# Why is the EBS not chasing the mortgage shortfall?



## J Hayes (10 May 2017)

My family and I currently live abroad with no intention to return to Ireland in the near future. In long term mortgage arrears with the Bank (EBS) since 2013 and was renting out the property while working on a resolution. PIA rejected in 2015 with voluntary surrender as the only remaining option. Keys were returned and tenant removed at the Banks instruction.

Almost 2 years later, the property is still vacant and the Bank have made no attempt to actively engage with me or sell the property. In recent months, they have ceased communications altogether. Since the process started, my wife and I have started a family (one child with two on the way!) and are surviving on a single income.

Any guidance on whether a resolution is achievable at this point and how I could go about it?

I also wonder what EBS are waiting for and whether they are in a holding pattern with this plan to offload impaired loans in the near future?


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## cremeegg (10 May 2017)

I am not a lawyer.

Wait six years from the last time you acknowledged the debt and I reckon the house is yours, debt free.


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## aristotle (10 May 2017)

https://www.askaboutmoney.com/threa...he-bank-does-nothing-or-cant-fit-find.177438/


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## RedRed (10 May 2017)

Wasn't the original poster asking about how to get EBS to come to the table and find a solution, particularly with AIB's stated objective of getting rid of NPL's?  I think referring to statute of limitations is missing the point. EBS has obviously gone radio silent.


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## TLO (11 May 2017)

This could go on for years.  Chances that EBS doesn't know what to do with the returned property. Or maybe it is caught up in the Central Bank's tracker redress review?  Or maybe, because the property was originally a family home, EBS might have to get a court order to allow for it's sale?  Hard to know.

Suggest forgetting about it.


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## J Hayes (13 Nov 2017)

[UPDATE]

Recently received notification that the property in question has finally been sold!

Would be very interested to hear peoples thoughts on what will happen next, given that I have no assets of note and 2 more dependents since they were last in contact? 

Does the Bank typically look to start negotiations on the residual unsecured debt (~€100k) or do they immediately go the insolvency/bankruptcy route (noting I don’t live in Ireland and cannot be served)? 

I had made a lump sum settlement offer in the past as part of a PIA submission, which was rejected out of hand. Interested to see if they will revisit this. 

Appreciate all the advice so far!

J.H


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## Brendan Burgess (13 Nov 2017)

They are very unlikely to do anything.. they wont spend money chasing you abroad as they have little chance of success. They might sell it to a fund who might hassle you.  

Or if you return,  they might seek an order against you.. 

Brendan


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## TigerDebt (18 Nov 2017)

Hello J Hayes,

I am in a similar position but still in the country. My mortgage was/is with EBS. Voluntarily sold home in 2014 at a huge loss. The residual debt is just sitting there as I cannot afford to repay and I do not qualify for PIA. EBS would not do a deal or come to a settlement. For the first two years I tried to come an arrangement but they didn't want to know. For the last 15 months its just radio silence. For the life of me I cannot understand their strategy. 

The only option I have now is to wait 6 years and apply the statute of limitations. I'm in limbo but at least I have my sanity!


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## J Hayes (20 Nov 2017)

Appreciate the quick response Brendan - no sure whether I should have expected more pragmatism from a re-capitalized lender, but I imagine the ‘do nothing’ approach will change closer to debt expiry in 2023. Have you seen any evidence of Banks actively engaging on unsecured debt post-sale of property?

TigerDebt, 

I think the mistake we made was assuming the Bank has a long term plan at all (unless you count head in the sand as a viable strategy.) Happy to compare notes if you want to PM me. 

Thanks,
Darren


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## Brendan Burgess (21 Nov 2017)

TigerDebt said:


> The residual debt is just sitting there as I cannot afford to repay and I do not qualify for PIA.



If you are insolvent, why don't you go bankrupt?


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## Bronte (21 Nov 2017)

For those waiting for the statute of limitations watch out.  This happened in the crash in England in the eighties I think it was.  But the clever banks came after people who got back on their feet at year 5 and 11 months (or whatever it was at the time). 

People abroad will be unlikely to be chased by banks, especially if they are anywhere further than the UK.


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## J Hayes (28 Nov 2017)

Thanks Bronte.

Understanding the Statute of Limitations is set at 6 years to allow lenders to find alternate solutions to insolvency/bankruptcy (and presuming the proposed 2017 amendment to reduce this to 2 years was being debated on these same grounds), I would fully expect a creditor to engage with a debtor or sell on the residual debt long before the 6 year expiry.

Has anyone seen evidence of Banks actively engaging on unsecured residual debt post-sale of property? 

J.H


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## IdesofMarch (2 Dec 2017)

EBS usually do not chase residual debt owed to them by the borrower. This is because they have entered into a mortgage indemnity bond (usually referenced in opening paragraph of the loan offer), so they get paid for any residual debt outstanding (subject to the T & C of the bond) by the bond.


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## RedRed (2 Dec 2017)

Wow that’s pretty interesting. Can you provide a bit more colour on that? Any other banks in same situation or just EBS? Never heard of that before.


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## IdesofMarch (2 Dec 2017)

Just EBS overtly, you would have to do your own research to discover the level of credit default insurance that other lenders signed up for.


