New private mortgage to rent scheme

Brendan Burgess

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Apparently they have no connections with New Beginning :
New Beginning plans to buy 15,000 distressed mortgages from banks

Arizun launches new Mortgage Arrears Resolution Programme



New Mortgage to Rent (MTR) scheme gives distressed mortgage holders a chance to have their mortgage debt cancelled while staying in their homes as long-term tenants


Homeowners in mortgage arrears are being offered a solution, which will cancel their mortgage debt, allow them to rent their home long term, and buy back their home at a later date if they want.


Today the Government announced the extension of the Mortgage to Rent scheme to Independent Providers. Previously the scheme only allowed Approved Housing Bodies to offer MTR. Arizun, an Irish company, is one of the first to launch an independent MTR programme.


Arizun will buy non-performing mortgages from financial institutions in Ireland. Arizun will then work closely with the homeowners to find a resolution that works for them and which can include:


-100% Mortgage debt write-off in return for title transfer

-The mortgage holder continuing to stay in their home, under leases of up to 20 years

-Rental Assistance, depending on circumstances

-The option to buy-back the house after a 5-year period


Individual homeowners who would like to work with Arizun can contact Arizun directly on 061 574000 or through our website [CL1]. They should also contact their financial institution and advise of their interest in the Arizun solution.


Those who don’t wish to work with Arizun may continue with their original lender.


79,562 Irish mortgages are in arrears. Of those, 34,551 are in arrears of more than two years[1]. More than 20,000 cases are in the courts potentially heading for repossession[2].


Arizun is poised to buy in excess of 5,000 distressed mortgages from financial institutions in Ireland. This equates to an investment of €0.75bn in a long-term solution for the current Mortgage Arrears crisis.


“Arizun’s scheme could significantly ease the financial issues of more than 34,000 families whose homes are in serious arrears. Arizun wants to keep families in their homes and prevent a further spiral into homelessness,” said Cathal O’Leary, CEO, Arizun.


“This is a long term solution, developed by an Irish company. Should a householder use the Arizun solution, it will mean they can stay in their own homes for at least 20 years if not more. Giving a householder security of tenure in their own home takes a huge stress from their lives,” he added.


“After five years, a person may have repaired their credit history, be on their feet again and want to buy back their house. Arizun will sell the property at market value, but to help the buyer, will also give them 40% of the 5-year uplift in the house’s value,” he concluded.



About Arizun


Arizun is an Irish company, investing long-term in the residential property market in Ireland. Their programme is designed to address a large portion of the mortgage crisis while keeping families in their homes.
 
Did they get their own web address wrong in their own press release!?

Nothing at and as far as I can see it should be

This site can’t be reached
’s server DNS address could not be found.

DNS_PROBE_FINISHED_NXDOMAIN
 
Well spotted.

I had clicked on the Irish link and got nowhere.

It's a mad scheme and seems designed to put pressure on banks to sell portfolios of distressed mortgages.

"The Arizun Mortgage Arrears Initiative can only be applied to an individual home once the Arizun Funds have acquired a portfolio of mortgages from a European financial institution which includes the mortgage currently held over the individual home."

So the lenders will have to do what Ulster Bank did and sell portfolios of really bad loans very cheaply to Arizun.

By the way , they explained their name as a mix of Arise and Horizon.

So shouldn't they be called Arizon? Sounds, as if someone was locked when they came up with the name.

Brendan
 
Who is behind this crowd? Where are they getting the €0.75bn to buy the mortgages?
 
Apparently they have no connections with New Beginning
Are you sure?

http://www.irishtimes.com/news/cons...each-involving-over-1-000-customers-1.2020378

A group set up to help homeowners in mortgage difficulties has apologised after the names and bank details of over 1,000 customers were passed to a commercial partner.

[broken link removed] emailed a database of names to Malta-based fund Arizun/Casa Mundi, with whom it planned to purchase 5,000 non-performing mortgages from the banks for some €720 million.

...

A €20,000 payment was made to New Beginning the same day the database was sent by email but the mortage group said it was “simply not the case” that the money had changed hands for the names.
 
The lad from Arizun said on radio yesterday that anyone who came over to them would pay 'market rent'.
Now, if you can't afford to pay a mortgage that's on say, a cheap tracker, how can you afford to pay market rent given where rents are at the moment?
 
Hi Delboy

I agree.

But it might just about make sense in the small number of cases where a loan is on SVR and deep negative equity.

A mortgage of €200k on a house worth €100k.

Repayments on €200k @4% over 20 years are €1,211 ( €670 interest)

With a rental yield of 8% on a €100k house, the payment would be €670 per month.

If someone can pay €670 per month, they should try a PIA first. Get the mortgage reduced to €100,000 and the repayments reduced to €600.

Brendan
 
Brendan

what you have given there is a mortgage example in both options.
But with Arizun there'd be no mortgage if you went with them. You'd just pay rent and at market rate. So the rent could be higher than even the SVR mortgage you currently are in default on
 
I found out why there is institutional money now going into these schemes.

Apparently there is very little risk to the investors.

I always wondered why they thought that the former borrowers who were paying nothing to the lenders would bother paying rent to the new owners.

More fool me! The new owners will lease the properties to the local authorities who will pay the rent to the likes of Arizun. The tenants will be tenants of the local authority. If they don't pay their rent, so what? We, the taxpayer, will be paying it for them.

Brendan
 
So Arizun are getting a guaranteed income from the LAs who will themselves be getting a less than reliable income from the tenants!

Why don't the LAs go and get a loan to buy these themselves? From the European Investment Bank as an example- they seem to have money to lend?
Is there some sort of off balance sheet shenanigans going on? Or is it pure laziness/lack of ambition from the LA's?
 
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