Buying a house in Negative Equity

missjuly

Yeah I suppose you are right iguana! Its just such a difficult situation as I know everyone here will probably agree. its just a tough road to take and a long one (though I was relatively lucky with it "only" taking 7 months). Just a little advice that applied to our situation anyway....if you have been waiting a good while it is no harm to get your solicitor to send a letter to say if there is no movement in x amount of days you are pulling out- we got word within a day after solicitor sent said letter that venders had signed an agreement with the bank. I know it could have been coincidence or luck but I feek bank had offered deal and they weren't happy with it but letter pushed them. Obviously won't apply to alot of situations but I feel it must in the ones were it is going on for over a year at the very least. I was afraid to send it cause knew I didn't want to pull out, plus it still doesn't mean you have to!

jfmac

Hi all
i wrote here back in july i think it was about buying a house which we didn't know was in NE. Nobody not even our solicitor told us it was!! In the end the vendors pulled out as they couldn't come to an agreement with banks.
Now we find ourselves in a similar situation (GLUTTONS FOR PUNISHMENT!)
We have a booking deposit on a house in NE that we both love and perfect location.This time we are going in with eyes open. We sale agreed in Aug and still nothing. When we ring auctioneer its one excuse after another. Apparently we'll have the consent to sell letter from the bank 'soon'... My question that i hope ye can help me with is, once that letter is issued is the rest of the process straightforward? ie just sign contracts etc? I know the vendors have paid the NPPR. Will this help?
Thanks:)

2013Lara

jfmac wrote: »

Hi all
i wrote here back in july i think it was about buying a house which we didn't know was in NE. Nobody not even our solicitor told us it was!! In the end the vendors pulled out as they couldn't come to an agreement with banks.
Now we find ourselves in a similar situation (GLUTTONS FOR PUNISHMENT!)
We have a booking deposit on a house in NE that we both love and perfect location.This time we are going in with eyes open. We sale agreed in Aug and still nothing. When we ring auctioneer its one excuse after another. Apparently we'll have the consent to sell letter from the bank 'soon'... My question that i hope ye can help me with is, once that letter is issued is the rest of the process straightforward? ie just sign contracts etc? I know the vendors have paid the NPPR. Will this help?
Thanks:)

In our situation, the consent letter arrived months ago. But it was subject to terms that the vendor had to agree to. He didn't agree to them so it has taken another 3 or 4 months since the consent letter arrived to actually get anywhere. In my case the consent only marked the beginning of their negotiations with their bank.

Ms2011

One year today since we paid our booking deposit....Happy Anniversary to us :rolleyes:

Hillybilly4

Ms2011 wrote: »

One year today since we paid our booking deposit....Happy Anniversary to us :rolleyes:

LOL. Happy Anniversary indeed! Soon be there ourselves at this rate!!!

Hillybilly4

Surprised update. Heard from our solicitors this morning and we finally have a closing date for next Friday!

2013Lara

Hillybilly4 wrote: »

Surprised update. Heard from our solicitors this morning and we finally have a closing date for next Friday!

Congrats hillybilly! Fingers crossed for plain sailing from here. Good luck in your new home, enjoy it.

Locoladee

Another update on my situation-over 6 months in, contracts signed and closing date was 2 weeks ago, my solicitor asked me to get my bank to release the mortgage for that date which they did, but my solicitor never received returned contracts from other side. When she queried this she was told by other side's solicitor that he still had one or two documents outstanding from his client and he hoped we would close very shortly. Have since found out, by phoning the auctioneer, not from other side's solicitors, (but who had to admit it eventually) and asking what was the holdup, that the vendor hasn't paid her NPPR. She owes the max amount which is €7,230, but does not have it. This was not included in the initial consent to sell from the bank so her solicitor has had to go back to the bank and ask them to reduce the house price to include the 7 grand. My solicitor says it is extremely unlikely that this will happen. Basically, my options are to pay this person's tax for them which I can not afford, wait it out until the bank decides (which could be months), or walk away. I am disgusted that I got to this stage without anyone picking up on it, but at this stage NOTHING surprises me about this sorry process. Does anyone know or have any experience with dealing with County Councils on this matter? Is it at all possible to get any kind of reduction on the amount as it is not my tax? Or can it be paid in installments? I am so angry that this tax follows the house, not the person, who received rent on the property. What a joke. Oh, and I'm not paying house insurance and mortgage protection on a house I do not even own!!!! My first payment on the mortgage is due in a few weeks but my solicitor cant hold the mortgage for that long, if we dont sort something out in the next few days she will have to send the funds back to the bank. So tempted to jack it all in and continue to rent. It's so not worth this.

