Serious advice needed as Bank are now threatening reposssion

Income details
Net monthly between 2400 and 2700
Net monthly income partner/spouse: nature of income
Income history:
Amount of child benefit received 520
Amount of Mortgage Interest Supplement received..nil

Personal circumstances so we can calculate your reasonable living expenses The Insolvency Service has published Guidelines for Reasonable Living Expenses based on the family size, whether or not you need a car for work, childcare costs and other exceptional circumstances. By filling in this information, we (or you ) can calculate what your reasonable monthly living expenses should be.
One adult family or two adult family
Do you need a car for work or do you use public transport?
Number of children 0- 2 years old: 0
Number of 3 years old children: 1
Number of 4 - 11 years old: 1
Number of 12 - 18 years old: 2
Monthly childcare costs: 0
Montly spend on special circumstances: e.g. exceptional healthcare costs



Home loanLender: pepper
Amount outstanding: 350000
Value of home: 220000
Interest rate: specify whether tracker or SVR or fixed rate fixed 5.25%
Monthly repayment 1575
Amount in arrears 50,000

Summary of discussions and agreements with the bank:: have been paying as much as possible to them over the last three years. have asked for split mortgage. refused. told I did not meet the criteria. have asked about MTL Scheme told I earn too much. Last submitted SFS shows affordability of 751 euros

Investment property

KBC Bank
Home loanLender: pepper
Amount outstanding: 167000
Value of home: 90,000
Interest rate: specify whether tracker or SVR or fixed rate fixed 5.25%
Monthly repayment 1575
Amount in arrears 32000


Other loans and creditors - delete those which don't apply to you
Overdraft - amount outstanding:
Credit Card - amount outstanding
Credit Card - monthly amount you are paying
Term loan Amount outstanding
Term loan term left
Term loan - monthly repayment
Term loan - interest rate
Family loan - amount outstanding
Family loan - monthly repayment

Other savings and investments

Do you expect any lump sums in the medium term future? Redundancy, inheritances, injuries awards. no


How important is retaining the family home to you? Which of the following best describes your situation?

I really want to try and keep our family home and need advise. things have started getting a bit better for me but I am seriously considering stopping engaging with Pepper and all payments to them because I feel they have now given up on me and there whole attitude seems to be that repossesion in inevitable..


Any other relevant information

What is your preferred realistic outcome? For example: "I will never be in a position to repay the home loan. So I want to sell the house and deal with the shortfall"

The sad reality is that your mortgage is completely unsustainable.
Even if they were to switch you to interest only, you would pay €350k @4.5% which would be €16,000 a year.
If they warehoused the negative equity and left you with an active mortgage of €220,000 @4.5%, interest only, you would pay €10,000 a year or €825 a month. You can't afford that either.

On top of that, you have an unsustainable investment mortgage.

You should enter into discussions with Pepper about a voluntary sale of both properties and a write-off of the shortfall.

If they don't agree to this, then you should agree a voluntary sale of your investment property, but refuse to sell your home, as you have no alternative.

If they do agree to write off the shortfall, you should surrender your home.

You could also agree to the voluntary sale and seek to have the shortfall dealt with through a Personal Insolvency Arrangement or bankruptcy.

Brendan

Hi Brendan.
Thanks for the advise. you see my only concern is my family home. i know that my salary is getting stronger and given time to prove it I could sustain payments of 900 per month on my family home, but the bank do not seem interested, which is making me think I should pay them as little as possible and go down the backrupcy route but I would be taking a chance that the OA would be able to come up with a plan for us to retain our family home. I really feel let down at this stage by the bank. i must stress that I have been paying something every month. I wonder is it in any way due to the fact that over the past six months or so there is a marked improvment in house prices so narrowing the gap between the value of my home and the amount outstanding on the mortgage. ie 12 months ago my type of house was making 160, 000. now they are making 210 - 220....

Quofan said:

I really feel let down at this stage by the bank.

Click to expand...

You have not been let down by the bank.

You have an unsustainable mortgage, pure and simple. Your mortgage is 10 times your income! The new Central Bank guidelines for borrowers these days is 3.5 times income.

The lenders do very generous restructuring where there is some chance that the borrower can repay the mortgage. They have attempted to facilitate you for some years now. In any other country, your home would have been repossessed after a few months' arrears.

On a salary of €2,700 net per month, you cannot afford to live in a house this size. It's not the lender's responsibility to house you.

I don't see how you can keep your home in bankruptcy. If you go bankrupt, the OA will ask the lender what they want to do and they will say that they want the house sold and to receive the proceeds.

You have to face up to the harsh reality that you are going to lose your home.

Brendan

Quofan.

Sadly, what Brendan advises sounds like your only option.