What will happen on a defaulted loan

cram1971

Post removed to protect friends anonymity thanks for the responses

Jim2007

Two thoughts come to mind:

- Get a judgement against your friend and instruct the Sheriff to sell of his assets up to the value of the loan.

- Factor the debt to a third party, so it is no longer their problem. In this case expect ruff times as these guy will not be to concerned about customer relations if you know what I mean....

Jim.

cram1971

I'd say his assets might be 2% of the loan, as for factor the debt is a possibility but the lending bank is BOI

30lady

once the bank get a judgment they can persue it in one or all of 6 ways - one being like you say judgment mortgage, which can be on the property for 12 years. So if in positive equity in a number of years bank can try force sale of house to clear judgment. Another way is to bring him to court for an assessment of means and installment order, which if I was the bank I would chose this, as if he was paying €400 per month he must have some income therefore is able to make a payment.

Also if he is able to pay any little bit he should do so to reduce his debt.
Once they get judgment the interest is 8% per annum too I think, so if he put a monthly offer in now before it goes to the solicitors and asked them to stop interest and charges and not go for judgment at all it be cheaper.

If he wants free advice and 100 % facts on above on this he should ring MABS

cram1971

30lady wrote: »

once the bank get a judgment they can persue it in one or all of 6 ways - one being like you say judgment mortgage, which can be on the property for 12 years. So if in positive equity in a number of years bank can try force sale of house to clear judgment. Another way is to bring him to court for an assessment of means and installment order, which if I was the bank I would chose this, as if he was paying €400 per month he must have some income therefore is able to make a payment.

Also if he is able to pay any little bit he should do so to reduce his debt.
Once they get judgment the interest is 8% per annum too I think, so if he put a monthly offer in now before it goes to the solicitors and asked them to stop interest and charges and not go for judgment at all it be cheaper.

If he wants free advice and 100 % facts on above on this he should ring MABS

Thanks 30lady, I have suggested he contacts MABS, I think at the moment he feels like he is such a hole there is now way at the moment to pay. He was told by a lender that they do not have to accept MABS suggestions which I would guess would be the case.

30lady

no they don't have to accept mabs suggestions but if it does go to court it will prove he has done his utmost in dealing with his debt in his circumstances.
A good thing (I think) about going to MABS is this guy will get the full info of the consequences and make sure whatever he does offer the bank is affordable and sustainable

cram1971

30lady wrote: »

no they don't have to accept mabs suggestions but if it does go to court it will prove he has done his utmost in dealing with his debt in his circumstances.

Very good point. I am actually reading the MABS site now some interesting tips there, I wish I read it myself as I just refinanced my own car loan a few months ago!

sellerbarry

I would tell your friend to keep paying the 400/month and if that is not possible some months, just pay what he can. I would not listen to all this scaremongering about thugs and the sheriff. If this is all he can pay(really all) after cutting off ntl/sky/phone/broadband etc in the process, then that is all they are getting. You say he has no assets, so what's the worst they can do? I have been in this situation and believe me, it's not worth getting worried sick over . If this goes to court and the judge sees that he is paying as much as he can, then the judge will instruct the bank to take what he is giving until his situation improves. It really gets my goat, that people on here are trying to scare people into paying more than they possibly can.These same banks ran the country into the ground and then got a hand out when they went cap in hand to the government and our taxes.!!!!!!!!!!!
Rant over................................

cram1971

sellerbarry wrote: »

I would tell your friend to keep paying the 400/month and if that is not possible some months, just pay what he can. I would not listen to all this scaremongering about thugs and the sheriff. If this is all he can pay(really all) after cutting off ntl/sky/phone/broadband etc in the process, then that is all they are getting. You say he has no assets, so what's the worst they can do? I have been in this situation and believe me, it's not worth getting worried sick over . If this goes to court and the judge sees that he is paying as much as he can, then the judge will instruct the bank to take what he is giving until his situation improves. It really gets my goat, that people on here are trying to scare people into paying more than they possibly can.
Rant over................................

Thanks .. I do believe the banks will treaten some sort of legal action, I also think things will improve for him in a year or so. I think the MABS route is probably the best option if I can convince him

sellerbarry

cram1971 wrote: »

Thanks .. I do believe the banks will treaten some sort of legal action, I also think things will improve for him in a year or so. I think the MABS route is probably the best option if I can convince him

I agree totally with the mabs route too. But tell him not to let this get him really down. That's when the problems really start re depression etc. It will get better for him. Believe me..........

30lady

cram1971 wrote: »

Very good point. I am actually reading the MABS site now some interesting tips there, I wish I read it myself as I just refinanced my own car loan a few months ago!

depending on your situation whomever you have the loan with may be open to negotiations again especially if you hadn't factored in Decembers budget hacking away some of your income...

cram1971

That is why I am happy he is talking to me.

To many people are taking drastic actions in these times and no bank is worth that

sellerbarry

cram1971 wrote: »

That is why I am happy he is talking to me.

To many people are taking drastic actions in these times and no bank is worth that

Exactly;)