Hi,
So this is the net result of this old thread:
And if you'll indulge me, I'll pick up the story again, because I have a new question based on subsequent events.
I wrote the original post in 2013. My father in law died at the end of 2014 and my mother in law died in May of this year. I am in a position to correct some of what was written above with actual figures, as I have now been through the original paperwork. Again, the fact that my late father-in-law made some pretty terrible decisions here is not in dispute! Nor is the fact that there's a debt to be paid.
What happened / what happened next:
1. My Brother-In-Law (BIL) was denied a mortgage for a house in 2005 in West Cork. He approached my father-in-law (FIL) for help.
2. Two new mortgages were taken out December 2005 by my FIL to buy the house the son wanted: €280,000 for the 'son's house', €100,000 against the 'father's house'. €355K was spent purchasing the 'son's house' and €25K was spent closing all FIL's existing borrowings.
3. Both mortgages were 15 years, interest only to the end of 2008.
4. BIL's agreement with his father was that he was to pay both mortgage repayments as rent, while having three years to build savings and arrange a mortgage for the balance. He received rent tax relief.
5. FIL covered mortgage protection on the €100K, and paid the home insurance and LPT on the 'son's house'. There was no mortgage protection on the €280K.
7. It became obvious by 2008 that the son was not going to get a mortgage - the crash, and his wife losing her job. The interest-only was extended and extended again to the end of 2012. By the end of 2012 there were eight years left on the two mortgages and the principals kicked in. Total repayment was >€4,000 per month.
8. BIL couldn't hope to pay it (he had messed around with the existing arrangement as it was, so that the accounts were often in temporary arrears). The mortgages quickly went into arrears, hence my original post about negotiating a restructure...
9. FIL died November 2014. The MP kicked in on the €100K loan and that was cleared and closed. This should have been enough to help the BIL, but whatever went on at his end, he still couldn't buy the house.
10. At some point, I can't work out exactly when, my BIL stopped making 'rent' payments altogether. Relationships almost totally broke down.
11. My mother-in-law (MIL) wanted no part of any of it. She told her son, my BIL, that when a receiver was appointed she'd cooperated fully to get the debt off her back. A receiver was eventually appointed in Summer 2017 (Deloitte) and my mother-in-law (MIL) did whatever she had to do to facilitate that. The debt on the 'son's house' was just under €280K at this point. We then heard nothing more...
The question
My mother-in-law died in May of this year. She left her home to my wife and her sister, plus about €50,000 cash - before legal fees, funeral expenses etc. It's all currently in probate.
The solicitor dealing with the will has discovered that Deloitte have never made any move to sell the house in the last three years, and that no rent has ever been collected from my BIL. Apparently, they attempted to evict my BIL in 2018, but he successfully fought it at the RTB on the grounds that 'the landlord' (his mother) had not given adequate notice. He is still in the house today. Meanwhile, the original Ulster Bank mortgage is now owned by Promontoria. They have continued to apply interest and charges to the original debt, so that it is now ~320K according to the last statement I saw.
So, after all that: Can a receiver just sit on an investment property like that for three years, not sell it, not collect any rent, while the lender continues to pile interest onto the debt? Can they keep doing that as long as they want?
So this is the net result of this old thread:
In-laws in a mortgage mess
This is a bit of a long story and if the like is covered elsewhere I apologise - I did a search... My in-laws have got themselves into a terrible mess with a mortgage... I'm putting in all the facts as best I have them. Any advice on what my in-laws can do would be appreciated: In 2006 my...
askaboutmoney.com
And if you'll indulge me, I'll pick up the story again, because I have a new question based on subsequent events.
I wrote the original post in 2013. My father in law died at the end of 2014 and my mother in law died in May of this year. I am in a position to correct some of what was written above with actual figures, as I have now been through the original paperwork. Again, the fact that my late father-in-law made some pretty terrible decisions here is not in dispute! Nor is the fact that there's a debt to be paid.
What happened / what happened next:
1. My Brother-In-Law (BIL) was denied a mortgage for a house in 2005 in West Cork. He approached my father-in-law (FIL) for help.
2. Two new mortgages were taken out December 2005 by my FIL to buy the house the son wanted: €280,000 for the 'son's house', €100,000 against the 'father's house'. €355K was spent purchasing the 'son's house' and €25K was spent closing all FIL's existing borrowings.
3. Both mortgages were 15 years, interest only to the end of 2008.
4. BIL's agreement with his father was that he was to pay both mortgage repayments as rent, while having three years to build savings and arrange a mortgage for the balance. He received rent tax relief.
5. FIL covered mortgage protection on the €100K, and paid the home insurance and LPT on the 'son's house'. There was no mortgage protection on the €280K.
7. It became obvious by 2008 that the son was not going to get a mortgage - the crash, and his wife losing her job. The interest-only was extended and extended again to the end of 2012. By the end of 2012 there were eight years left on the two mortgages and the principals kicked in. Total repayment was >€4,000 per month.
8. BIL couldn't hope to pay it (he had messed around with the existing arrangement as it was, so that the accounts were often in temporary arrears). The mortgages quickly went into arrears, hence my original post about negotiating a restructure...
9. FIL died November 2014. The MP kicked in on the €100K loan and that was cleared and closed. This should have been enough to help the BIL, but whatever went on at his end, he still couldn't buy the house.
10. At some point, I can't work out exactly when, my BIL stopped making 'rent' payments altogether. Relationships almost totally broke down.
11. My mother-in-law (MIL) wanted no part of any of it. She told her son, my BIL, that when a receiver was appointed she'd cooperated fully to get the debt off her back. A receiver was eventually appointed in Summer 2017 (Deloitte) and my mother-in-law (MIL) did whatever she had to do to facilitate that. The debt on the 'son's house' was just under €280K at this point. We then heard nothing more...
The question
My mother-in-law died in May of this year. She left her home to my wife and her sister, plus about €50,000 cash - before legal fees, funeral expenses etc. It's all currently in probate.
The solicitor dealing with the will has discovered that Deloitte have never made any move to sell the house in the last three years, and that no rent has ever been collected from my BIL. Apparently, they attempted to evict my BIL in 2018, but he successfully fought it at the RTB on the grounds that 'the landlord' (his mother) had not given adequate notice. He is still in the house today. Meanwhile, the original Ulster Bank mortgage is now owned by Promontoria. They have continued to apply interest and charges to the original debt, so that it is now ~320K according to the last statement I saw.
So, after all that: Can a receiver just sit on an investment property like that for three years, not sell it, not collect any rent, while the lender continues to pile interest onto the debt? Can they keep doing that as long as they want?
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