Struggling homeowners urged to 'help themselves'--Irish Independent Jan 12th

Klingon Hamlet

But I thought repossessions were under a new moratorium act, no...?

The Article Online

By Dearbhail McDonald Legal Editor

Tuesday January 12 2010

A JUDGE yesterday urged distressed homeowners who fall behind on their mortgage repayments to "help themselves" and stay in negotiations with their lenders.

Mr Justice Brian McGovern said unemployment was taking its toll on people's hopes for a decent life and home as he ordered the possession of 10 properties.

Judge McGovern adjourned scores of applications until late February owing to increased pressures on the weekly High Court possessions list.

He encouraged homeowners facing possession to stay in touch with their lenders, negotiate at the earliest opportunity and turn up in court when their lenders move against them.

The judge described a number of the cases coming before him as "pretty hopeless", with several loans falling into arrears shortly after mortgage loans were drawn down.

In one case, a separated husband and wife drew down a €338,000 loan from subprime lender Start Mortgages in January 2008. The couple, who were paying a mortgage of €2,600 a month, stopped making payments shortly after they drew down their loan, amassing arrears of almost €60,000.

Unemployment led to the granting of an order for possession against another married couple who have four children. The High Court heard that the husband, who was previously employed as a site foreman, was now out of work.

Arrears

The father, from Wexford, had offered to pay €400 a month to meet his €83,766 debt, including some €17,000 in arrears.

Describing the man as "another victim of the construction slump", the judge added that the application by Start Mortgages was "another sad case of unemployment taking its toll on people's hopes for a decent life and home".

An order for possession was also granted to Start Mortgages against a couple with four children who took out two loans, one to remortgage their home to facilitate home improvements. The couple, who owe €252,297, could not meet their monthly repayments and had not done so since October 2008.

In another case, a father of three from Clara, Co Offaly, appeared in person and offered the entirety of his forthcoming redundancy package to save his home by offsetting almost €19,000 in mortgage arrears.

The High Court heard that his property had depreciated in value to just €90,000 in circumstances where he owes his lender more than €164,500.

The case was adjourned until April.

- Dearbhail McDonald Legal Editor

This is so sad!:(

Agent J

Nope. /Meant with reguard to the moratoruim not the sad part

Think there might be a stay of about 12 months on banks that got bailout money but thats a guidline not a rule.

I think what the judge means is that the homeowners have to play ball. They have to be able to prove they have done their best in trying to pay their mortgage or come to some sort of arrangment with the lender.

If the judge sees that then they can use that to protect them from losing their home.

If the person adopts an ostrich mentality then there is nothing the judge can do even if they want to

Coriolanus

Yep, same with Revenue. Plenty of SMEs are in trouble, and they're not talking to Revenue about it.
When you're in debt, any debt, talk to your creditors. Make any small payment you can make at all, just to show good faith.

Wile E. Coyote

It's a very sad/worrying position for anyone to be in but the judge is right. The only way people can avoid this is if they help themselves by keeping in contact with their mortgage provider. Let them know exactly whats going on and pay what you can when you can. They'll be a lot more helpful if your seen to be making a genuine effort to get back on track.

Victor

Klingon Hamlet wrote: »

But I thought repossessions were under a new moratorium act, no...?

For people who haven't paid in two years? Or indeed anything at all?

Klingon Hamlet

Agent J wrote: »

I think what the judge means is that the homeowners have to play ball. They have to be able to prove they have done their best in trying to pay their mortgage or come to some sort of arrangment with the lender.

If the judge sees that then they can use that to protect them from losing their home.

If the person adopts an ostrich mentality then there is nothing the judge can do even if they want to

Yeah but:

Unemployment led to the granting of an order for possession against another married couple who have four children. The High Court heard that the husband, who was previously employed as a site foreman, was now out of work.

The father, from Wexford, had offered to pay €400 a month to meet his €83,766 debt, including some €17,000 in arrears.

Describing the man as "another victim of the construction slump", the judge added that the application by Start Mortgages was "another sad case of unemployment taking its toll on people's hopes for a decent life and home".

He had a fairly small amount of debt, had offered the repaments towards the overdue amount...and if I interpret this rightly, Start refused his offer, took him to court, the judge acknowledged the family's unfortunate position, along with its willingness to pay €400 a month despite great adversity...and still granted the repossession order! No ostrich mentality, communication between both parties, but Start Mortgages are, from many things I've read, a shark of a bank, unwilling to compromise. And the judge merely stregthened their position, allowing them to destory a family's existence at such a critical time in their lives for what is a relatively small debt. Sick.

Agent J

In one case, a separated husband and wife drew down a €338,000 loan from subprime lender Start Mortgages in January 2008. The couple, who were paying a mortgage of €2,600 a month, stopped making payments shortly after they drew down their loan, amassing arrears of almost €60,000.

This is the key part. It is only my interpretation but reading between the lines they may have not made a serious effort to pay anything to start before the court dates and only offered at court to pay X amount a month. Its almost 2 years late and no payments.

If they had been able to prove they had offers of payments rejected from Start as soon as they got into trouble then the Judge might have had some leeyway.

This is only based on what ive read/heard of similar cases.

However i do agree start mortgages take no prionsers and business practices are vulturous to say the least.

On the other hand there is the moral hazard arguement of if you take a debt out and do not meet it then there has to be conseqeunces.

jdivision

The legislation doesn't apply to subprime lenders afaik

fontinalis

Subprime!! For the leave of sweet f***, anyone who approaches these people are asking for trouble. Say the rate was 7% (not unlikely in the case of subprime) they would be paying close to 2,000 a month in interest alone.

the iceman come

Klingon Hamlet wrote: »

Yeah but:

He had a fairly small amount of debt, had offered the repaments towards the overdue amount...and if I interpret this rightly, Start refused his offer, took him to court, the judge acknowledged the family's unfortunate position, along with its willingness to pay €400 a month despite great adversity...and still granted the repossession order! No ostrich mentality, communication between both parties, but Start Mortgages are, from many things I've read, a shark of a bank, unwilling to compromise. And the judge merely stregthened their position, allowing them to destory a family's existence at such a critical time in their lives for what is a relatively small debt. Sick.

Exactly right,its quite frankly BS if you think any judge in the land really has the power or the will to do anything other than offer sympathy in these kind of situations. Sub Prime are certainly quicker to court but there is a torrent of mortgages in serious trouble when the moratorium is up next month (I think) . Offering a "token" amount in these circumstances even if you are with a convenional lender is only a delaying tactic which ultimately will not be enough unless your circumstances change enough to actually resume full payments. Add to the mix the amount of people on interst only terms that are coming out of them and we have a powder keg situation. The token payment and the "lines of communication" being left open only prolong the enevitable IMO. Bottom line, if you cant afford your mortgage -no matter what your circumstance,you will lose your home eventually,its very sad but what is the alternative? Anybody?