# trying to get out from under Vulture



## endofourtether (11 Mar 2019)

*Income details
Net monthly *€3,500 - PAYE salary
*Net monthly *income partner/spouse: €4,000 PAYE Salary
Amount of child benefit received  €420
Amount of Mortgage Interest Supplement received Nil

*Personal circumstances so we can calculate your reasonable living expenses *

Two adult family
Do you need a car for work or do you use public transport? Yes 1 car
Number of children 0- 2 years old: 0
Number of 3 years old children: 0
Number of 4 - 11 years old: 1
Number of 12 - 18 years old: 2
Monthly childcare costs: €530

€5,168.58 - From the backontrack.ie calculator








*Home loan*
Lender: A Vulture Fund
Amount outstanding: €340
Value of home: €600-750k
Interest rate: specify whether tracker or SVR or fixed rate - SVR 4.95%
Monthly repayment €2,200
Amount in arrears €3k - This is a missed payment almost 2 years ago that we didn't realise was missed for a few months - We tended not to open the almost daily letters from the Asset manager.

We have been in discussions (not all meaningful) with the bank since day 1 - They were leaving the country and sent our BTL to receivership after only 5 missed payments - due to void and general nature of the economy at the time 2010. We missed some payments on the PPR but went through MARP and capitalised the arrears and interest, iirc about €35k.
Some History - I was working for myself with just a couple of regular gigs - these were state funded enterprises that lost their funding almost overnight and the trickle down meant that I was no longer affordable. My Income halved overnight, we had small children and big outlays - not a typical Celtic Tiger lifestyle however, modest enough, it just all added up.
My wife works for a state enterprise and the FEMPI and pension payment reduced her take home income by about 35%
BTL was on interest only and even then we had to fill a gap of about €500/month for about 5 years. It was our starter home and we leveraged it to the hilt.

*Investment property - *
Was sold by a receiver - c.€200k outstanding - They are now talking about a judgement mortgage.
This is my pain point - I literally begged for them not to do this, they ended selling through an Allsop auction for a lot less than would have been done had we sold it ourselves - And then the receivers fees etc.
*
Credit Union *
None


*Other loans and creditors - 
None*

*Other savings and investments *
Some shares - under €5k

*Do you expect any lump sums in the medium term future? *
No 
*

How important is retaining the family home to you? *
I really want to keep the Family home. At least until the kids have left school - another 9 years.

*Any other relevant information

What is your preferred realistic outcome? *
We just want to try to get back to normal. We want to get a mortgage with a proper bank but nobody wants us...because of the residual debt on the BTL.
We have been offered an number - I am loath to go into specifics because any asset manager worth their salt will be checking here - but even though it's a decent write off of the residual debt it appears that no banks want to be seen cleaning up the the fallout of the boom that they created. 
The number that has been offered would leave us with about 60% LTV.
So, we have good income, a good asset and a massive currently unsecured debt - They say they are going to apply for a judgement mortgage which would secure it.
I was so angry about the sale of the BTL and didn't engage with them constructively for a few years after that.
I want to see what strategy might be useful in order to pay them as little as we can for the outstanding debt. 
I don't want to hear opinions on the morality or otherwise of this - As far as I am concerned the VFs are the absolute bottom feeders our dealings with them have been exceptionally unpleasant. I want to find out how to give them as little as I can and to try to safeguard our future.
We have a broker who thinks that they will be able to get us money with no problems, the main reason that we believe this is that everybody else is completely negative.

The other option is to allow them to get a judgement mortgage and then to live forever...


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## Brendan Burgess (11 Mar 2019)

endofourtether said:


> We have been offered an number - I am loath to go into specifics because any asset manager worth their salt will be checking here - but even though it's a decent write off of the residual debt it appears that no banks want to be seen cleaning up the the fallout of the boom that they created.



Can you explain what this means. Who has offered you a number? What is a number? 



> The number that has been offered would leave us with about 60% LTV.



Is the lender on your family home the same as the lender on your BTL? 

You have a home worth €650k

You have two loans  €340k and €200k. 

So you are in positive equity overall. 

