left, right and centre - I'd guess that the 30-40% figure isn't far off. Do you have any evidence to the contrary?

You have ignored the point that the unemployment rate of those in mortgage default is HALF the national average. Yes - not DOUBLE the average - HALF the national average. Can you explain how this works in your fantasy world of noble Irish people who would never dream of strategic default? :rolleyes:

Perhaps I do live in fairyland. However the banks, who are the ones at the front line, have been unable to provide any evidence to support their alleged figures, other than, to quote, 'anecdotal evidence'. Have you anything that supports the statement? I suspect not, because its simply untrue. I have no data to support a figure anyway, but I would estimate it more in the region of 10% from my own exposure. The banks are receiving financial statements from many clients claiming financial distress, yet have been unable to quantify any figures around it that support their claim. It doesnt make sense.

All its serving to do, is create a smokescreen that we're a nation of chancers. If that were the case, then it would weaken the argument that there is a need for the banks to work with their clients in a fair manner.

But anyway, what does it matter. This kind of topic does not nothing put turn Joe Soap on Joe Soap, rather than people focus where the real issues are.

Ray Palmer

In the example of the OP it sounds like it would be easy to find him. If it easy and the purchase of the debt is cheap I can asssure you somebody will go into business to find such people.
Considering people track down releative of dead people for a cut of the estate worth a lot less than the value of such mortgages.
I would do it myself for the right amount. There will be money to be made. The bank would have a lot of key pieces of information to get a detailed picture of most people and family and friends will easily tell somebody where they are gone.

One phone call to the company he worked would probably give us an idea where he is let alone Facebook and the like.

faceman

Anynama132 wrote: »

Your claim that 'the recapitalisation took into consideration expectations for future defaults' - total idiocy. How much 'extra' went into the recapitalisation to cover these expectations? Would it surprise you to learn that they drastically underestimated both the rate of defaults and the future movement of property prices?

Because they did. If the money that was intended to recapitalise the banks goes down the toilet in mass debt write-offs and strategic defaults, the government will just have to recapitalise them all over again, borrowing tens of billions more (if they can get it) and handing the bill to the taxpayer. Cue further cuts to hospitals, schools, infrastructure, and further tax increases.

You seem to be a good example of the maxim, a 'little knowledge is a dangerous thing'. I'm sure you are able to wow your arty friends with your great knowledge of the world of finance, but you won't get very far when you bump into someone who actually knows and understands it.

As for your notions about three-legged horses - the whole point of the f*cking recapitalisation was to give them back a fourth leg and take them into state ownership so that we'd eventually be the recipients of future profits (or more likely, the beneficiaries of an stock market floatation). Instead, you're giving cover to the strategic defaulters who are each taking up a razor blade and trying to carve off some of the horse for themselves, and f*ck the rest of us.

You can assume away. If you can come up with a better metaphor for robbing the taxpayer, I'm all ears.

I don't think it's in serious doubt.

Whats the reason for all the personal comments? You seem to have a real chip on your shoulder.

You have failed to back up your comments with evidence. Or maybe your non-arty friends are wowed by your ability to make statements without evidence and tar all defaulters as being strategic.

Anyway whatever, I'll call it quits there and get back to listening to Morrisey in a darkened room lit only by candle while smoking herbal cigarettes and reading poetry.

RATM

Ray Palmer wrote: »

In the example of the OP it sounds like it would be easy to find him. If it easy and the purchase of the debt is cheap I can asssure you somebody will go into business to find such people.
Considering people track down releative of dead people for a cut of the estate worth a lot less than the value of such mortgages.
I would do it myself for the right amount. There will be money to be made. The bank would have a lot of key pieces of information to get a detailed picture of most people and family and friends will easily tell somebody where they are gone.

One phone call to the company he worked would probably give us an idea where he is let alone Facebook and the like.

You're dead right on that one Ray because I already know of someone who is currently researching the idea of establishing a business to catch up with strategic defaulters in Australia/Canada. He is a former guard and has 5 years experience in the private investigations business and sees this as a big growth area that will give him 5-10 years work before he retires.

He won't be the only one thinking along those lines, I've no doubt that private investigators are approaching banks right now to offer their services on an international scale.

As I said in another post if people were going to pull this stunt they would have been far better off to do it in countries like Brazil or Russia where it would be far harder to catch up with them in the legal sense. The Irish chancer typically thinks he is smart but he isn't' All it will take is the will of the banks to go after these people and given that they need the cash in a big way my bet is that they will do so- if they ignore strategic defaulters then the directors are not doing their fiduciary duties to secure shareholders the best possible profits, which raises a whole load of other issues.

Mikros

faceman wrote: »

This is a personal debt though. All examples to date of so called common law court cases have related to high profile, multi million amounts in business transactions.

It just won't happen in a personal debt case like this and if I'm wrong show me examples. We're not the UK. We're not in the Commonwealth. We have no arrangement with Australia.

Australia has mutual recognition of foreign judgements with countries where there is a reciprocal agreement. This is covered under statute. AFAIK we don't have such an agreement with Australia, unlike the UK, so this really doesn't apply to Ireland, true.

The other way for a plaintiff to seek enforcement of a foreign debt is through the common law principles of "international jurisdiction". If the bank has an Irish judgement against a person for a fixed sum of money they can use that as the basis for taking proceedings in Australia to have it enforced. That fact that it is a personal debt is irrelevant from a legal point of view. The commonwealth has nothing to do with it - this is a principle in all common law jurisdictions (including Ireland).

