Hotel owner with €25m loan refuses repossession order

the_syco

https://www.independent.ie/irish-news/we-have-two-young-children-dublin-family-refusing-to-leave-their-home-after-attempted-repossession-37960720.html

The possession order stems from a €25m loan from Irish Nationwide during the boom over a failed hotel project.

This morning a man and woman arrived at the property to carry out a repossession order on behalf of receiver Paul McCann, of Grant Thornton.

Mr McCann was appointed as a receiver by Kenmare Property Finance, an Irish-based subsidiary of Goldman Sachs.

However, the family this morning refused to leave their home, with Mr Halpin saying the ongoing fight for their home and business as nearly put him in the grave.

“This has nearly brought me into the grave. We have done nothing wrong. Goldman Sachs have bought this loan, we never borrowed a shilling from Goldman Sachs.

Not very surprising. I'm sure the usual "refuse to pay anything" will be at his door at the next repossession attempt?

beauf

Seems like there is legal dispute around if the family home was collateral for the business loan, which collapsed. It sounds like they pay the mortgage for the family home. But it's not about that.

zreba

I've basically zero empathy towards these guys TBH.

Ray Palmer

They have €1.25 million but have nowhere to go? I dont understand that part at all. It also seems it has been cleared in court that the house was used a collateral so subject to repossession.

I do find it disingenuous for him to point out the bank repossesing the house didn't give the original loan. Goldman sachs have since bought the debt and the couple still owe the money. If he doesn't want to be repeatedly brought to court he just needs to stop trying to stall.

Phileas Frog

“This has nearly brought me into the grave. We have done nothing wrong. Goldman Sachs have bought this loan, we never borrowed a shilling from Goldman Sachs."

Other than not paying your debts of course...

zreba

They're doing what's in their interest. Stay in the property as long as they can. It's a disgrace the Irish legislation allows that. One of the reasons why Irish people pay double the interest rates on mortgages then the other Europeans.

"The law of unintended consequences".

amcalester

zreba wrote: »

They're doing what's in their interest. Stay in the property as long as they can. It's a disgrace the Irish legislation allows that. One of the reasons why Irish people pay double the interest rates on mortgages then the other Europeans.

"The law of unintended consequences".

That's the thing that galls me about these people, I'm effectively paying €150 per month so he, and others like him, can stay in his €1m+ house.

It's a disgrace.

zreba

amcalester wrote: »

That's the thing that galls me about these people, I'm effectively paying €150 per month so he, and others like him, can stay in his €1m+ house.

It's a disgrace.

What's really pathetic is that people don't see or refuse to admit there's a direct link between the 'anti reposession' sentiments and citizens paying exaggerated interest rates on mortgages.

V Eight

amcalester wrote: »

That's the thing that galls me about these people, I'm effectively paying €150 per month so he, and others like him, can stay in his €1m+ house.

It's a disgrace.

........that's probably true, and we're also paying for his failed dream to be filthy rich.

myshirt

He is actually smart here when he says he will offer the value of the asset to them, rather than the asset which is what they want.

He has a point which everyone should pay attention to. If you are late on say 1 payment on your mortgage on a standard 3 bed, they'll be with strict insistence that you broke the terms of the loan and they want the property. However restitution is as valid a remedy as any, and Goodman Sachs or any other shouldn't get to dictate what the remedy is if this man can prove no loss to them. He has property rights and it is the family home, no matter how jealous everyone is of it.

Why it's been played out in public I don't know.

Remember all that law is is one group of people's rules being imposed on others. Unless we have diversity in law making we will never get a fair shake for everyone. And we don't have the diversity.

amcalester

myshirt wrote: »

He is actually smart here when he says he will offer the value of the asset to them, rather than the asset which is what they want.

He has a point which everyone should pay attention to. If you are late on say 1 payment on your mortgage on a standard 3 bed, they'll be with strict insistence that you broke the terms of the loan and they want the property. However restitution is as valid a remedy as any, and Goodman Sachs or any other shouldn't get to dictate what the remedy is if this man can prove no loss to them. He has property rights and it is the family home, no matter how jealous everyone is of it.

Why it's been played out in public I don't know.

Remember all that law is is one group of people's rules being imposed on others. Unless we have diversity in law making we will never get a fair shake for everyone. And we don't have the diversity.

I get the impression that he expects the settlement to be limited to the value of the house, i.e. if he pays off the house he's free and clear whereas Goldman Sachs will want both, the cash and the house.

Ray Palmer

Myshirt:
He is trying to make that argument but it is incredibly weak one to make.
The suggestion applied to retail would apply like this,
Shop buys X for €6 and sell at €10. Customer comes in and says I know X only cost €6 so I will pay €8. The shop refuses and the customer says you dont lose any money so it is fair.