Locoladee

Another update on my situation-over 6 months in, contracts signed and closing date was 2 weeks ago, my solicitor asked me to get my bank to release the mortgage for that date which they did, but my solicitor never received returned contracts from other side. When she queried this she was told by other side's solicitor that he still had one or two documents outstanding from his client and he hoped we would close very shortly. Have since found out, by phoning the auctioneer, not from other side's solicitors, (but who had to admit it eventually) and asking what was the holdup, that the vendor hasn't paid her NPPR. She owes the max amount which is €7,230, but does not have it. This was not included in the initial consent to sell from the bank so her solicitor has had to go back to the bank and ask them to reduce the house price to include the 7 grand. My solicitor says it is extremely unlikely that this will happen. Basically, my options are to pay this person's tax for them which I can not afford, wait it out until the bank decides (which could be months), or walk away. I am disgusted that I got to this stage without anyone picking up on it, but at this stage NOTHING surprises me about this sorry process. Does anyone know or have any experience with dealing with County Councils on this matter? Is it at all possible to get any kind of reduction on the amount as it is not my tax? Or can it be paid in installments? I am so angry that this tax follows the house, not the person, who received rent on the property. What a joke. Oh, and I'm now paying house insurance and mortgage protection on a house I do not even own!!!! My first payment on the mortgage is due in a few weeks but my solicitor cant hold the mortgage for that long, if we dont sort something out in the next few days she will have to send the funds back to the bank. So tempted to jack it all in and continue to rent. It's so not worth this.

leinster93

Locoladee wrote: »

Another update on my situation-over 6 months in, contracts signed and closing date was 2 weeks ago, my solicitor asked me to get my bank to release the mortgage for that date which they did, but my solicitor never received returned contracts from other side. When she queried this she was told by other side's solicitor that he still had one or two documents outstanding from his client and he hoped we would close very shortly. Have since found out, by phoning the auctioneer, not from other side's solicitors, (but who had to admit it eventually) and asking what was the holdup, that the vendor hasn't paid her NPPR. She owes the max amount which is €7,230, but does not have it. This was not included in the initial consent to sell from the bank so her solicitor has had to go back to the bank and ask them to reduce the house price to include the 7 grand. My solicitor says it is extremely unlikely that this will happen. Basically, my options are to pay this person's tax for them which I can not afford, wait it out until the bank decides (which could be months), or walk away. I am disgusted that I got to this stage without anyone picking up on it, but at this stage NOTHING surprises me about this sorry process. Does anyone know or have any experience with dealing with County Councils on this matter? Is it at all possible to get any kind of reduction on the amount as it is not my tax? Or can it be paid in installments? I am so angry that this tax follows the house, not the person, who received rent on the property. What a joke. Oh, and I'm now paying house insurance and mortgage protection on a house I do not even own!!!! My first payment on the mortgage is due in a few weeks but my solicitor cant hold the mortgage for that long, if we dont sort something out in the next few days she will have to send the funds back to the bank. So tempted to jack it all in and continue to rent. It's so not worth this.

