To give borrowers every opportunity to rescue the situation. Giving some banker, who gave out a 100% mortgage that was 5 times salary over 35 years, gave a 5 year fixed rate because a variable rate would not pass a stress test, got high fives from the Central Bank for doing this, should not be given speedy possession orders imo.
Report on today's Cork repossession court
- Thread starter Brendan Burgess
- Start date
To give borrowers every opportunity to rescue the situation. Giving some banker, who gave out a 100% mortgage that was 5 times salary over 35 years, gave a 5 year fixed rate because a variable rate would not pass a stress test, got high fives from the Central Bank for doing this, should not be given speedy possession orders imo.
And the poor auld innocent borrower, who just happened to be walking by the Bank when they were lassoed in and forced to sign up to a huge mortgage. After doctoring their payslips to make bonuses/expenses look like basic salary and building in rent-a-room into their repayments calcs.
Takes 2 to tango but the ongoing arrears debacle is showing there's only 1 winner!
Fair enough but bear in mind that proceedings cannot be initiated until the borrower has exited the lengthy MARP process and the first appearance is automatically adjourned pursuant to a Circuit Court practice direction. In other words, a defaulting borrower will already have been given ample time to agree a restructured, sustainable arrangement with their lender.
Sophrosyne
Registered User
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I note that in case 7 of the cases adjourned by the County Registrar, that “payments have regularly and recently been made.
Tenants of the property had representation in court. Wish to stay in the property. Offered to pay rent directly to the bank.
Noted from previous hearing (when bank wished to adjourn):
Adjourned as per the practice direction.”
In case 8, “Borrowers legal representative has written to the bank six times without reply. Response that bank has replied “today”.
No payments being made. Profound financial difficulties.
Has found a buyer for the property.
Noted from previous hearing (when bank wished to adjourn):
Adjourned as per the practice direction.
Some engagement from borrower; has proposed sale of property.”
Surely, these adjournments were justified.
Of the 10 cases adjourned by the County Registrar, previous adjournments were requested by the banks, rather than the borrower, in 5 of those cases.
Tenants of the property had representation in court. Wish to stay in the property. Offered to pay rent directly to the bank.
Noted from previous hearing (when bank wished to adjourn):
Adjourned as per the practice direction.”
In case 8, “Borrowers legal representative has written to the bank six times without reply. Response that bank has replied “today”.
No payments being made. Profound financial difficulties.
Has found a buyer for the property.
Noted from previous hearing (when bank wished to adjourn):
Adjourned as per the practice direction.
Some engagement from borrower; has proposed sale of property.”
Surely, these adjournments were justified.
Of the 10 cases adjourned by the County Registrar, previous adjournments were requested by the banks, rather than the borrower, in 5 of those cases.
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D
Descart
Guest
Delboy, sorry to burst your bubble but:
The doctoring of payslips / mortgage applications was also being perpetrated by Bank employees in order to achieve their bonuses ( usually with managements knowledge ). Without being too specific read this indo's piece:
Ex-bank worker who forged documents avoids jail
[broken link removed]
Twitter
Published 13/12/2014 | 02:30
"A former bank official who pleaded guilty to forging documents for mortgages told detectives everybody was doing it, and those who met their targets were treated like heroes."
Delboy,
"Ex Turpi causa non oritor actio" springs to mind." From a dishonourable cause an action does not arise." I wonder how many borrowers are indeed victims of fraudulent misrepresentation, or mortgage fraud, on the part of the banks, an interesting topic for investigation and discussion, don't you think.
The doctoring of payslips / mortgage applications was also being perpetrated by Bank employees in order to achieve their bonuses ( usually with managements knowledge ). Without being too specific read this indo's piece:
Ex-bank worker who forged documents avoids jail
[broken link removed]
Published 13/12/2014 | 02:30
"A former bank official who pleaded guilty to forging documents for mortgages told detectives everybody was doing it, and those who met their targets were treated like heroes."
Delboy,
"Ex Turpi causa non oritor actio" springs to mind." From a dishonourable cause an action does not arise." I wonder how many borrowers are indeed victims of fraudulent misrepresentation, or mortgage fraud, on the part of the banks, an interesting topic for investigation and discussion, don't you think.
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"I wonder how many borrowers are indeed victims of fraudulent misrepresentation on the part of the banks, an interesting topic for investigation and discussion, don't you think."
I have a problem with this statement.
I agree that there was far too much reckless lending/ borrowing going on, but someone who freely borrows more than they can ever , possibly repay is not a victim of fraudulent misrepresentation. They may be victims of the downturn in the economy but they did sign up for the loans.
