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Collateral Question

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  • 19-02-2014 11:31pm
    #1
    stainluss
    Registered Users Posts: 864 ✭✭✭


    I understand that there is a 6 year hold on assets once they are inherited (i.e. upon issuance of a grant) so that they may not be sold in that period.

    Can they still be used as collateral for a loan?

    Any help appreciated :)
    Tagged:


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    #2
    nlgbbbblth
    Closed Accounts Posts: 5,668 ✭✭✭nlgbbbblth


    Any security held by the bank cannot be sold unless the bank consent to the sale.

    If they can take a legal charge over it then it can be pledged as security.


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    #3
    stainluss
    Registered Users Posts: 864 ✭✭✭stainluss


    nlgbbbblth wrote: »
    Any security held by the bank cannot be sold unless the bank consent to the sale.

    If they can take a legal charge over it then it can be pledged as security.

    Thanks for the response.

    In the eyes of the law, is using an asset as collateral as good as selling that asset?


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    #4
    nlgbbbblth
    Closed Accounts Posts: 5,668 ✭✭✭nlgbbbblth


    No - you are still the legal owner but the bank has rights i.e. the power to call up their loan and realise their security if you default.


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    #5
    stainluss
    Registered Users Posts: 864 ✭✭✭stainluss


    nlgbbbblth wrote: »
    No - you are still the legal owner but the bank has rights i.e. the power to call up their loan and realise their security if you default.

    Oh ok, so if one were to default before the 6 year limit they would have to pay the back taxes because they lose the relief :cool:

    Thanks for your help!


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