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## J Hayes (4 Dec 2017)

I checked my original loan documents and a mortgage indemnity bond WAS taken out and added to the total loan amount. While EBS’ future strategy remains as unclear as ever, this at least explains why they have shown no appetite to do a deal. 

I also received a letter from EBS stating they will be submitting monthly details of the residual debt to ICB going forward - standard practice I imagine! 

J.H


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## IdesofMarch (9 Dec 2017)

New Central Credit Register requirement I'm afraid


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## J Hayes (12 Jan 2018)

IdesofMarch said:


> EBS usually do not chase residual debt owed to them by the borrower. This is because they have entered into a mortgage indemnity bond (usually referenced in opening paragraph of the loan offer), so they get paid for any residual debt outstanding (subject to the T & C of the bond) by the bond.



I received a Realisation Schedule from the Bank recently confirming Voluntary Sale proceeds (less costs) and outlining the account balance outstanding - I assume this is a standard letter for banks dealing with mortgage shortfalls. If EBS are unlikely to pursue overseas borrowers, are occasional balance statements in the mail the sum of their efforts to find a resolution? 

I read in the Irish Times recently that AIB/EBS are twice as likely to seek a debt summary judgement in the courts than other Banks...

J.H


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## Theory (29 Apr 2018)

I'm wondering what is the statue of limitations that you refer to?


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## lff12 (27 Sep 2018)

TLO said:


> This could go on for years.  Chances that EBS doesn't know what to do with the returned property. Or maybe it is caught up in the Central Bank's tracker redress review?  Or maybe, because the property was originally a family home, EBS might have to get a court order to allow for it's sale?  Hard to know.
> 
> Suggest forgetting about it.



I think you nail it here - court orders can take up to 2 years so its possible action might be in the pipeline, but hasn't got to poster yet, or if they are abroad, they are not at an address or phone number the lender expected. Might be worth talking to a solicitor to try to negotiate something again.


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## Catty2014 (8 Nov 2018)

Similar situation guys, house bought back in 2008, at only 19; young and silly.  Mortgage defaulted in 2011 and in 2015 house was repossessed by EBS and sold. There was residual debt of over 200k and when I requested my credit report recently, it showed that payments were made for 9 months in 2016. I did not make any payment so wonder if EBS could be ‘faking’ payments in order to not let the 6 year statue of limitations kick in? Also, they are adding around €750 monthly to the balance owed. Can they do that? Thanks


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## RedOnion (8 Nov 2018)

Catty2014 said:


> it showed that payments were made for 9 months in 2016.


How can you see that from credit report? You would need a statement to see repayment?



Catty2014 said:


> Also, they are adding around €750 monthly to the balance owed. Can they do that?


Yes. That equates to approx 4.5% interest.


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## Catty2014 (8 Nov 2018)

The credit report shows number of months in arrears and for 9 months the arrears reduce to zero and then start to build again ie 1 month in arrears, 2 months in arrears etc. I suppose I am assuming that payments were made the months the arrears reduce back to zero..?


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## RedOnion (8 Nov 2018)

Not necessarily. They might have capitalised the arrears, or recalculated a repayment or something. It'd be very strange for them to repay your mortgage for you!


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## Catty2014 (8 Nov 2018)

I thought maybe they might be making it look as if payments were made, in order to push out the statue barring.. Very dark I know! But cannot understand why else the debt is still on my icb report given that it’s been 8 years since last payment and 6 years from last contact


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## J Hayes (4 Jan 2020)

I recently spoke with MABS about our case. They informed me that while debt becomes statute barred after 6 years (and therefore not legally enforceable) it will stay on your credit history until paid or settled. That means unpaid debt in ireland follows you FOREVER and the banks have no incentive to proactively find a resolution. I am planning to talk to a PIP about potentially making an approach to EBS this year, but would be interested to hear if anyone has had success negotiating settlement with EBS on unsecured, residual debt?


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## NoRegretsCoyote (5 Jan 2020)

J Hayes said:


> I recently spoke with MABS about our case. They informed me that while debt becomes statute barred after 6 years (and therefore not legally enforceable) it will stay on your credit history until paid or settled. That means unpaid debt in ireland follows you FOREVER



Are you sure? The Central Credit Register website says that information is only held for five years after transmission by the bank. Would EBS still be making new submissions on your loan anymore?




> Credit information will be held on the Central Credit Register for a period of five years from the date a loan is paid off.
> Credit performance information, such as outstanding balance and number of payments past due will be held on the Central Credit Register for a period of five years from when it was first submitted.


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## J Hayes (5 Jan 2020)

'from the date a loan is paid off', meaning if the loan is not paid or a settlement arrangement reached, creditors will report to CCR indefinitely on a monthly basis, impairing your credit history. Even if the CCR only looks back 5 years, your profile will continue to be updated with negative credit info until the bank stop reporting the loan (something they have no incentive to do). In effect, there is no chance of a fresh start without negotiating with the Banks, and by doing so you always reset the clock on statue of limitations. 

Happy to hear from anyone who has been informed to the contrary of course!

J.H


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