I am one of the 5200 non-performing Ulster Bank mortgages.

Cortexiphan · 15-08-2018 12:11pm #1

I rang Ulster Bank the other day, curious if I was one of the 5200, and they confirmed that I was. Cerberus taking over my mortgage account in October/November. Currently feel sick in my stomach, and haven’t told my OH, as they would stress both of us out.

Have been paying my mortgage the best I could up until December, now paying over the full amount since then. But have accumulated €20k in arrears since I moved into the property in 2007. Was hoping to get a restructure on the mortgage(split mortgage/recapitalization) over the last few weeks, but since I’m in arrears the loan has been sold off.

I don’t know what to do now, and have the fear that I will lose my family home. I can afford to pay the mortgage right now, but not sure what to expect from Cerberus, and think they will hike up the repayments that will bankrupt me and they will take my home away.

BrookieD · 15-08-2018 12:16pm

First thing is talk to your partner - how bad would they feel when it comes out in the wash!
Call Cerberus and go through all options - if you bury the head in the sand this may bite way more harder than you ever want.

It is a worry and a hard time but the sooner you engage the sooner you get your plan of action together and the better the outlook. Also contact any help groups. more threads on here for links etc...

Cortexiphan · 15-08-2018 12:24pm

She had a fear that we would lose the house as we had arrears, I told her that once we are in contact with Ulster bank, and are paying the mortgage, we shouldn't worry(this was a over the last few months). Now I worry that we could lose the house, and I told her not to worry.

Right now, I can't contact Cerberus, as the mortgage has yet to be moved to them. I have yet to be formally notified of the move until I receive a letter stating so.

The mortgage is due to be paid today, and I normally call the bank(or call in branch to pay). I don't even know if there is a point in paying it, as since the mortgage has been sold, Ulster Bank would be getting free money for a loan that has already been sold.

I called Ulster bank yesterday to ask a few questions, and they said that if I wish to pay the arrears, I could. But loan will be moved to Cerberus regardless.

troyzer · 15-08-2018 12:26pm

Statistically, you're about five times more likely to be reposessed by the bank than a vulture fund. If you play your cards right, this could work for you. Remember, the vulture fund doesn't think of it in terms of a write down anymore. They bought your loan for cents on the euro, they're much more willing to cut a deal than a bank.

hanaimai · 15-08-2018 12:27pm

The first step is not to panic. There is a lot of unnecessary scaremongering going on in the media at the moment which is terribly unfair to borrowers who may not fully understand what a loan being sold to a vulture fund means for them.

You have the same protections when your loan is owned by a vulture fund as with a bank. Are you in a restructured arrangement at the moment? If you are then Cereberus will have to keep it at least until review time.

Remember that the aim of vulture funds is to make money. The best way they can do that is NOT through repossessions, but by you paying you mortgage. Repossessions take too long and are too expensive - see this article here which even shows that vulture funds repossess much less frequently than banks. So as long as you keep paying and keep engaging you have absolutely no reason to worry about losing your home.

Yes, it is possible that Cereberus will not offer you a particular restructuring arrangement (I know it has been reported they are not keen on split mortgages) but they will want to agree some sort of arrangement so just keep working with them (or more correctly whoever is servicing the loans - you won't be dealing with Cereberus directly).

Basically, don't panic and don't stop paying. You are no more likely to lose your home now as you were before your loan was sold. The most important thing to do is to stick to the terms of whatever repayment arrangement you have, and keep paying towards the arrears whenever you are able.

Gumbo · 15-08-2018 12:29pm

Once you keep paying your mortgage, is there anything to worry about?

amcalester · 15-08-2018 12:30pm

Keep paying the mortgage, getting into further arrears won't help you at all.

Cerberus don't want your home, they're bound by the same agreement as you had with UB so keep paying.

They want a quick settlement of the mortgage or a re-structure to allow them re-sell the mortgage at a profit.

dudara · 15-08-2018 12:32pm

You haven’t received any formal notification from the bank yet, so as far as you’re concerned you’re still dealing with UB. You will receive letters and communications when the mortgage is due to be transferred. So don’t stop paying yet.

Pataman · 15-08-2018 12:33pm

First thing is try not to worry. I have dealt with Cerberus with commercial deal and although they drive a hard bargain, you can get a deal out of them. In the meantime I would try to see if any other broker could get you a mortgage, as Cerberus will cut a deal to close the file.
Best of luck

seamus · 15-08-2018 12:35pm

1. Don't panic. The terms of your mortgage haven't changed. Your legal position hasn't changed. Your legal protections haven't changed.