Sorry to hear your situation. First off your solicitor should not have got you to draw down on the mortgage without all details being confirmed which includes the NPPR.
We were in a similar situation a few weeks back and our solr asked for confirmation of payment of NPPR which took the seller's solr 5 weeks to confirm. I phoned the revenue commissioners and they emphasised that the NPPR was the seller's liability and we as the buyers should not pay this if there was anything due. Although we were tempted to pay it just to get the close of sale we didn't. We held out. Seller made payment eventually. Although slightly different to you as the seller made payment you have a contract in place with agreed price. Your situation will probably delay things for a further 6 months but you should consider will a further delay be worth it. It took 1 year for our sale to close. A nightmare of a journey for us but every cloud has a silver lining. If you hold out is it worth it? That is the question you should ask yourself. We asked ourselves is it worth it...either walk away now or hold out.
hope it all works out.

Locoladee

leinster93 wrote: »

Sorry to hear your situation. First off your solicitor should not have got you to draw down on the mortgage without all details being confirmed which includes the NPPR.
We were in a similar situation a few weeks back and our solr asked for confirmation of payment of NPPR which took the seller's solr 5 weeks to confirm. I phoned the revenue commissioners and they emphasised that the NPPR was the seller's liability and we as the buyers should not pay this if there was anything due. Although we were tempted to pay it just to get the close of sale we didn't. We held out. Seller made payment eventually. Although slightly different to you as the seller made payment you have a contract in place with agreed price. Your situation will probably delay things for a further 6 months but you should consider will a further delay be worth it. It took 1 year for our sale to close. A nightmare of a journey for us but every cloud has a silver lining. If you hold out is it worth it? That is the question you should ask yourself. We asked ourselves is it worth it...either walk away now or hold out.
hope it all works out.

Thanks Leinster, Ive been asking myself why the hell it wasn't spotted&why U was allowed draw down, I have about 3-4 days to decide what to do, this is my second sale agreed in the past 14 months, first one fell through, so at this stage Im so disheartened by the whole process I seriously couldnt face starting all over again. Added to that is the fact that prices have risen so much over the past year (up to 40,000 for some houses in my area), that most would be outside my budget anyway. I'll prob just go back to renting, this stress has had a ghuge impact on my life I have zero interest in viewing more houses or beginning this ridiculous game all over again for the 3rd time! Hope it works out for everyone else here.

Hillybilly4

Locoladee wrote: »

Have since found out, by phoning the auctioneer, not from other side's solicitors, (but who had to admit it eventually) and asking what was the holdup, that the vendor hasn't paid her NPPR. She owes the max amount which is €7,230, but does not have

Locoladee wrote: »

Does anyone know or have any experience with dealing with County Councils on this matter? Is it at all possible to get any kind of reduction on the amount as it is not my tax? Or can it be paid in installments?

We've had to agree to pick up the NPPR tab on the repossession we're buying. "Fortunately" we began speaking to the County Council about this possibility before all the late payment fines were imposed and we've got the NPPR liability down to just over £4k. The NPPR officers do have the "power" to exercise fair judgement (not the right word but can't think what the correct one is right now!) over the amount "due" and also to agree payment terms. We were fortunate enough to get to deal with a very fair and understanding guy in the NPPR dept. (We did this legwork ourselves). Also, our solicitor has just told us that it is in fact not necessary to actually pay the NPPR before closing, as long as we, the buyers, are aware that it remains a charge over the property until paid or waived. (Or I guess becomes null and void after 12 years!). We hope to be able to contest at least some if not all of the £4k once we're the owners. Hope this is of some help.

Hillybilly4

Discretion! That was the word I was looking for lol.

Locoladee

Wow Hillbilly that is fantastic news!!! I will get onto the council tomorrow, and start begging!;) even if they waived the late fee that cane in on September 1st? Or if I could just pay it in installments this would be an easier option, rather than lose the house after all this torture! You have been a great help, thanks a million!:):):)

Hillybilly4

Did you manage to get to speak to anyone yet Locoladee?

Locoladee

Hillybilly4 wrote: »

Did you manage to get to speak to anyone yet Locoladee?