Why on earth don't you clear the arrears on your home?  That is an absolute priority.  If this ever goes to court, you want to be able to say "I cleared the arrears 5 years ago and have met every payment since".   As it is, the lender will be able to say "They have been in constant arrears for 10 years." 

Brendan


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## endofourtether (11 Mar 2019)

Brendan Burgess said:


> Can you explain what this means. Who has offered you a number? What is a number?
> 
> Is the lender on your family home the same as the lender on your BTL?
> 
> ...



The Vulture fund have offered us an amount to clear everything .
Both loans are with them. 
Regarding the arrears, we naively thought that due to the potential LTV that we could refinance easily. 
The lender seems to be quite happy with how this loan is performing.


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## Brendan Burgess (11 Mar 2019)

So you owe €540k 

The vulture fund has said that they will accept, say €440k in full and final settlement. 

Is that what you mean? 

It's probably a bit irrelevant unless you are prepared to sell your home to pay it off or unless you have a friend who will lend you the money. No bank will lend you the money with your credit record.

Brendan


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## endofourtether (12 Mar 2019)

Brendan Burgess said:


> So you owe €540k
> 
> The vulture fund has said that they will accept, say €440k in full and final settlement.
> 
> ...


And that's it?

We can't be the only ones in this predicament, we engaged from the beginning, have done our MARP, capitalised our arrears and missed one payment in the last 6/7 years and that's it?

Stuck to be paying 60% over the odds interest to a VF that doesn't want us.


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## Brendan Burgess (12 Mar 2019)

You made a risky investment in property. You handled it badly by your own admission.  So you are down €200k. 

But you have over €200k equity in your home. 

Brendan


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## NoRegretsCoyote (12 Mar 2019)

I am not really sure what you are asking here.

You have a net income of about €8k which puts you at or near the top decile nationally for households. A house of that value is comfortable for your needs unless you live in D4 or D6.

If they give you a settlement of 50% you would have total borrowings of (say) €440k with a term of maybe 20 years. This would put your monthly payments up to €2,900. This is heavy but not impossible on your income.

Once it's settled, is there any way that you can get a lower interest rate from the vulture?


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## endofourtether (12 Mar 2019)

Brendan Burgess said:


> You made a risky investment in property. You handled it badly by your own admission.  So you are down €200k.
> 
> But you have over €200k equity in your home.
> 
> Brendan


I'm not disputing that we handled it badly - it was a torrid time! Our income dropped by over 50% and we were trying to keep the wheels on, which we did, just about.
However if we were with an Irish bank we wouldn't be in this position. The equity in our home is eaten up by the loss and fees etc on the investment.
As you said Brendan, no bank wants to touch us - We can't be the only ones in this position.


NoRegretsCoyote said:


> I am not really sure what you are asking here.
> 
> You have a net income of about €8k which puts you at or near the top decile nationally for households. A house of that value is comfortable for your needs unless you live in D4 or D6.
> 
> ...


That's the problem, and that's what I'm looking for a steer on. Is there anybody in a similar position who has negotiated there way out of this?
The fund will only settle for the whole amount and banks won't loan based on the whole amount.


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## NoRegretsCoyote (12 Mar 2019)

endofourtether said:


> We just want to try to get back to normal. We want to get a mortgage with a proper bank but nobody wants us...because of the residual debt on the BTL.
> *We have been offered an number* - I am loath to go into specifics because any asset manager worth their salt will be checking here - *but even though it's a decent write off of the residual debt* it appears that no banks want to be seen cleaning up the the fallout of the boom that they created.
> The number that has been offered would leave us with about 60% LTV.
> S





endofourtether said:


> *The fund will only settle for the whole amount* and banks won't loan based on the whole amount.



This is very confusing.

Is the fund offering you a write-off or not?


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## endofourtether (12 Mar 2019)

NoRegretsCoyote said:


> This is very confusing.
> 
> Is the fund offering you a write-off or not?


Fund is offering a write off - Can't get refinance from any banks.
When I say whole amount, we tried to offer something on the residual (unsecured) because they are going to get a judgement against us but the fund only want the whole lot gone.


