Defaulting on a mortgage while abroad

Hi,

So this is my story - I bought an apartment for 381k with an ex-girlfriend in 2006. An apartment in the same complex is now on the market for 145k which is, needless to say, a bit disheartening. I moved to Canada a couple of years ago and have been sending money back to cover the payments - there are tenants in the apartment now paying 900euro a month - the mortgage is 1900euro a month. I have two main questions:
1. Can I have my ex sign over her half of the apartment to me so I own it outright?
2. What would the consequence then be of defaulting on the mortgage - considering I am based in Canada now with no intention of returning home within the next 5 years?

Thanks,
K

On the first part, I doubt it. I am in a similar boat and living/working in Ireland and they are unwilling to let me take over the mortgage despite my ex never paying towards it.

On the second part, could they repossess? Has your ex anything to do with the property?

1) Banks won't allow it it without you putting a lot of money towards the mortgage.
2) They will try and get you to pay and as long as you do they will do nothing.
Banks will do whatever is best for them in a given situation. If you stop paying, they will try and get a charge on a property you may have elsewhere. If you're out of the jurisdiction then this is more difficult. In the end they will repossess. My advice: stop paying, send them a letter stating that you cannot pay and are stopping BUT you're partner will now be chased down. Maybe a good idea to mention this (Seeing as you appear to be the only one paying its reasonable to land this on them)

Answer to Q1 is no! The Bank/B/Soc will not permit this.
Answer to Q2 is that the Bank will re-posess. As you are located in Canada, they will be unlikely to pursue you there. However they will be likely to take judgement proceedings against both of you for the residual debt. This will affect your credit record and if your co-borrower is located in Ireland could also result in problems for her.
If you are not intending to return to Ireland in the short/medium term there are unlikely to be any consequences against you. To date, I haven't seen Bank's seeking to take Court action in the US or Canada on foot of Irish judgements, unless they have evidence of significant assets being owned abroad!

Hi All,

I suspected that the bank would not allow her to sign over the property to me without a substansial payment - thanks for the confirmation.

I think I was unclear in my first post - I'm not on bad terms with my ex at all, and both of us are paying the mortgage seperately each month. So, any action that would harm her since she is still in Ireland isn't really an option. I was prepared to take the bad credit rating for x number of years since I'm not in Ireland any more but I doubt she will be willing to do it.

If it was mine alone, I would have stopped paying long ago! As you can see from the first post, there is no way the value is ever going back to what it was so this is just dead money - 350euro each a month after mortgage relief comes out - that we are paying.

Do any of you have any other suggestions?? I'd try anything to get out of this at this stage!!

Thanks for your advice.

Ask the bank can you go interest only for a year. The rent might cover the interest only mortgage repayments.
Have you talked to your ex about this? Is she happy to continue paying her half each month?
It is an awful situation many of us are in - one positive I can see in your case is that you are on good terms with your ex.

You've paid about 6 years of mortgage. How much do you currently owe? How many more years before your mortgage gets to 145K?

As you can see from the first post, there is no way the value is ever going back to what it was so this is just dead money - 350euro each a month after mortgage relief comes out - that we are paying.

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This is a great myth that people throw in all the time in order to back-up some justification for default. Let’s take your example with some rounded off figures:

You owe 350k.

You are paying 350 per month on top each = 4k p.a. In say 10 years’ time your total amount paid will be 40k. You’re capital on the home will have increased so you will owe say 200k. So if property prices rise by about 20% in ten years you come out even. If property prices rise you will make a gain. Similarly do the sums for 20 years. Total cost 80k, mortgage nearly paid off, if the property is worth 160k you come out even. Of course our great doomers will start to mention all that could go wrong and some may happen, but by the laws of averages this is not bad business practice. People are taking chances like this in business every day. That’s what you need to do with this. Treat it like a business and hope for the best.