2. Don't ignore anything. Bring your partner into the loop now, before you're trying to catch the postman in the morning and hide letters under your bed.

3. Keep paying your mortgage and you are not going to lose your home. Courts will not evict families from their homes once they're making an honest attempt to pay.

4. See 3.

5. See 4.

The cause of your panic is mostly coming from the media who would have you believe that Cerberus are going to send men in high-vis jackets down tomorrow to change your locks and dump your stuff out on the street. Nothing has really changed from your point of view except who owns your mortgage.

As others have said here, you should seize this as an opportunity to correct your current financial position and get yourself out of arrears. Look at all of your options, come up with a plan, be ready for when Cerberus do get in contact. Don't let them drive the conversation, don't let them be the ones deciding what happens next. Put reasonable counter-offers to them.

But for the love of everything, keep paying your mortgage.

Hitman3000 · 15-08-2018 12:36pm

Geuze · 15-08-2018 12:38pm

These may help:

https://www.askaboutmoney.com/forums/mortgage-arrears-negative-equity-case-studies.93/

https://www.askaboutmoney.com/forums/mortgages-and-buying-and-selling-homes.2/

randomrb · 15-08-2018 12:40pm

Keep paying your mortgage for definite. As soon as you get confirmation from UB that it has been sold get the contact details of the manager in charge of your file direct number email etc as this saves a lot of time.

You have to remember how much hassle it is for a bank or fund to actually sell a house they just want as much money as they can so ask them to propose a deal, possible go on interest only while you attempt to pay back some of the arrears.

The main thing is to engage with them as otherwise they can't help you.

Geuze · 15-08-2018 12:40pm

As Brendan Burgess says:

"There is a lot of scaremongering going on. The only people who need to worry are those who haven't engaged and who haven't paid anything, and it's about time that they began to worry."

As long as you keep making repayments, then it's very unlikely you'd ever lose your house.

You say that the arrears are slowly being reduced?

BailMeOut · 15-08-2018 12:40pm

When mortgages are sold off like this do the arrears follow as well? i.e. will Cerberus want to collect the OPs €20k he owed in arrears to UB.

OP - this could be a good thing as doing a deal with Cerberus will be a lot easier that with UB.

Turnipman · 15-08-2018 12:44pm

seamus wrote: »

The cause of your panic is mostly coming from the media who would have you believe that Cerberus are going to send men in high-vis jackets down tomorrow to change your locks and dump your stuff out on the street.

.... assisted by opposition politicians whose preference is to get a cheap headline from scaremongering and abusing so-called vulture funds.

seamus · 15-08-2018 12:47pm

BailMeOut wrote: »

When mortgages are sold off like this do the arrears follow as well? i.e. will Cerberus want to collect the OPs €20k he owed in arrears to UB.

OP - this could be a good thing as doing a deal with Cerberus will be a lot easier that with UB.

Yes, that's how it works. The arrears are part of the mortgage.

Imagine:

UB have a mortgage account for 230k, plus 20k in arrears. Cerberus come along and buy the mortgage for 210k. UB get €210k in cash and no longer have to chase the arrears.

Cerberus offer to restructure the mortgage for €240k over a longer term. Then they sell it on to someone else for €245k.

Net profit: €35k (~17%)

Or you get a mortgage somewhere else and Cerberus agree to let you close the account for €240k.

That's illustrative, probably not realistic. But that's what they're at. A trip to the courts to engage in very long, very expensive, and generally futile repossession proceedings, eats into that profit margin.

iwillhtfu · 15-08-2018 12:49pm

Terrible position to be in OP but as above I wouldn't be overly worried just yet and talking this through with your partner will be key, there's nothing to be ashamed of and no point entering this with your eyes closed it will eventually become common place. I'd forget about debt right off as it's your family home you'll be unlikely to want to leave it and I assume that's what part of debt right off plans will be or else relinquish ownership and long term rental.

I'm curious is your home valued higher or lower than the mortgage against it? These companies wouldn't be interested in small returns so unlikely to entertain repossession if property is negative even against what they paid for the mortgage.

Cortexiphan · 15-08-2018 12:55pm

Doubt a deal to pay off the mortgage could be done, close to €300k left to pay. Currently paying €800 a month with the actual mortgage at €750.