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## NoRegretsCoyote (12 Mar 2019)

@endofourtether By the looks of it the write-off being offered leaves you in a financially sustainable position. 

We'd all love less debt, and you'll still have had the benefit of a big chunk of yours written off.

Long-run, you want to get to a position where you can re-finance with someone else. I am not the best to give advice on this, but I would presume that a track record of several years of payment of the consolidated debt would leave you in a much better position to seek re-financing.


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## RETIRED2017 (12 Mar 2019)

Sell house take your equity and start again that is what happens in other Countries,possibly what the Fund/Banks are more used of outside of Ireland,


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## Bronte (12 Mar 2019)

endofourtether said:


> Amount in arrears €3k - This is a missed payment almost 2 years ago that we didn't realise was missed for a few months - We tended not to open the almost daily letters from the Asset manager.
> 
> We have been in discussions (not all meaningful) with the bank since day 1 - They were leaving the country and sent our BTL to receivership after only 5 missed payments - due to void and general nature of the economy at the time 2010. We missed some payments on the PPR but went through MARP and capitalised the arrears and interest, iirc about €35k.
> 
> ...



It's not clear what is going on here but I'd take issue with some of your points. Looks like you had a starter home, presumably you were some years into a mortgage and you then borrowed massively against the 'equity' in it to purchase your current home. So some of the money from your BTL went into your PPR.  Presumably part of the deposit or more.  Particularly as your equity is quite good in it.  So the two properties were always linked. If you didn't have the BTL's equity I'm guessing you would not have been able to purchase your forever home.

So one could reasonably suggest that some of that 200K is actually now part of your equity.

It also seems that you borrowed so much on the BTL it didn't cover the mortgage, despite it being interest only.

I'm not critising you but I'm showing you how bankers and others may view it.

You were unfortunate perhaps that the Vulture appointed the receiver so quickly.  Maybe they were pissed off they were not being paid on two properties, particulalry if rent was coming in and you were using that, I'm not say you were but if I were a bank that's the thing to do.

Alsopps you were very unlucky.

Is your house worth 600K or 750K, there's a vast difference.

This is where I'm lost.

Are the bank saying give us X now in cash and we'll write off some of the 200K.

Or are they saying consent to the judgment mortgage and we wil write off some of the 200K leaving you with 65%.

600K X 60% = 360
or 750 X 60% = 450

200K + 340 = 540. Means a write down of 90K, 540 - 450 unless I've misunderstood you.


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## Bronte (12 Mar 2019)

RETIRED2017 said:


> Sell house take your equity and start again that is what happens in other Countries,possibly what the Fund/Banks are more used of outside of Ireland,


750 - 200 - 340 = 210, less say 10K costs.  = 200
Or
600 - 200 - 340 - 10 = 50

He can't do that as he won't be able to purchase another property due to his credit rating.

Now can he take 200K or 50 K, (might be more if the bank is writing down some of the BTL debt). And on an income of 8K a month he can rent easily.

And he's out from the Vulture who he can't wait to get rid of.


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## endofourtether (12 Mar 2019)

NoRegretsCoyote said:


> @endofourtether By the looks of it the write-off being offered leaves you in a financially sustainable position.
> 
> We'd all love less debt, and you'll still have had the benefit of a big chunk of yours written off.
> 
> Long-run, you want to get to a position where you can re-finance with someone else. I am not the best to give advice on this, but I would presume that a track record of several years of payment of the consolidated debt would leave you in a much better position to seek re-financing.



The write off obviously leaves us in a better position but the banks won't loan us the money to both remortgage and pay down the residual debt. We are being told that it is just bank policy.

So when the fund wrote to us telling us they were about to get a judgement on the residual debt we thought that we only had to find the money for that element of the debt. We believed that this would then put us into a normal position and just have a mortgage with the fund which would be a lot easier to refinance.

We then found that they wanted us to clear all of the debt and can't get finance for that.

How can we get them to do this in a two step process?


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## NoRegretsCoyote (12 Mar 2019)

Bronte said:


> Now can he take 200K or 50 K, (might be more if the bank is writing down some of the BTL debt). And on an income of 8K a month he can rent easily.
> 
> And he's out from the Vulture who he can't wait to get rid of.



