How long before houses get reposessed?

djimi

Ray Palmer wrote: »

You seem to miss the point they can't do that as it will show a discrimination. You have to apply the same rules to all and will have to use a financial basis. They can choose to hit trackers first but not single people first. There are laws in place that won't change.

Im not going to argue with you because I dont know of the law, but it seems strange to me that if I have a list of say 10 names that I cant choose the order in which to deal with those 10 names. Ultimately they will all get dealt with in the same way in the end anyway.

djimi

RATM wrote: »

But surely selling the property crystallising the situation is beneficial to both borrower and bank in some situations. i.e. bank lends 200k for BTL apartment, owner can't afford to pay full mortgage on €200k so it is sold off for say €100k and the owner is left with a debt of €100k over 20 odd years rather than the 200k he did owe.

There must be some circumstances where it makes more sense to repossess than allow the status quo to continue.

But would the banks prefer to have somewhat secure debt of €200k, or an unsecured debt of €100k? Especially given that the security could, in theory anyway (as unlikely as it may be), go up in value at some point in the future? Would it not make more sense to allow the owners to continue paying a lower rate (say the rate that they would end up paying on the unsecured loan) for periods of say 3 years at a time to be reviewed at the end of the period, knowing that the option to repossess was available to them should it come to that?

Im probably talking nonsense here btw!

Ray Palmer

djimi wrote: »

Im not going to argue with you because I dont know of the law, but it seems strange to me that if I have a list of say 10 names that I cant choose the order in which to deal with those 10 names. Ultimately they will all get dealt with in the same way in the end anyway.

Look it this way you have a list of 100 people and you pursue the black people first would you have an issue with that? As we are talking about a large list the order you pick has to be based on a particular criteria you certainly can't use a non financial reason as the list is based on a financial problem. You can pick from the list any way you like once it isn't discriminatory it's pretty simple.

There are strict rules on how you do things.

djimi

Ray Palmer wrote: »

Look it this way you have a list of 100 people and you pursue the black people first would you have an issue with that? As we are talking about a large list the order you pick has to be based on a particular criteria you certainly can't use a non financial reason as the list is based on a financial problem. You can pick from the list any way you like once it isn't discriminatory it's pretty simple.

There are strict rules on how you do things.

Fair enough; as I said Im not arguing with you as I dont know the law in such matters. All Im saying is that I find it strange that the law can dictate in what order you persue your customers who owe you money, as they will all end up paying you (or at least getting persued) in the end anyway.

Wile E. Coyote

Lantus wrote: »

So if you have kds you can safely live mortgage free? Interesting.

If you have the balls and can live with the stress of it all hanging over you and the constant calls and letters and the chance that someone from the bank will arrive on your doorstep one day then you can happily live mortgage free (or very close to it) for 24+ months with or without the kids. Current rules state that they can't take legal proceedings against you for at least 12 months after you first default. You can ignore them for all that time if you wish.

Once you've gone 9-12 months, ring them with your sob story, tell them you've lost your job, your wife, your dog anything at all to pull at the heart strings and ask them for a payment break while you try get back on your feet. They'll give you 3 months and then review it at the end of that. When thats finished get MABS to contact them as well to plead your case to buy you a little more time. You can then ask for Interest only payments, make one or two and default again. If it eventually gets to court the bank will have to show that they've done everything in their power to assist you so they will more than likely agree to any short terms payment plan you ask them to put in place.

Eventually you will need to make the full payment again so when you've taken it as far as you think you can get away with write to the bank and tell them you are going to maintain the full payment going forward. Ask them to agree to capitalise the arrears on your account after 6-12 monthly payments.*


*I'm not recommending anyone do this but have worked in mortgage collections so know it can take an extremely long time before a reposession order is granted.

NIMAN

Do we think we will see a flood of people starting to repay their mortgage as normal once the repossessions begin happening? After all, its thought that a large number of people are strategic defaulters.