Still waiting on a decision from the council, hoping for a bit of a reduction but Im wary of this happening, apparently they are dealing with a lot of similar cases just fed up waiting for answers at this stage, will keep ye posted here.

phater phagan

I made a cash offer in October 2013 on a two bedroom apartment which was accepted by vendor and bank etc. Like most people on this thread I was unaware of its negative equity status. The vendor's solicitor also lost some of the legal papers, and he kept obfuscating the situation. Luckily I managed to get into my apartment under a Caretaker Agreement in June 2014 without obligation of having to pay rent; which means that I can live here for as long as it takes. and it relieved some of the angst that I had prior to June.
The vendor's solicitor has finally agreed to reconstruct the missing documents and are hopeful we can complete the final round and apply for title to the land registry reasonably soon.
My solicitor, who is trustworthy is holding the funds.
When I made the offer a year ago the auctioneer predicted a closing date of Christmas - unfortunately he didn't say which year.

Locoladee

Hope you get sorted soon phater phagan, I empathise with you, the stress of all this rubbish would drive you round the bend! My situation is changing daily. The council initially sent me good vibes of getting a reduction in the NPPR, but head of finance today confirmed that they are unwilling to budge one cent. The full €7230 must be paid. The 'good news' was that they are willing to set up a payment plan for me. Me-not the vendor!!!!! The house can be sold then. I do not understand why the vendor cannot set up a payment plan with them and then the house be released to me??? What the hell is wrong with this country that someone is allowed to run up a debt like this (and by the way this vendor has for many years been receiving rent every month for this property), yet somebody else is expected to pay it? Why the hell does this tax not follow the person who neglected to pay it? Why should I suffer? She made enough money in rent over the years, yet I have to pay her tax on it for her? Im so angry with this whole stupid situation. If it was Local Property Tax it would be deducted from her wages, yet this tax goes with the house. This country is a total joke. Sick to the back teeth of this whole mess.

phater phagan

Thanks Locoladee for your good wishes, and I return the sentiments for your situation. It is of course very frustrating. It's lamentable, that important decisions which affect people's lives are handled in such a desultory fashion by civil and civic authorities. I'm concerned now about NPPR as the apartment was not a primary residence and I imagine when I get title I will also be confronted with the tax bill. I'm surprised that no one has set up a Title Insurance Company similar to what they have in America. It makes the process of purchasing a property a much smoother, and quickly provides the purchaser with information all liens or encumbrances on title. It also acts as an Escrow company. Of course, such a service would put many solicitors out of business, so I can't see it ever happening here.

Hillybilly4

:eek: We just heard from our solicitor that we have indeed closed today! (32 weeks from offer accepted by bank in possession).

phater phagan

Good news indeed Hillbilly. Congratulations to you and wishing you much happiness in your new home.

Marcin Z

Today I made an offer on 2bed apartment that has been repossessed by Permanent TSB. Which means if my offer goes through i'll be dealing with a bank . EA said this property is in negative equity and she's guessing something around 60k. I like this duplex and the price is relatively low, that's why I'm willing to wait and be patient. I think she's happy with my offer because already asked me for proof of mortgage approval.
I read most of this thread and I know what most of you went through. I have to bare in mind that by the time the sale comes to an end, my sanction in principle might be no longer valid. There are new regulations coming up and I might be hit by the whole mortgage approval process once again which makes me nervous
What would you do? would you take that risk?

2013Lara

Marcin Z wrote: »

Today I made an offer on 2bed apartment that has been repossessed by Permanent TSB. Which means if my offer goes through i'll be dealing with a bank . EA said this property is in negative equity and she's guessing something around 60k. I like this duplex and the price is relatively low, that's why I'm willing to wait and be patient. I think she's happy with my offer because already asked me for proof of mortgage appruoval.
I read most of this thread and I know what most of you went through. I have to bare in mind that by the time the sale comes to an end, my sanction in principle might be no longer valid. There are new regulations coming up and I might be hit by the whole mortgage approval process once again which makes me nervous
What would you do? would you take that risk?

