Hi my parents took out an endownment mortgage years ago with irish life.Due to them splitting up over 18yrs ago one parent struggled to pay repayments in full while the other walked away.mortgage term is finished in august and will still have a balance of nearly 50k which they have no way of clearing.my mother is 63 so wont get an extension. Was thinking of putting house on market but might not be sold in time. My question is can the bank still reposses if they house is up for sale ? Or has she any other options ?
Endowment mortgage shortfall of €25k - but no means of paying it.
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Brendan Burgess
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It takes a bank years to repossess a house.
Just let them know that it's up for sale if that is what she wants to do.
BRendan
Just let them know that it's up for sale if that is what she wants to do.
BRendan
What happened to the endowment policy, was it cashed in at the time your parents split or was it simply left lapse? Have she heard from the insurance company?
Hi just a quick question on this so her shortfall is 25k. Bank are still taking mortgage payments even though term ended end of aug. Just wondering is there anywhere she could go to get help with shortfall. Unfortunately at the minute I am not in a position to get 25k. But would mabs be able to help her. Just clutching at straws here.
She could try MABS, they may be able to negotiate with the bank on her behalf but won't actually be able to get her money anywhere and depends whether or not negotiating to say reduce the payment by lengthening the term is to her benefit or not but she may as well try them to see what their suggestion is.
Brendan Burgess
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There will be no pressure at all from the bank.
She should talk to them and they will probably be happy to take the mortgage payments for the foreseeable future.
Brendan
She should talk to them and they will probably be happy to take the mortgage payments for the foreseeable future.
Brendan
Brendan Burgess
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Which lender?
What is the interest rate?
How much is she paying each month?
How much can she afford to pay?
Brendan
Brendan Burgess
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OK, she is probably paying 4.25% SVR
that means that she is paying about €1,000 interest a year.
If she is paying €3,600 a year in repayments, she is knocking €2,600 a year off the balance remaining.
At this rate, she will clear the mortgage in about 8 years.
KBC is well aware of this and, while they might write a letter or two, or even make a phone call, they certainly won't initiate legal action.
Your mother has absolutely nothing to worry about. If she wants to stay in the house, she should do so. If she wants to trade down, she can do so at her leisure.
Generally speaking, trading down is not a very good idea, as the costs of selling, buying, moving and decoration often use up most of the savings.
Brendan
that means that she is paying about €1,000 interest a year.
If she is paying €3,600 a year in repayments, she is knocking €2,600 a year off the balance remaining.
At this rate, she will clear the mortgage in about 8 years.
KBC is well aware of this and, while they might write a letter or two, or even make a phone call, they certainly won't initiate legal action.
Your mother has absolutely nothing to worry about. If she wants to stay in the house, she should do so. If she wants to trade down, she can do so at her leisure.
Generally speaking, trading down is not a very good idea, as the costs of selling, buying, moving and decoration often use up most of the savings.
Brendan
Brendan Burgess
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KBC, like most other Irish lenders, exploit the laziness and ignorance of their customers. Your mother is probably paying 4.25% as it's an old mortgage.
She can fix the mortgage rate for 3 years and reduce the rate to 2.45%. At this rate, she would pay off the mortgage quicker - probably in about 7 years.
KBC might refuse to give her this rate as the mortgage has passed its maturity date. So the first thing you should do is to get their agreement to an extension of the term by 8 years. When that is agreed , then apply for the lower rate and they would not be able to refuse it to you.
Brendan
She can fix the mortgage rate for 3 years and reduce the rate to 2.45%. At this rate, she would pay off the mortgage quicker - probably in about 7 years.
KBC might refuse to give her this rate as the mortgage has passed its maturity date. So the first thing you should do is to get their agreement to an extension of the term by 8 years. When that is agreed , then apply for the lower rate and they would not be able to refuse it to you.
Brendan