My idea of Cerberus was buy the loan cheap, and try to get the house sold ASAP, making quick profit as the current market shows properties coming back into positive equity. I'm find it hard to believe that Cerberus would keep an arrangement in place for the term of a mortgage(30 years?).

Are they going to dictate terms of the loan based on my income, and throw random interest rates too(i'm currently on a special rate from UB of 1.5%)

Also, I purchased the property when I was single, so I am only one on the mortgage account. Does this make a difference when evaluating income into the household, or would they look at all incomes.

Arthur Daley · 15-08-2018 1:02pm

seamus wrote: »

Or you get a mortgage somewhere else and Cerberus agree to let you close the account for €240k.

Because these borrowers are such a great credit risk to take on. Sure the taxpayer has a bottomless pocket.

OhHiMark · 15-08-2018 1:05pm

My friend works for a company like Cerberus. They don't want to take your house and will work with you on a payment plan that works for you. Just don't be an asshole and work with them.

dudara · 15-08-2018 1:15pm

Cerberus aren’t interested in your house per se, they’re interested in the mortgage. Think of it like buying a used car with a bad engine for €2k. They tune it up, clean it up and then sell for €3k.

Cortexiphan · 15-08-2018 1:29pm

dudara wrote: »

Cerberus aren’t interested in your house per se, they’re interested in the mortgage. Think of it like buying a used car with a bad engine for €2k. They tune it up, clean it up and then sell for €3k.

So, they could buy a €300k mortgage from UB for €150k(50c on the Euro), sell it on as a "performing mortgage" for €200k. Do a deal with owner to pay a bit more than the monthly mortgage, for shorter time period, paying back €200k plus some interest.

seamus · 15-08-2018 1:30pm

Arthur Daley wrote: »

Because these borrowers are such a great credit risk to take on. Sure the taxpayer has a bottomless pocket.

What's the taxpayer got to do with it?

Not everyone in this situation is actually a bad credit risk, arrears can just be very difficult to clear if you've only a few hundred quid to play with after your mortgage is paid. If you decided to try and clear your €20k arrears in five years, you'd need to overpay by about €350/month.

But restructuring a mortgage to add on that €20k over 20 years is about €130 a month. Which someone may find tight, but at least possible, unlike €350/month. This person is not a bad credit risk; they may have been solidly repaying for 5+ years, but trying to clear the arrears is just a step too far.

By comparison, arrears are really easily to built up. €20k arrears is just 18 months of non-payment for most people. Which sounds like a lot if you've always paid your mortgage, but if you have no steady work for two years, you end up in this situation before you know it.

draiochtanois · 15-08-2018 1:34pm

This post has been deleted.

davo10 · 15-08-2018 1:36pm

Op, go onto the Today FM website, look for the podcast of yesterday's The Last Word with Matt Cooper. Karl Dietrich did a segment about this, he said VF are far more likely to do a deal with home owners than banks are. It is very informative and hopefully will give you a little peace of mind.

Cortexiphan · 15-08-2018 1:39pm

draiochtanois wrote: »

This post has been deleted.

If that was the case, everyone would jump on it expecting a decent write-down from the Vultures. Saying that, I've heard of them paying 40cent on the Euro.

Cortexiphan · 15-08-2018 1:42pm

davo10 wrote: »

Op, go onto the Today FM website, look for the podcast of yesterday's The Last Word with Matt Cooper. Karl Dietrich did a segment about this, he said VF are far more likely to do a deal with home owners than banks are. It is very informative and hopefully will give you a little peace of mind.

I was listening to that on the way home yesterday, and it was informative, but the arguement against Karl Dietrich(cant remember his name), was very weak, and spiralled towards homelessness instead.

dudara · 15-08-2018 1:42pm

^ Why would they give you a decent write down? They have title to the underlying asset, the house, and can move to repossess and sell if things get bad. It’s just far easier for them to do a deal and sell on the mortgage. Like all businesses they want to maximise their profit.

Arthur Daley · 15-08-2018 1:46pm

seamus wrote: »

What's the taxpayer got to do with it?

Not everyone in this situation is actually a bad credit risk, arrears can just be very difficult to clear if you've only a few hundred quid to play with after your mortgage is paid. If you decided to try and clear your €20k arrears in five years, you'd need to overpay by about €350/month.

But restructuring a mortgage to add on that €20k over 20 years is about €130 a month. Which someone may find tight, but at least possible, unlike €350/month. This person is not a bad credit risk; they may have been solidly repaying for 5+ years, but trying to clear the arrears is just a step too far.