It has already been repossessed so it'll be quicker than some sales on here, but it will be slow. I'd keep your options open and keep looking. It could take weeks for your offer to be accepted/declined. It's not going to be quick, and I wouldn't put any money in to it at all as of yet, tell them your offer will be dependent on your survey etc if it is accepted. Bare in mind you could wait for well over a month for your offer to be declined. So while I wouldn't say not to go for it, make sure you go in with your eyes wide open and know that the process will be slow. At least you know, as the property is already in possession of the bank, that it will definitely be sold to you if your offer is accepted. How long it would take is anyone's guess. You could get lucky! I am the longest here waiting (17 months). Others have been much quicker.

Aka Ishur

Marcin Z wrote: »

Today I made an offer on 2bed apartment that has been repossessed by Permanent TSB. Which means if my offer goes through i'll be dealing with a bank....

There's a little mixed message here. The apartment cant be in negative equity if the bank has it, so it shouldn't come in to the equation. What you need to clarify is if there are receivers between you and the bank or not. Receivers selling on behalf of the bank is an extra headache.

You're main headache also will be searches and getting good title. Make sure you have a solicitor who will keep you in the loop!

Marcin Z

Aka Ishur wrote: »

There's a little mixed message here. The apartment cant be in negative equity if the bank has it, so it shouldn't come in to the equation. What you need to clarify is if there are receivers between you and the bank or not. Receivers selling on behalf of the bank is an extra headache.

You're main headache also will be searches and getting good title. Make sure you have a solicitor who will keep you in the loop!

Good that you noticed this. She never mentioned any other party but it's worth to checking that out with my solicitor. It could be that she's not informed well and just made that out.
Hopefully the bank will accept my offer. Look forward to hearing from her

on_my_oe

As the others say, it'll take a while for the bank to respond, a couple of months potentially. Ours took four months (declined). In the end we hedged our bets and kept looking at other properties just in case. I know there isn't much choice in the Dublin market though, so fingers crossed

Marcin Z

on_my_oe wrote: »

As the others say, it'll take a while for the bank to respond, a couple of months potentially. Ours took four months (declined). In the end we hedged our bets and kept looking at other properties just in case. I know there isn't much choice in the Dublin market though, so fingers crossed

four months and declined? o.0 These greedy bankers knew that the prices will go up eventually. My property its been on the market since september and I already offered 11k over asking price. Well, I guess that their asking price went up at least once during these 3 months plus my 11k on the top of that. Hope that should makes them happy. Otherwise they can shove this up their a**

Marcin Z

Aka Ishur wrote: »

There's a little mixed message here. The apartment cant be in negative equity if the bank has it, so it shouldn't come in to the equation. What you need to clarify is if there are receivers between you and the bank or not. Receivers selling on behalf of the bank is an extra headache.

You're main headache also will be searches and getting good title. Make sure you have a solicitor who will keep you in the loop!

Aka Ishur i'm afraid you're right. Today I got an email from my EA and she said that had submitted my offer to the RECEIVERS dealing with property. I asked her who are these Receivers and I thought I'll be dealing with a bank. She hasn't responded to my email.

Does anyone of you had been dealing with Receivers selling on behalf of the bank?

TheDriver

in theory a receiver is a better bet because they make a decision whereas a bank needs to get the "committee" to approve things which can take longer. However be warned that a receiver can't answer a lot of questions on the contract, queries such as planning permission, development of the property etc.

Aka Ishur

Marcin Z wrote: »

Aka Ishur i'm afraid you're right. Today I got an email from my EA and she said that had submitted my offer to the RECEIVERS dealing with property. I asked her who are these Receivers and I thought I'll be dealing with a bank. She hasn't responded to my email.

Does anyone of you had been dealing with Receivers selling on behalf of the bank?

Key now for you is if you trust your solicitor to be very diligent in keeping you informed and keeping the receivers on their toes. As theDriver said, getting answers is the tough job so that your solicitor can give your bank undertaking that the title is clean. Of course if you are not getting a mortgage that isn't an issue.