OP seems to want to keep his house, avail of a write-off, and have a lower interest rate too!


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## NoRegretsCoyote (12 Mar 2019)

endofourtether said:


> We then found that they wanted us to clear all of the debt and can't get finance for that.
> 
> How can we get them to do this in a two step process?



I'm still confused.

They are presumably giving you a write-off on some portion of the €200k. 

Are you saying that:

they will consolidate the remainder as part of your existing mortgage with them?
they are forcing you to re-finance the remainder with another provider?


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## Brendan Burgess (12 Mar 2019)

You currently owe them €540k on a property worth between €600k and €750k 

In any other country, they would just repossess the property redeem the loan and give you whatever is left over.

You are very lucky in that this rarely happens in Ireland. 

How much have they agreed to take in full and final settlement of the €540k?  Do you have that in writing or was it verbal? 

(Don't worry about the vulture fund reading this. I doubt they are, but so what?) 

Brendan


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## endofourtether (12 Mar 2019)

NoRegretsCoyote said:


> OP seems to want to keep his house, avail of a write-off, and have a lower interest rate too!


Yes. I want to extract myself from this position to ensure that I am left in the best position financially.
I thought that this forum was where I would get advice. I don't need to be judged, I have done that myself for the last 10 years.


NoRegretsCoyote said:


> I'm still confused.
> 
> They are presumably giving you a write-off on some portion of the €200k.
> 
> ...


They are offering an amount to fully buy out our total debt with them - This includes PPR and residual debt.
We can't get finance for that debt even though as a percentage of the value of our family home it would be just 60% and our current incomes can support it.
They are not forcing us to refinance with another provider another provider would have far cheaper rates.


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## NoRegretsCoyote (12 Mar 2019)

endofourtether said:


> They are offering an amount to fully buy out our total debt with them - This includes PPR and residual debt.
> We can't get finance for that debt even though as a percentage of the value of our family home it would be just 60% and our current incomes can support it.
> They are not forcing us to refinance with another provider another provider would have far cheaper rates.



My advice would be to take the offer, get a few years of full repayment under your belt, then seek to re-finance with another provider. It's just a switch at that point.

Anyway, I'm off now to pay some of the highest mortgage rates in Europe!


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## RedOnion (12 Mar 2019)

endofourtether said:


> I thought that this forum was where I would get advice.


Unfortunately more reality than the kind of 'advice' you're looking for.



endofourtether said:


> We have a broker who thinks that they will be able to get us money with no problems


Why have you given up on the broker?


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## endofourtether (12 Mar 2019)

RedOnion said:


> Unfortunately more reality than the kind of 'advice' you're looking for.
> 
> 
> Why have you given up on the broker?


Haven't given up but we've been down this path a few times before so I'm seeing what other options might be.


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## Brendan Burgess (12 Mar 2019)

Brendan Burgess said:


> You currently owe them €540k on a property worth between €600k and €750k





endofourtether said:


> We can't get finance for that debt even though as a percentage of the value of our family home it would be just 60%



So if your house is worth €700k, they are offering to settle the total debt for €420k.

That is a write off of €120k - not bad. 

You have an income of €90,000 so you need 4.6 times your income. 

I don't think you have a hope in hell of getting this. 

So
1) Clear the arrears on your home loan immediately for the reasons I have already set out. 
2) Let them lodge the judgement against your home - there isn't much you can do about it.

If I recall correctly, the interest on the judgement mortgage will be at a very low rate, so you don't really need to worry about it.  

In theory they could seek an order for repossession, but it's very unlikely.

Brendan


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## Brendan Burgess (12 Mar 2019)

Have you a family member who could lend you €100k?  

I suspect that the fund would take the €100k in settlement of the €200k unsecured loan. 

That would leave you with a mortgage of €340k.  

After a few years, your credit record will repair, and you should be able to switch to another lender. 

Brendan


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## Bronte (12 Mar 2019)

endofourtether said:


> Yes. I want to extract myself from this position to ensure that I am left in the best position financially.
> I thought that this forum was where I would get advice. I don't need to be judged, I have done that myself for the last 10 years.
> 
> They are offering an amount to fully buy out our total debt with them - This includes PPR and residual debt.
> ...