He does not get to dictate how much profit a company makes on their dealings. He and you are ignoring the length of time and costs of the process. He owes the money the fact the debt was sold doesn't stop him owing the money. He owes more than the value of the house and should lose the money and the house in reality.

seamus

myshirt wrote: »

He is actually smart here when he says he will offer the value of the asset to them, rather than the asset which is what they want.

He has a point which everyone should pay attention to. If you are late on say 1 payment on your mortgage on a standard 3 bed, they'll be with strict insistence that you broke the terms of the loan and they want the property. However restitution is as valid a remedy as any, and Goodman Sachs or any other shouldn't get to dictate what the remedy is if this man can prove no loss to them.

That's a bit disingenuous. Nobody has ever had a bank demanding possession over a single missed payment.

Ultimately Goldman Sachs haven't dictated the remedy here. A court has. A repossession order has been granted, so one has to assume that the court was not satisfied that such an order was not in breach of their family home protections.

Maybe they do have somewhere else to go, and indeed the existence of €1.25m would indicate that they have more than sufficient capacity to purchase another property.

Goldman Sachs' argument would likely be down to the future value of the property rather than the current value. That is, that possession of the property would allow the bank to realise value gains through development or inflation on the property. These gains wouldn't be realised on a 1.25m repayment.

JimmyMW

myshirt wrote: »

However restitution is as valid a remedy as any, and Goodman Sachs or any other shouldn't get to dictate what the remedy is if this man can prove no loss to them. He has property rights and it is the family home, no matter how jealous everyone is of it.

Id imagine that is not the terms signed up to, if the house was put up as collateral and they signed the dotted line, family home or not, they are well within their rights to reposes it. This is not like people being evicted from their lands following the occupation of the British, they were well aware of the risks when they took the loan.

Yurt2

amcalester wrote: »

That's the thing that galls me about these people, I'm effectively paying €150 per month so he, and others like him, can stay in his €1m+ house.

It's a disgrace.

Partly true. There is of course an element of profiteering in that extra 150 euro. There are a lot of low-rate tracker mortgages on the bank's books, which make the banks very little money so they push the cost on to other borrowers and bleed them dry. So yes, the repossession issue contributes to situation, but it's not the full picture.

Same trick the car insurance industry pulls; yes, bogus claims and high-payouts are problem, but I'm not convinced that it's such a large problem to justify an average annual premium of 900 euro.

amcalester

Yurt! wrote: »

Partly true. There is of course an element of profiteering in that extra 150 euro. There are a lot of low-rate tracker mortgages on the bank's books, which make the banks very little money so they push the cost on to other borrowers and bleed them dry. So yes, the repossession issue contributes to situation, but it's not the full picture.

Same trick the car insurance industry pulls; yes, bogus claims and high-payouts are problem, but I'm not convinced that it's such a large problem to justify an average annual premium of 900 euro.

That's a fair point, but it's telling that we've had no challenger banks come into the market.

These banks that wouldn't be weighed down by previous tracker mortgages etc. Now I know there are other reasons for this too but it still stick in the craw.

zreba

The old trackers are less and less reason of high mortgage rates in Ireland. The big issue lies with the regulation and processes leading to banks being unable to take back the property when mortgage isn't being paid back. The gov puts a blame on trackers because they're afraid of losing elections if they do anything to enable easier reposessions. At the end of the day it's the regular Joe who casts the vote who's to blame. We chose to offer high protection to non-payers, but this comes with a significant financial cost to other mortgage holders.

Amirani

Yurt! wrote: »

Partly true. There is of course an element of profiteering in that extra 150 euro.

Well they do make a profit on the loans, yes. But the profitability of Irish banks isn't high by European standards, so it's not like they're gouging huge profits off mortgage loans.

partyguinness

Ireland is a very small market- an island of 4m people so competition is not great. A lot of companies across various industries cldnt be arsed setting up in Ireland.

You can pretty much count the main stream lenders in Ireland on one hand.

handlemaster

They want the public to get behind them say they have no where to go, yet still have over million to offer the bank. Hopefully the sick irish pu liv wont fall again for the this pity story. You borrow the money you owe it.

handlemaster

They want the public to get behind them say they have no where to go, yet still have over million to offer the bank. Hopefully the sick irish pu liv wont fall again for the this pity story. You borrow the money you owe it.

dubrov

handlemaster wrote:

They want the public to get behind them say they have no where to go, yet still have over million to offer the bank. Hopefully the sick irish pu liv wont fall again for the this pity story. You borrow the money you owe it.

Sadly they will get a much better deal with the bank by going down this route.

irishgeo

You home may be at risk if you fail to pay back any loan secured against it.