I have a very old fashioned idea of not borrowing more than I can afford to repay. Did too many people not actually understand the basic economics of mortgages?
mf
I have a problem with this statement.
I agree that there was far too much reckless lending/ borrowing going on, but someone who freely borrows more than they can ever , possibly repay is not a victim of fraudulent misrepresentation. They may be victims of the downturn in the economy but they did sign up for the loans.
I have a very old fashioned idea of not borrowing more than I can afford to repay. Did too many people not actually understand the basic economics of mortgages?
mf
A
Asphyxia
Guest
Descart,
Spot on.
Spot on.
Gerry Canning
Registered User
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mf1.
With you on borrowing what you can afford.
Fraudulent misrepresentation , is too strong , but there is little doubt that too many Bank officials got the financially naiive to believe the hype , so betwixt and between lender and borrower they self -deluded and self -convinced.
There is no doubt that Banks (primed) their generally honest staff into a frenzy of lend ,lend ,lend ,and a % of said staff connived to get deals over the line eg signed some stuff.The staff were helped by intoxicated borrowers?
On Repo cases.
I wonder if Banks paperwork/title etc was OK, would cases be adjourned so much?
It was reported some time back that 18% of mortgages had poor paperwork that would make enforcement/repo impossible.
..
With you on borrowing what you can afford.
Fraudulent misrepresentation , is too strong , but there is little doubt that too many Bank officials got the financially naiive to believe the hype , so betwixt and between lender and borrower they self -deluded and self -convinced.
There is no doubt that Banks (primed) their generally honest staff into a frenzy of lend ,lend ,lend ,and a % of said staff connived to get deals over the line eg signed some stuff.The staff were helped by intoxicated borrowers?
On Repo cases.
I wonder if Banks paperwork/title etc was OK, would cases be adjourned so much?
It was reported some time back that 18% of mortgages had poor paperwork that would make enforcement/repo impossible.
..
Sophrosyne
Registered User
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There is no excuse for fraud by either borrower or bank.
However, I think it says something of banking ethos at the time in that growth and targets prevailed over common sense.
Previously, people (and there were always some) who tried to borrow above their means were simply refused.
Therefore, it was banks rather than borrowers, which changed the culture.
However, I think it says something of banking ethos at the time in that growth and targets prevailed over common sense.
Previously, people (and there were always some) who tried to borrow above their means were simply refused.
Therefore, it was banks rather than borrowers, which changed the culture.
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D
Descart
Guest
Now MF1,
Let us look at the settled law in Ireland in relation to Fraudulent misrepresentation. In relation to contracts; the effect of a misrepresentation is to make it voidable by the injured party who can then choose (subject to some qualifications) whether to set it aside and treat it as if it had never been made (this is called rescission) or to continue with it. The injured party can claim damages and a Judge may consider the actions of the bank in relation to the matter to be so unconscionable as to render the contract unenforceable, or to award damages that would effectively write off the mortgage in it's entirety.
The BSkyB v EDS case in which judgment was given on 26 January 2010 is a useful reminder of the consequences of making a fraudulent misrepresentation. The judge found that EDS had made fraudulent misrepresentations as to its ability to deliver a project within a certain timetable and in particular that it had carried out a proper analysis to enable it to make this statement. The judge also found that it was a result of these misrepresentations that BSkyB had been induced to enter into the contract with EDS. The damages that could be payable as a result have been estimated at £200 million or more. There was a limit of liability in the contract to £30 million but both parties have accepted that such a limit is not effective to limit liability for fraudulent misrepresentation.
Another plus, so as to speak for the borrower, is that the statute of limitations does not apply in it's normal sense. The injured party has 6 years to instigate a legal action from the time they become aware of the fraudulent misrepresentation.
The fraudulent misrepresentation would have been instigated by the employee of the bank against the bank. The injured party in this case, however, would not be the bank, but in fact the borrower, as it would be argued that the offence of fraudulent misrepresentation by the employee would be deemed to have been committed by the body corporate. In any court case it could also be argued that the bank itself was in breach of section 16 European Commission ( licensing and supervision of credit institutions ) 1992. a breach of which, can lead to imprisonment for up to 6 months. ( see Supreme Court ruling BCM Hanby Wallace v KBC bank )
FBI Reports 80% of Mortgage Fraud Committed by Lenders
When most people think of mortgage fraud, they think of a clever borrower conning an unwitting banker into extending him a loan he cannot afford. But this isn’t really how fraud usually works in the mortgage business. According to the FBI, 80% of mortgage fraud is committed by lenders.
