Negative equity. Can the bank sue me for the balance?

[scrivere]

Oh please don't let this turn into another blame the banks thread.

Have you spoken to the bank, unlike John Rambo I suggest you are very honest with them. No point in telling the you are only getting x for the app when you are getting y. They will ask for proof. Have the bank declined to allow you sell house and take the lost or even some of the loss. (50/50) You may need to go high up in the bank... senior mgt but worth it.

If that doesn't work:
Yes they can "come after you" for the 50k but don't let it come to that they should come to an arrangement with you, ok so its not great that you have to pay even though you have no house but not much you can really do.

 

[John Rambo]

Oh please don't let this turn into another blame the banks thread.

Have you spoken to the bank, unlike John Rambo I suggest you are very honest with them. No point in telling the you are only getting x for the app when you are getting y. They will ask for proof. Have the bank declined to allow you sell house and take the lost or even some of the loss. (50/50) You may need to go high up in the bank... senior mgt but worth it.

If that doesn't work:
Yes they can "come after you" for the 50k but don't let it come to that they should come to an arrangement with you, ok so its not great that you have to pay even though you have no house but not much you can really do.

I never suggested being dishonest. I merely confirmed that although the OP clearly owes the bank the €50K, in reality he should be able to negotiate a settlement. And by the way. that would involve a 67/33 split of the losses, not 50/50 as you've suggested.

 

[scrivere]

Sorry could have picked my words more carefully, didn't mean to offend you at all. Worth trying 67/33 with them however getting the bank to agree to any loss when the OP has an other house(s) will be an achievement.

 

[dereko1969]

To their credit, the bank refused to give me a mortgage on a second property, so I had to invest the remainder in stocks and shares.

I'm confused. Is the mortgage actually on your home or on the apartment? Did you have to take all the money suggested?

Either way, blaming anyone other than yourself, while the easy way out, is wrong. It was your decision, no-one elses, blaming your solicitor now is also wrong, did you ask the relevant questions at the time?

 

[euclid]

I'm confused. Is the mortgage actually on your home or on the apartment? Did you have to take all the money suggested?

Either way, blaming anyone other than yourself, while the easy way out, is wrong. It was your decision, no-one elses, blaming your solicitor now is also wrong, did you ask the relevant questions at the time?

1. Read the thread. It's perfectly clear.

2. I'm not blaming anyone, as you'll see if you read the thread. I am simply highlighting the point that I thought the apartment was (the only) collateral for the mortgage. It was quite a shock to discover that my family home would be at risk now if I couldn't afford to pay off the balance of the loan.

3. I asked every question I could think of at the time, but the word "unsubordinated" was not in my vocabulary until a couple of weeks ago.

 

[mercman]

the government. Bertie and his finance minister have a lot to answer for.

Another one, Blame the Government. I bet if you had of been making an extra €100 you wouldn't be running to give them an extra lump of tax. Nobody forced you to purchase the property. Basic rules of business and in fact life. If you borrow you have to pay it back, In the case of Banks they hold a licence to lend money at a legal rate instead of high cost moneylenders. They may do a deal or they may not. I'm no lover of the Banks but I do know if I owe them they will have to be repaid. And as long as there is an issue of outstanding loans they have a hold. Quite simple really.

 

[Brendan Burgess]

1. Read the thread. It's perfectly clear.

Euclid

It might be perfectly clear to you, but I am confused as hell.

To their credit, the bank refused to give me a mortgage on a second property, so I had to invest the remainder in stocks and shares.

The remainder of what?

we are house owners with obvious means.

I guess that this means that you and your spouse own another house. But it could mean that you own a few houses.

If you have obvious means, then just pay off the loan.

 

[chlipps]

Euclid...is selling your own house an option and move into the apartment? Is your own house worth more than the apartment?

 

[Palabra]

Oh please don't let this turn into another blame the banks thread.

My problem with the banks is that they were the key players in all of this, yet they think that they should take no hit whatsoever on these deals.

Yes I chose to buy a house to live in.(or even as an investment!!)

But the banks chose to lend shed loads of money they didn't have.

The banks chose to run up massive debt to asset ratios

The banks chose to finance any hair-brained, back of beyond, middle of nowhere development that applied to them.

The banks chose shovel money into the property market to keep the gravy train fueled.

In effect they chose to stop behaving like banks

They chose to do this because it meant they could gorge themselves on obscene bonuses and profits.