When people see others actually losing their homes, will they feel the pressure and go back on the straight and narrow?

saveygirl

I think what's interesting is that nobody has mentioned NAMA in all of this. NAMA are controlling and managing the property market. They currently are the biggest landlords in the state, they are renting 10,000 properties a year with a rental return of 100 million a year!!! Where is that money going to? Why has nobody questioned why these properties have not been sold into the market? According to Mr. Mcdonagh most of NAMA's properties are in prime areas within reach of urban centres, great, sell me one then!
The latest spin from the Property Guru's/Media is that there is such a shortage of so called decent ''family homes'' in Dublin, WHY? When NAMA have thousands of properties under their control. Of course there ''appears'' to be a lack of supply because NAMA are sitting on them. Don't forget NAMA was very quickly set up under fianna fail to ''mop'' up all the properties and protect the assets of developers whom NAMA now employ to ''manage'' their assets.
We have the lowest rates of reposession despite the worst economic recession and yet surprise surprise we suddenly have an under supply of decent houses. The IMF have again called for these houses to repossessed because they know that the 'cute hoors' are at it again, hiding all the decent stuff for themselves and putting all the crap on the market with the big scary story 'that house prices are rising in Dublin',. Oh and has anybody tried to buy a NAMA propety? Has anyone any idea where you can look at a detailed list of Nama properties for sale? Please let me know, all I can ever find are vague descriptions such as ''certain unit in Rathmines etc.'' Talk about a cover up. :mad::mad:

Wile E. Coyote

NIMAN wrote: »

Do we think we will see a flood of people starting to repay their mortgage as normal once the repossessions begin happening?

No because repossessions on a large scale won't happen. They don't benefit the banks or anyone else when the majority of properties are in serious negative equity.

At the minute if the banks were to repossess all these properties it would be similar to debt forgiveness. Take a property with a mortgage of €300k but a book value today of only €150k. If they were to repossess and lucky enough to be able to sell it on at that price without putting money in to fix it up they're left with a now unsecured bad debt of over €150k. If the court couldn't get the owner to make payments to stop him from losing his home, what chance have they got of getting him to clear this balance when there's nothing at stake? The answer is ZERO, so that balance gets written off. Now if that was to happen on a large scale guess who has the pleasure of picking up the tab so the banks don't lose out?

Galego

Wile E. Coyote wrote: »

No because repossessions on a large scale won't happen. They don't benefit the banks or anyone else when the majority of properties are in serious negative equity.

At the minute if the banks were to repossess all these properties it would be similar to debt forgiveness. Take a property with a mortgage of €300k but a book value today of only €150k. If they were to repossess and lucky enough to be able to sell it on at that price without putting money in to fix it up they're left with a now unsecured bad debt of over €150k. If the court couldn't get the owner to make payments to stop him from losing his home, what chance have they got of getting him to clear this balance when there's nothing at stake? The answer is ZERO, so that balance gets written off. Now if that was to happen on a large scale guess who has the pleasure of picking up the tab so the banks don't lose out?

Unsecured debts are not debts that you just choose whether or not you want to pay. The creditor could take legal actions against the debtor and a judge could freeze any debtor's assets and use them in order to cover the outstanding debts.

The only way to avoid paying unsecured debts is for the debtor to be declared bankrupt. Not every debtor qualifies for bankruptcy.

Lantus

another issue for the banks is that a lot of properties are in managed estates which means management fee's. If the owner has not paid his mortgage then he almost certianly has not been paying his service fee's. Once the bank repossess then they are legally required to pay these fees before they can re-sell the property. In the case of apartments this could be a fee of anywhere between €1000 and upwards of €2000 per year. 5 to 7 years of non payment plus any interest charges could easily see the bank being made to hand over €10,000 in fee's. Not a very entertaining thought.

Whether they could attach this to any restructured loan for the person they repossesed off is unknown? I doubt it though. Most property sales I know the bank pays the service fee bill.

It wont take too many of these before the full impact of lending in a managed estate fully hits home to them if it goes wrong as they will be picking up secondary bills attached to the mortgage lease document.