Let us look at the settled law in Ireland in relation to Fraudulent misrepresentation. In relation to contracts; the effect of a misrepresentation is to make it voidable by the injured party who can then choose (subject to some qualifications) whether to set it aside and treat it as if it had never been made (this is called rescission) or to continue with it. The injured party can claim damages and a Judge may consider the actions of the bank in relation to the matter to be so unconscionable as to render the contract unenforceable, or to award damages that would effectively write off the mortgage in it's entirety.
The BSkyB v EDS case in which judgment was given on 26 January 2010 is a useful reminder of the consequences of making a fraudulent misrepresentation. The judge found that EDS had made fraudulent misrepresentations as to its ability to deliver a project within a certain timetable and in particular that it had carried out a proper analysis to enable it to make this statement. The judge also found that it was a result of these misrepresentations that BSkyB had been induced to enter into the contract with EDS. The damages that could be payable as a result have been estimated at £200 million or more. There was a limit of liability in the contract to £30 million but both parties have accepted that such a limit is not effective to limit liability for fraudulent misrepresentation.
Another plus, so as to speak for the borrower, is that the statute of limitations does not apply in it's normal sense. The injured party has 6 years to instigate a legal action from the time they become aware of the fraudulent misrepresentation.
The fraudulent misrepresentation would have been instigated by the employee of the bank against the bank. The injured party in this case, however, would not be the bank, but in fact the borrower, as it would be argued that the offence of fraudulent misrepresentation by the employee would be deemed to have been committed by the body corporate. In any court case it could also be argued that the bank itself was in breach of section 16 European Commission ( licensing and supervision of credit institutions ) 1992. a breach of which, can lead to imprisonment for up to 6 months. ( see Supreme Court ruling BCM Hanby Wallace v KBC bank )
FBI Reports 80% of Mortgage Fraud Committed by Lenders
When most people think of mortgage fraud, they think of a clever borrower conning an unwitting banker into extending him a loan he cannot afford. But this isn’t really how fraud usually works in the mortgage business. According to the FBI, 80% of mortgage fraud is committed by lenders.
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Sophrosyne
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Just to get back to the repossessions, the Cork report shows that of the 95 cases:
- 58 cases were adjourned by the lenders
- 10 orders for possession were granted
- 10 cases were adjourned by the County Registrar - of those, 5 were previously adjourned because the bank did not wish to proceed.
- 9 couldn’t proceed because service hadn’t been completed
- 8 cases were struck out.
Brendan Burgess
Founder
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Séamus has updated the thread for the hearings the following day:
UPDATE #2: The last hearing before the summer break took place on July 30th. Hearings will recommence in October! There were 87 cases listed yesterday. The outcomes were:
It can be seen that orders were only granted against borrowers who were absent. All borrowers who were presented or represented in court had their cases adjourned. There were two cases adjourned where the lenders wished to proceed in spite of the borrower being absent.
UPDATE #2: The last hearing before the summer break took place on July 30th. Hearings will recommence in October! There were 87 cases listed yesterday. The outcomes were:
- 75 adjournments
- 63 adjourned by the lenders
- 12 adjourned by the (visiting) County Registrar
- 6 cases were struck out
- 6 orders for possession were granted.
It can be seen that orders were only granted against borrowers who were absent. All borrowers who were presented or represented in court had their cases adjourned. There were two cases adjourned where the lenders wished to proceed in spite of the borrower being absent.
Brendan Burgess
Founder
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I am not sure if it's two months.
Here are the sitting dates for the Circuit Courts.
[broken link removed]
They are closed for August, but some seem to be sitting in September.
Brendan
Here are the sitting dates for the Circuit Courts.
[broken link removed]
They are closed for August, but some seem to be sitting in September.
Brendan
D
Descart
Guest
Because they can, and who is going to stop them, separation of powers and all that jazz.
It's hard enough to schedule courts during regular sittings, if you had to work around most of the clients, solicitors, barristers and judges taking 2 weeks holidays as well, it would be even worse. At present people who work in the Courts generally only take holidays in August as they know they are unlikely to have a case which will need adjourning then (unlikely as they don't actually fully close).
I am aware of a case which was scheduled to be heard on the first day of an appeals session (a Tuesday). The Judge wouldn't hear a case on the first day as he would only deal with pleas. The Garda wasn't available on the Wednesday. The barrister was at a different court on the Thursday and the client was abroad on the Friday. Result - 6 month adjournment to the next sitting. Multiply that by the most popular month for holidays!
D
Descart
Guest
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