By comparison, arrears are really easily to built up. €20k arrears is just 18 months of non-payment for most people. Which sounds like a lot if you've always paid your mortgage, but if you have no steady work for two years, you end up in this situation before you know it.

They are the definition of a bad credit risk. They are in arrears.

And the taxpayer foots the bill through the bank bailouts. I don't know who you think pays it.

Cortexiphan · 15-08-2018 1:47pm

dudara wrote: »

^ Why would they give you a decent write down? They have title to the underlying asset, the house, and can move to repossess and sell if things get bad. It’s just far easier for them to do a deal and sell on the mortgage. Like all businesses they want to maximise their profit.

I said people may be expecting. I'm not expecting anything favourable, in fact the complete opposite. Read my first post.

Arthur Daley · 15-08-2018 1:48pm

Cortexiphan wrote: »

If that was the case, everyone would jump on it expecting a decent write-down from the Vultures. Saying that, I've heard of them paying 40cent on the Euro.

I think some may already have. This is the problem.

But it does seem the OP is engaging and paying, and they are well advised to continue to pay.

duffman13 · 15-08-2018 1:49pm

draiochtanois wrote: »

Cerberus don't pay anything like 210k for a 230k mortgage, plus 20k in arrears.

It would be a lot more like 80k for a 230k mortgage, plus 20k in arrears.

It wouldn't be the 210k on 230k but the OP was using it was illustrative purposes.

If I was a betting man I'd say Cerberus paid around 55c on the euro based on other sales I've seen. So I'd say 120k approx for the above example.

This mass outcry from the left about vulture funds is bizarre. As has been mentioned you've a far better chance getting debt forgiveness and/or a better restructure than you would be offered by the banks.

You also have the EXACT same legal rights with Cerberus as with Ulster Bank. Making continuous payments will mean you are not at Risk. The ones who have been sitting 10 years barely paying a penny will be taken to the courts and that's what needs to happen in a functioning housing market

OhHiMark · 15-08-2018 1:49pm

Cortexiphan wrote: »

If that was the case, everyone would jump on it expecting a decent write-down from the Vultures. Saying that, I've heard of them paying 40cent on the Euro.

That's exactly how it works. You can go in expecting a decent write-down but if you have that attitude and won't drop it they'll just take the house. You still owe the money no matter how much Cerberus paid for the debt.

duffman13 · 15-08-2018 1:53pm

Cortexiphan wrote: »

If that was the case, everyone would jump on it expecting a decent write-down from the Vultures. Saying that, I've heard of them paying 40cent on the Euro.

You might get some kind of debt forgiveness but these guys are no jokes when it comes to negotiations either. They may write off a portion of arrears but i dont see them taking anything off the principle. 40 cent on the euro is exaggeration IMO

troyzer · 15-08-2018 1:54pm

dudara wrote: »

^ Why would they give you a decent write down? They have title to the underlying asset, the house, and can move to repossess and sell if things get bad. It’s just far easier for them to do a deal and sell on the mortgage. Like all businesses they want to maximise their profit.

They have no chance of repossessing if the mortgage holder is making payments, especially if they're overpaying. That's just not how the courts work in Ireland, why do you think the banks are selling them in the first place?

It's much easier for them to buy it for 40c on the euro, collect a year or two of mortgage payments and flip it for 60c on the euro. Incredibly profitable.

hanaimai · 15-08-2018 1:56pm

If your interest rate is 1.5% I'm presuming that's a tracker. Just like a bank, a vulture fund cannot restructure a mortgage in such a way as you lose that tracker unless there is absolutely no sustainable restructuring arrangement available that would allow you to keep the tracker. It's extremely unlikely they'd be able to show that an arrangement where you lose your tracker is better than one where you keep it so don't worry about losing your tracker rate.

Bandana boy · 15-08-2018 2:25pm

€20k arrears on a 750 a month mortgage that your currently overpaying , did you go over two years not paying a penny ?

your chances of remortgaging and getting a deal are nil .
keep making your payments and you will be fine but expect any missed payments to have a fast response.

Cortexiphan · 15-08-2018 2:41pm

Bandana boy wrote: »

€20k arrears on a 750 a month mortgage that your currently overpaying , did you go over two years not paying a penny ?

your chances of remortgaging and getting a deal are nil .
keep making your payments and you will be fine but expect any missed payments to have a fast response.

I lost my job and was without work for a period, job was well paid back then. Struggled on half that salary for a while, and unemployed, then started to make payments of €200 a month, then back up to €800 as OH is now living with me and we split that mortgage.