Now the manure has hit the fan their attitude to the OP and the rest of us in this sorry mess is "thats your problem pal, we're ok the government is sorting us out"

 

[pjmn]

My problem with the banks is that they were the key players in all of this, yet they think that they should take no hit whatsoever on these deals.

Yes I chose to buy a house to live in.(or even as an investment!!)

But the banks chose to lend shed loads of money they didn't have.

The banks chose to run up massive debt to asset ratios

The banks chose to finance any hair-brained, back of beyond, middle of nowhere development that applied to them.

The banks chose shovel money into the property market to keep the gravy train fueled.

In effect they chose to stop behaving like banks

They chose to do this because it meant they could gorge themselves on obscene bonuses and profits.

Now the manure has hit the fan their attitude to the OP and the rest of us in this sorry mess is "thats your problem pal, we're ok the government is sorting us out"

... but it doesn't take away from the fact that, you, me and the OP, made the initial decision, and for that reason I don't believe any of us can walk away from that decision and blame bankers, developers and/or Govt, we are all to blame and each of us needs to take responsibility for our own actions... IMHO.

 

[irishmoss]

From my reading of this the OP had some cash.

Rather then invest the full amount of money he was advised to leverage as much as possible so he got an interest only mortgage for 4 years in the hope he could gain money and clear it off.

The ramainder of money he invested in Anglo

I can't answer his question but offer my sympathy

 

[queenlex]

Yes, I got the very best financial advice available at the time. Remember that the housing market was booming then. I was advised to put as much as possible into "bricks and mortar".

God who gave you this advice as best advice a bank salesperson? I have never heard an adviser give advice to put all your eggs in one basket which is what is implied here???

 

[mercman]

The contents of this thread is the full extent of the boom bust scenario we are all experiencing. They fueled the supply /demand curve. Simple as that. If we all chose to read the applications, it said 'you must keep up with your mortgage payments or else your property could be at risk or words to that effect.

 

[Marietta]

Yes you are right Mercman, however I can't help but wonder about the advice this man received, he got a quarter of a million euros of a loan from a bank when he was approaching 60 years of age. It is not that long ago that once a person went past the ages 45 - 50 they were refused a mortgage based on their age alone. The OP has to take individual responsibility but also the bank that so recklessly gave him this money has to take some responsibility in the matter. Where were the financial regulators during all these celtic tiger years that nobody shouted stop to what was going on. How many thousands more people are now in exactly the same situation.

The Op didnt say where he got the money to invest maybe it was a redundacy deal, a inheritance or his life savings but it is hard not to feel sorry for him for it is a huge amount of money to lose.

 

[Brendan Burgess]

It is not that long ago that once a person went past the ages 45 - 50 they were refused a mortgage based on their age alone.

Yes, they were the good old days before the Equality Act. If a bank tried to refuse somoene a loan on the grounds of age alone, they would be found guilty of age discrimination.

Brendan

 

[mercman]

however I can't help but wonder about the advice this man received, he got a quarter of a million euros of a loan from a bank when he was approaching 60 years of age.

The OP is over 60. He is 64 and retired. See the original first post. The main problem here was that €1 million was not a lot of money and every Joe was spitting out these kind of ridiculous numbers and values like Confetti at a wedding.

The entire Irish society made it all too easy and anybody that was in doubt it was clearly dismissed as thoughtless. From where we all are now, we all need to wake up and smell the coffee. Just have a look at all the other European countries and the apportionment of wealth.

 

[Marietta]

Yes, they were the good old days before the Equality Act. If a bank tried to refuse somoene a loan on the grounds of age alone, they would be found guilty of age discrimination.

Brendan

So Brendan, was it normal practise for a bank to give a 1/4 million euro loan to an elderly man during the boom years?? Surely this cannot be right.........

 

[Gervan]

It's not unlikely that the OP could be expecting a large tax-free lump sum from pension maturation, with which he would pay off the interest only mortgage. He did say it was only a 4 year loan, so the bank obviously did expect him to be able to pay it off.

 

[Palabra]

The OP has to take individual responsibility but also the bank that so recklessly gave him this money has to take some responsibility in the matter.

My point exactly

 

[bacchus]

Re: Unsubordinated?

My heart goes out to you and thousands like you that are in the same position,

Why? Business is business, the OP simply made a bad investment and can only blame himself, not the facilitators, e.g. bank for agreeing to lend money. Don't invest what you can not afford to loose.