Ok let's try this a different way. What 'deal' would you be happy with? Compared to what is currently on offer?

And I still don't understand what is actually physically being offered other than apparently when you sign the deal you will owe 60% of the value of your home, a value that we are not even given as you've stated 600K to 750K. 

Lastly, you have a gripe that the problem with this deal as that despite a good LTV you won't be able to switch lenders.  I think. 

If you think you'd get a better deal, which I doubt, try poster Jim Stafford, he's excellent in this area but he'll cost you.


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## endofourtether (12 Mar 2019)

Bronte said:


> Ok let's try this a different way. What 'deal' would you be happy with? Compared to what is currently on offer?
> 
> And I still don't understand what is actually physically being offered other than apparently when you sign the deal you will owe 60% of the value of your home, a value that we are not even given as you've stated 600K to 750K.
> 
> ...


I would like to be able to deal with both the residual loan and the Family home loan separately, I feel that I am being forced to do them together.
What is being offered is a substantial write down if we do all of the loans in one refinance. we can't get this financed.
I am wondering if there is any approach that we should try to take in order to get the VF do it in a piecemeal manner.


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## RedOnion (12 Mar 2019)

Bronte said:


> And I still don't understand what is actually physically being offered other than apparently when you sign the deal you will owe 60% of the value of your home, a value that we are not even given as you've stated 600K to 750K.


I think what the OP is saying is the fund will do a debt write off, but only if the balance is repaid (i.e. he needs to be able to refinance to get the deal).
Or at least that's what I think. There's too much to read through.


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## endofourtether (12 Mar 2019)

RedOnion said:


> I think what the OP is saying is the fund will do a debt write off, but only if the balance is repaid (i.e. he needs to be able to refinance to get the deal).
> Or at least that's what I think. There's too much to read through.


Nail on the head - apologies, I don't want to give too much detail.
Is there a strategy that will get them to deal with these two separate loans, one secured one not, as two separate loans?


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## Bronte (12 Mar 2019)

endofourtether said:


> I would like to be able to deal with both the residual loan and the Family home loan separately, I feel that I am being forced to do them together.
> What is being offered is a substantial write down if we do all of the loans in one refinance. we can't get this financed.
> I am wondering if there is any approach that we should try to take in order to get the VF do it in a piecemeal manner.




I will try again.

a) The VF will write down around 100K of debt if you agree to a refinance, in simple language a new mortgage with them that is the BTL debt minus write down plus current mortgage. 

Is that correct?

b) And if you don't do that is this correct:

The VF will put a judgement mortgage of the entire BTL loan on your home.


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## Bronte (12 Mar 2019)

RedOnion said:


> I think what the OP is saying is the fund will do a debt write off, but only if the balance is repaid (i.e. he needs to be able to refinance to get the deal).
> Or at least that's what I think. There's too much to read through.



How can he refinance from anywhere else when he's credit rating is shot? I think he means refinance with the VF.


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## RedOnion (12 Mar 2019)

Bronte said:


> How can he refinance from anywhere else when he's credit rating is shot? I think he means refinance with the VF.


Sure he'd be mad not to if that was on offer.



endofourtether said:


> apologies, I don't want to give too much detail.


You have to give enough info, in a clearl manner, if you want help. I've got confused reading your posts.



endofourtether said:


> I am wondering if there is any approach that we should try to take in order to get the VF do it in a piecemeal manner.


At the moment VF hold all the cards (or at least your title deeds). Why would they give that up and hand you deeds without a charge, so they could at best hope for a judgement mortgage on the unsecured debt?


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## noproblem (12 Mar 2019)

Unless you can get the money from someone you're simply banjaxed. In the same position would you gamble on someone similar? I wouldn't. Sorry but it's business.


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## endofourtether (12 Mar 2019)

Bronte said:


> I will try again.
> 
> a) The VF will write down around 100K of debt if you agree to a refinance, in simple language a new mortgage with them that is the BTL debt minus write down plus current mortgage.
> 
> ...