Turnipman · 15-08-2018 2:56pm

Cortexiphan wrote: »

I was listening to that on the way home yesterday, and it was informative, but the arguement against Karl Dietrich(cant remember his name), was very weak, and spiralled towards homelessness instead.

Karl Deeter. Good lad, knows his stuff. He's the complete opposite of this self-serving windbag:- https://twitter.com/davidhall75

vandriver · 15-08-2018 3:04pm

Arthur Daley wrote: »

They are the definition of a bad credit risk. They are in arrears.

And the taxpayer foots the bill through the bank bailouts. I don't know who you think pays it.

Ulster Bank weren't bailed out by us.

Turnipman · 15-08-2018 3:10pm

vandriver wrote: »

Ulster Bank weren't bailed out by us.

Correct. Owned by RBS so the UK taxpayer had to bail them out!

Ulster Bank's main crime in Ireland was the way that they ripped so many of their tracker mortgage customers off.

Lux23 · 15-08-2018 3:13pm

Arthur Daley wrote: »

They are the definition of a bad credit risk. They are in arrears.

And the taxpayer foots the bill through the bank bailouts. I don't know who you think pays it.

Well, Ulster Bank is a British company and Cerberus is American, so I am pretty sure your taxes are safe in this man's case. Who is paying his mortgage every month and was in difficulty for a short time.

And if these people end up on the street, who do you think might be paying for their hotel room?

amcalester · 15-08-2018 3:16pm

Lux23 wrote: »

Well, Ulster Bank is a British company and Cerberus is American, so I am pretty sure your taxes are safe in this man's case. Who is paying his mortgage every month and was in difficulty for a short time.

And if these people end up on the street, who do you think might be paying for their hotel room?

He won't end up on the street as long as he doesn't decide to stop paying the mortgage.

Lux23 · 15-08-2018 3:22pm

amcalester wrote: »

He won't end up on the street as long as he doesn't decide to stop paying the mortgage.

Exactly!

Misguided1 · 15-08-2018 3:38pm

You'll probably find it a lot easier and productive to deal with Cerebus than with the bank.
Keep making your repayments and engage with them as soon as you can.

Don't panic - these guys don't want your home.

jimmycrackcorm · 15-08-2018 3:48pm

draiochtanois wrote:

This post has been deleted.

Have you a source for that?

draiochtanois wrote:

This post has been deleted.

You're suggesting they'd take a loss of 170k instead of a simple write down of 20k?

Water John · 15-08-2018 4:07pm

Jimmy the loans are bundled when sold at a price to the VF, the good, bad and plain ugly loans are lumped together and sold off at a discount. Lets say between 50 and 60 cent in the Euro.
The loan with the OP is one of the best in the bundle. There are others where the property has risen in value from when it was low, but the client may have paid SFA. The buying price was an average over the bundle.
It's not that the OP's loan was individually discounted to 50 or 60 cent.
So the OP can take comfort that he is one of the best in the VF bundle.

duffman13 · 15-08-2018 4:19pm

jimmycrackcorm wrote: »

Have you a source for that?

You're suggesting they'd take a loss of 170k instead of a simple write down of 20k?

They are two seperate points, first one someone else speculated that Cerberus spent 210k to purchase a 230k outstanding loan from the bank (on average)

The 2nd one he's saying it was more like 80k to buy the 230k loan.

I reckon it'll be around 120 or 130k for a 230k loan.

Nobody will be able to give you a source unless they work for Cerberus or Ulster Bank

Cortexiphan · 15-08-2018 4:23pm

I asked Ulster Bank yesterday, and they couldn't tell me how much the loan was bought for, as it is bundled with other loans.

Arthur Daley · 15-08-2018 4:36pm

Not singling you out, but you bought the property in 2007. people signed on the dotted line to purchase the property. A certain amount has been paid back in those 11 years. Chances are fairly high that the property is at least back up in value to it's 2007 price that you paid. Why would people think they are entitled to get a discount when a) they are adults who signed a legal contract and struck a price at a point in time b) the property is not in (or at least not significantly in) negative equity. There is a massive demand for properties, stick it on the market and it should fly, and debts are cleared. Rest easy.

You know this was how it worked before the last decade, and then people wonder why interest rates and rents are higher here than anywhere else in Europe. David Hall and others and the entire Political spectrum who cheerlead this, are directly to blame for this situation. This country is a shambles

I am one of the 5200 non-performing Ulster Bank mortgages.

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