Thats on every loan document. People might have some sympathy if they weren't in a multi million pound house.

The quinn children are no better. Daddy made us sign put we didn't know what we were signing. While stashing money/assets in foreign countries.

handlemaster

irishgeo wrote: »

You home may be at risk if you fail to pay back any loan secured against it.

Thats on every loan document. People might have some sympathy if they weren't in a multi million pound house.

The quinn children are no better. Daddy made us sign put we didn't know what we were signing. While stashing money/assets in foreign countries.

Brass necks . Lots of pennyless fools lapping up to the poor mouth story..

Del2005

Yurt! wrote: »

Partly true. There is of course an element of profiteering in that extra 150 euro. There are a lot of low-rate tracker mortgages on the bank's books, which make the banks very little money so they push the cost on to other borrowers and bleed them dry. So yes, the repossession issue contributes to situation, but it's not the full picture.

Same trick the car insurance industry pulls; yes, bogus claims and high-payouts are problem, but I'm not convinced that it's such a large problem to justify an average annual premium of 900 euro.

Where trackers only sold in Ireland? Because other European banks would have the same tracker hangover, ours are the only ones that can't recover loans.

partyguinness wrote: »

Ireland is a very small market- an island of 4m people so competition is not great. A lot of companies across various industries cldnt be arsed setting up in Ireland.

You can pretty much count the main stream lenders in Ireland on one hand.

If the market was profitable then companies would be rushing in. The fact that we have the highest interest rates, and car insurance premiums, yet not a single new entrant has entered the market shows that our systems are broken but no one will fix them.

seligehgit

TBF the lack of competition in the Irish mortgage market and resultant high interest rates is a separate argument from a case where an individual arguing the point as to whither the family home was used as a security on a loan.

Del2005

seligehgit wrote: »

TBF the lack of competition in the Irish mortgage market and resultant high interest rates is a separate argument from a case where an individual arguing the point as to whither the family home was used as a security on a loan.

The fact that a bank can't get access to the collateral for a loan is the same regardless of why they can't access it. So this case is a reason why we have such high interest rates.

zreba

Del2005 wrote: »

Where trackers only sold in Ireland? Because other European banks would have the same tracker hangover, ours are the only ones that can't recover loans.




If the market was profitable then companies would be rushing in. The fact that we have the highest interest rates, and car insurance premiums, yet not a single new entrant has entered the market shows that our systems are broken but no one will fix them.

Trackers are still popular in Europe, banks here miscalculated the risk and put too low premium % on top of the ECB rate and that's why they struggle now. European banks put similar premiums to Irish banks, but risks in most European countries did not materialize. Variable rates are kind of a safety switch for Irish banks as banks can change the interest rates as they wish and whenever they wish. They hit a trouble - they increase variable rates and it's all legal as variable rates aren't linked to any international index or ECB rate. Mortgage holders will pay.

Marcusm

beauf wrote: »

Seems like there is legal dispute around if the family home was collateral for the business loan, which collapsed. It sounds like they pay the mortgage for the family home. But it's not about that.

Going into the detail of it, there is no family owned home. There is a company owned and mortgages commercial B&B premises in which the family of the operator live. There seems to be little social utility in this family being permitted to continue occupying a property valued at 2m or 3m depending on who you believe. I don’t see heart strings to be pulled. Personal tragedies aside, it’s like the Clontarf example a few weeks ago. Others have more modest homes or are in B&B accommodation as “guests” not operators.

The_Conductor

zreba wrote: »

Trackers are still popular in Europe, banks here miscalculated the risk and put too low premium % on top of the ECB rate and that's why they struggle now. European banks put similar premiums to Irish banks, but risks in most European countries did not materialize. Variable rates are kind of a safety switch for Irish banks as banks can change the interest rates as they wish and whenever they wish. They hit a trouble - they increase variable rates and it's all legal as variable rates aren't linked to any international index or ECB rate. Mortgage holders will pay.

The norm in most European countries- is an interest rate fixed for the duration of the mortgage- or alternatively a variable rate product- but not a 'tracker' mortgage (a la what us Irish would recognise a tracker mortgage to be).

Ireland was not unique in the manner in which we embraced tracker mortgages- but the extent to which they superceded every other mortgage type- and the complete lack of a fixed rate product for the term of the mortgage- even today- are startling- if you compare Irish products with those on the Dutch, Belgian or German markets (for example).

The_Conductor

beauf wrote: »

Seems like there is legal dispute around if the family home was collateral for the business loan, which collapsed. It sounds like they pay the mortgage for the family home. But it's not about that.

There is an argument to be made that the property in question is not necessarily entitled to the protections of the family home- given it is run as a successful Bed and Breakfast.