A) Correct.
B) Correct




Brendan Burgess said:


> Have you a family member who could lend you €100k?
> 
> I suspect that the fund would take the €100k in settlement of the €200k unsecured loan.
> 
> ...


No.
It would leave us with €100k owing to a family member and a €340k mortgage.



Bronte said:


> How can he refinance from anywhere else when he's credit rating is shot? I think he means refinance with the VF.


We want to be shot of the VF. Rate is 5%.


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## NoRegretsCoyote (12 Mar 2019)

You want:

A debt-write off
To stay in your PPR
A lower interest rate

You can have any two of these, but not all three.


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## Bronte (12 Mar 2019)

endofourtether said:


> A) Correct.
> B) Correct
> 
> 
> ...



Seems to me you will get a debt write down right now of 100K and you should grab it.
Do the refinance with the VF and get your credit rating sorted and you move to a different bank. 
I do not believe a broker can get you a mortgage with your bad credit rating

*Alternatively*

Take a family loan, and the mortgage.  And with such a magnificant LTV now as you've only 340K owing on 700K try and move banks.   (Obviously you don't tell them you owe another 100K!).  You then hopefully get a good interest rate, freeing up more  money to pay down the family debt and the mortgage.   

That's what I would do.


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## Brendan Burgess (12 Mar 2019)

I know you don't want to tell us the full story, but this is getting ridiculous.

You are saying that Bronte is correct, although I am fairly sure that she has misunderstood you.



Bronte said:


> a) The VF will write down around 100K of debt if you agree to a refinance, in simple language a new mortgage with them that is the BTL debt minus write down plus current mortgage.



You said "correct". 

Let's make this absolutely clear. 

The Vulture Fund is saying 
"If you refinance with us, we will write off €100k" 

Sorry, but this makes no sense. 

Presumably the Vulture Fund is saying: 

"If you pay us €420k now by refinancing with another lender, we will write off the shortfall" 

Or are they actually offering you the "Bronte Deal". Accept €100k of this on your home, and will write off €100k.  If so, then grab it. 

Brendan


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## Bronte (12 Mar 2019)

Brendan Burgess said:


> Let's make this absolutely clear.



Good luck with that.

(By the way, if I were a bank dealing with him I'd be tearing my hair out trying to get rid of him.  So far none of us has actually figured out what is going on)


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## endofourtether (12 Mar 2019)

NoRegretsCoyote said:


> You want:
> 
> A debt-write off
> To stay in your PPR
> ...


It seems that we can't even get 2. We are staying in our PPR though.


Bronte said:


> Seems to me you will get a debt write down right now of 100K and you should grab it.
> Do the refinance with the VF and get your credit rating sorted and you move to a different bank.
> I do not believe a broker can get you a mortgage with your bad credit rating
> 
> ...


Are you saying that the VF might roll everything together as one loan and write off the residual debt owing on the BTL?
That would be most helpful.

I must say that I love our wealthy and generous families...


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## Bronte (12 Mar 2019)

endofourtether said:


> Are you saying that the VF might roll everything together as one loan and write off the residual debt owing on the BTL?
> That would be most helpful.



What would be helpful is if we could understand your posts. At least now we know the 'Bronte deal' is off the table. _It's a bit like Brexit this thread._ 

When did a broker tell you they could get a refinance deal with another bank?  Which bank and at what rate of interest?

We have also finally clarified with your sarcasim that you do not have a family member able to loan you anything.


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## endofourtether (12 Mar 2019)

Brendan Burgess said:


> I know you don't want to tell us the full story, but this is getting ridiculous.
> 
> You are saying that Bronte is correct, although I am fairly sure that she has misunderstood you.
> 
> ...


Apologies. If we refinance through a third party they will do a write off.

Look, I have been clear, all of my information is there, I just read through my posts, this is ongoing so I am trying to be a little opaque.


Bronte said:


> Good luck with that.
> 
> (By the way, if I were a bank dealing with him I'd be tearing my hair out trying to get rid of him.  So far none of us has actually figured out what is going on)



Is this meant to be funny, I'm obviously able to give the bank the full details.


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