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Debt on Property?

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  • 28-12-2017 4:56pm
    #1
    Jim1000
    Banned (with Prison Access) Posts: 107 ✭✭


    A house I am looking is up for auction by a bank. The auction house has freely made the folio available. There appears to be 2 debts registered against the property from 2 different banks. The sale price will not cover these debts. So, my question is if one were to purchase this house at less than the debts in question, is he then liable for the rest of the debt?

    Thank You


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    #2
    The_Conductor
    Moderators, Society & Culture Moderators Posts: 32,285 Mod ✭✭✭✭The_Conductor


    No- the person who currently owns the property- is liable for the debts.
    The bank may be auctioning the property- however, they only have a lien on the property- they don't own the property.
    The person who owns the property- took out a loan (or multiple loans) from the bank(s)- using the property as collateral for the loan.
    If they're now selling the property- it is up to them to figure out an arrangement with the bank to satisfy their debts to the bank(s).
    You have nothing to do with this- the current liens on the property are the obligation of the seller- not the buyer.
    Your solicitor will not allow you purchase the property- unless you have clear property to the property.


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    #3
    antoinolachtnai
    Registered Users Posts: 9,792 ✭✭✭antoinolachtnai


    You need to get advice from a solicitor in advance of making a bid at an auction and you need to be assured on this point before bidding.


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    #4
    Marcusm
    Registered Users Posts: 10,328 ✭✭✭✭Marcusm


    The_Conductor wrote: »
    No- the person who currently owns the property- is liable for the debts.
    The bank may be auctioning the property- however, they only have a lien on the property- they don't own the property.
    The person who owns the property- took out a loan (or multiple loans) from the bank(s)- using the property as collateral for the loan.
    If they're now selling the property- it is up to them to figure out an arrangement with the bank to satisfy their debts to the bank(s).
    You have nothing to do with this- the current liens on the property are the obligation of the seller- not the buyer.
    Your solicitor will not allow you purchase the property- unless you have clear property to the property.

    This is only true if it is a condition of the sale that the charges are released fully prior to completion of the conveyance. That should be one of the terms of the legal pack in the auction; however, it cannot he assumed to be so. The holder of the first ranking charge which has put the property in the auction may have no means to force the discharge of the other charge and it is inappropriate to suggest that it would be automatic, especially as this is an auction not a private treaty sale. All due diligence must be done in advance.


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    #5
    Paulw
    Registered Users Posts: 13,381 ✭✭✭✭Paulw


    Mode Note: Thread closed. You already have a similar thread in Legal Discussion section. Please don't open multiple threads on the same thing.


This discussion has been closed.
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