Also if countries ever get around to ratifying the Hague Judgements Convention of 2005, a judgement in one country will carry equal weight in another country. That is the direction the world is moving.

Your right that it hasn't happened in the past for small amounts or personal debt - certainly I've never heard of an example. I'm just pointing out there is nothing stopping it happening in the future. It's up to the individual to weigh that risk - but to say the banks can't do anything if you move to Australia is not true.

dermot_sheehan

It's amazing what google can find:

http://www.austlii.edu.au/au/legis/cth/consol_act/fja1991192/

Peregrinus

dermot_sheehan wrote: »

It's amazing what google can find:

http://www.austlii.edu.au/au/legis/cth/consol_act/fja1991192/

Ireland is (currently) not a scheduled country for the purposes of the Foreign Judgments Act, so the procedures provided by that Act are not (currently) available to enforce Irish judgments in Australian courts. But Irish judgments can still be enforced under the old common law rules, which still apply as respects judgments from non-scheduled countries.

KegglesMcS

Just some figures to play with with. One house purchased in Dundalk 12 years ago. Price was 112K. Current value:30K

Yes house is in negative equity after 12 years.

murphaph

KegglesMcS wrote: »

Just some figures to play with with. One house purchased in Dundalk 12 years ago. Price was 112K. Current value:30K

Yes house is in negative equity after 12 years.

How much negative equity? Where did you get the 30k valuation?

StillWaters

KegglesMcS wrote: »

Just some figures to play with with. One house purchased in Dundalk 12 years ago. Price was 112K. Current value:30K

Yes house is in negative equity after 12 years.

That doesnt make sense to me. 112 would have bought a 3 or 4 semi in a good area. I dont buy the 30k valuation.

Joe Hart

I've worked in London helping some UK banks trace mortgage defaulters around the world. You can run if you like but you can forget about every having any kind of wealth for the rest of your life. Any businesses, houses, cars etc. They will let you build up a new life and then they will take their money with interest and costs.

faceman

Joe Hart wrote: »

I've worked in London helping some UK banks trace mortgage defaulters around the world. You can run if you like but you can forget about every having any kind of wealth for the rest of your life. Any businesses, houses, cars etc. They will let you build up a new life and then they will take their money with interest and costs.

Have you any links to court cases? Bar high profile cases I've rarely come across it. When I have, it's been in the EU only. Companies will threaten but very few take a case.

KegglesMcS

StillWaters wrote: »

That doesnt make sense to me. 112 would have bought a 3 or 4 semi in a good area. I dont buy the 30k valuation.

I dont care if you buy it or not. That's the house current value.

Peregrinus

The discussion of whether Keggles's properties are, or are not, in negative equity is a bit of a red herring. Clearly, if they are not, then when the bank sells the property Keggles's debts will be cleared so, viola, problem solved! Keggles will not need to worry about burdening his descendants unto the seventh generation.

On the other hand, if he thought there was the remotest chance that the properties were not in negative equity, Keggles would not have abandoned them.

At the very least, then, Keggles thinks they're in negative equity. And since Keggles is closer to the situation than any of us, and knows more of the facts, and has a strong financial interest in not getting this wrong, chances are he's right.

KegglesMcS

Thanks pinhead. I can assure you that this is correct.

gaius c

Denis k wrote: »

Best of luck in aus.unfortunately your debt will continue to grow.i believe the banks can sell on the debt,you will have to deal with it at some stage

Russians have been getting into debt-collection for some time now and their recovery rate is pretty good...

carpejugulum

Have you paid the household charge, OP?
Are you gonna pay the tax? Revenue may get you much faster.

KegglesMcS

Nope and Nope

Peregrinus

Most countries will not enforce foreign revenue debts, so Keggles is safe from the Revenue as long as he stays in Australia. If and when the bank enforces its security and sells the houses, arrears of property tax will be discharged out of the sale proceeds (and so, effectively, added to the amount which Keggles will still owe the bank).

The Corinthian

KegglesMcS bought two properties; one in 2001 and, based upon his other claim (paying the mortgage for 12 years, up until his emigration 13 months ago), the other in either 1999 or 2000.

The first thing that strikes me is that he was both employed and able to pay the mortgages up until he left - presumably, had he remained, he still would have been able to continue paying.

Even considering his move to Australia, which may have added further overheads (such as renting out there), which would have made it difficult to continue paying, it seems strange that he was unable to strike a deal with the bank to decrease payments, or even unilaterally decreasing them (whereby a bank would nowadays be far less likely to take action). Presuming that he cannot afford to pay in Australia - after all, the job there was a "great offer" so one can presume that his financial situation improved.

Looking at this objectively, it's not that he could no longer pay but no longer wanted to. Even if he cannot pay after his move to Australia, he did not have to move there; that was his choice. Sure, it might have been a great opportunity, but we all have to pass on those in our lives because we have pre-existing commitments and responsibilities.

Now this assessment is based on only what he's told us so far. It also doesn't touch on the question of negative equity, paying the mortgages for 12 years and years of purchase, does raise a few questions. However, it does look more like he made some bad investments (he had two properties, so at least one was purely an investment), got burnt, was able to deal with the consequences but decided he didn't want to, rather than couldn't.

If this is the case, then I'd have to say I have very little sympathy for him, as he actually has a pretty good chance of riding this out from Australia, while the bank will likely be able to write down the loss which will, one way or another, likely get picked up by the tax payer.