Ways To Entice a Bank To Accept a Sale on a Property In Negative Equity?

Peter54

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Hi

I have a cash buyer who is interested in purchasing my heavily indebted home. NE €200,000.00 plus some.

I am anxious for the bank to accept the offer as I do not see a stampede of people knocking my door down to purchase.

I have now ceased mortgage payments to the bank (yes I know . . . but desperate people call for desperate measures) because the bank would not accept my reduced payment offer (it's all that I could afford) so I thought if these guys weren't playing ball then why should I. I simply do not have the money they are looking for.

If they allow the sale of the property they want me to take the NE on as another loan. Again I simply cannot afford to repay it at the moment.

Is there any way in explaining to the bank that they should allow the sale go through? and is there any way I could make the offer look as attractive as possible i.e offer to repay x amount of NE per month after sale.

Folks, any ideas please?
 
My views are subject to what you have told me;
firstly; pay what you can reasonably afford on the mortgage, it shows you to be reasonable.
secondly; if you feel sale is your best option , agree to sell and to take on a loan.
thirdly; when sale etc is completed do a review of your positon and take it from there.
If THEN you are still not able to realistically repay the loan , go to the Bank and try for resolution.
If no resolution it looks like you will have to go to on personal insolvency.and or bankruptcy.
 
Tough one.

Have you asked the bank in advance for permission to sell?

If they do agree to the sale, you have to sign the document agreeing to pay the negative equity. There is no disadvantage to signing this, it is just confirming to you the legal situation. It does not increase your legal liabilities.

Not sure why you stopped paying altogether? You should pay what you can afford, unless you are saving up for a PIA or Debt Settlement Arrangement, which would be fair enough.

Is the offer reasonable? Are you connected with the buyer? Did an independent auctioneer find the buyer? Are they recommending a sale at this price?

If they refuse the offer, then you should consider handing them back the keys and letting them get a higher offer.

Brendan
 
Thank you Gerry.

Should I take on the full NE loan or would it be cheeky on my part to ask for a part write down of the NE portion or do I simply keep my mouth shut and accept the NE loan so the bank releases deeds to perspective buyer?

They have offered me the option of a split mortgage but I am unable to meet the repayment on the split. It is still way too expensive. I have offered them a reasonable figure but they have refused so I think sale is the only option I have left.

They have accused me of being unreasonable but every month I would hand them my earnings but it still wasn't enough so I ended up not paying them anything.
 
Hi Brendan

I stopped paying the mortgage all together because what I was paying them was not enough. I am also trying to gather up money in case I need to rent.

The offer is in keeping with the values in the area.
Auctioneer found the buyer and have recommended the offer should be accepted.
 
I stopped paying the mortgage all together because what I was paying them was not enough.

Sorry, that makes no sense at all. So you are happy enough to be living rent and mortgage free at the moment? That is unreasonable.


I am also trying to gather up money in case I need to rent.

You only need to save up the deposit and one month's rent maximum.

I don't agree with your strategic defaulting on your mortgage. You should continue to pay what you can, with the small exception of putting together a small deposit.

To answer the question, I don't think that this is the right strategy to "entice the bank to accept a sale".

You may be applying for a DSA or a PIA. You should be able to argue that you behaved reasonably at all times. You don't sound reasonable to me.
 
Hi Brendan,

Re-reading what I wrote looks juvenile but I have been told that they are going for repossession shortly anyway so I don't feel inclined to pay anything to them at all.

My quality of life is practically nil anyway. I know what I have just said is annoying to some people but believe me I did not set out to default. I offered the bank the amount I could afford each month and they flatly turned me down. The figure they quoted me for for a split mortgage is also not payable. I don't earn it.

I do not mean to sound smart mouthed but please give me the pros of paying what I can when the bank wont accept my offer and will seek repossession anyway. My good behavior is not going to go for me in this case I don't believe.

I have always been most reasonable but I am deflated in my dealings with the bank, that at all times amount to nothing.
 
I do not mean to sound smart mouthed but please give me the pros of paying what I can when the bank wont accept my offer and will seek repossession anyway.

You have a home.
You should be paying rent or mortgage interest for it. You should not be living rent-free.

This is pure strategic default, which so many people deny exists.
So, legally and morally, you should be paying for your accommodation.

Practically, I think it's a good idea to show that you are reasonable. But I might be naive on this.

Brendan
 
Brendan,

This OP cannot avoid repossession and cannot pay the NE loan that will be left after repossession.

How would he be better off if he made some mortgage payments to the bank now.

If in the 12 months before repossession he paid the bank €10,000 he would be €10,000 worse off after repossession.

You say legally he should pay, well obviously when he doesn't pay the law will take its course and he will suffer the consequences. He will loose his home and his credit rating, but those consequences will be no worse because he paid nothing to his mortgage in the period before repossession.

You say that morally he should pay something. As an opinion that is fine but you put forward no argument to support it., No where have I seen any such argument that goes beyond "he borrowed so he should pay" to address the broader issues.

For a counter argument, how many instance have we seen here where people who make every effort to pay are still repossessed by the banks with not even a thank you.
 
Hi Cremeegg,

I completely agree with your post. Without a doubt the consequences will be the same for me whether I pay what I have now or pay nothing at all. The bank have flat out refused my offer of payment to stay in the property.

I presume I am going to be landed with the legal bills of the bank too. Some form of a nest egg is going to be required as I may have no choice but to travel overseas.
 
You say that morally he should pay something. As an opinion that is fine but you put forward no argument to support it., No where have I seen any such argument that goes beyond "he borrowed so he should pay" to address the broader issues.

I really don't see what further argument you need. If adults enter into an agreement, they should attempt to keep that agreement. If people borrow money, they should pay that money back.

We live in a Society. We should attempt to live by a set of reasonable rules. You don't steal. You keep your word. etc.

how many instance have we seen here where people who make every effort to pay are still repossessed by the banks with not even a thank you.

There have been very few repossessions in Ireland. I have no personal direct experience of anyone who has made, even a basic effort, being repossessed.

What we are getting now is a raft of letters telling people that they should voluntarily sell their home as their mortgage is unsustainable. Many of these people are doing their best to pay their mortgage and should not have received the letters, but the banks were forced to send them by the Central Bank's stupid Targets Regime.

Brendan
 
Brendan,

This OP cannot avoid repossession and cannot pay the NE loan that will be left after repossession.

How would he be better off if he made some mortgage payments to the bank now.

If in the 12 months before repossession he paid the bank €10,000 he would be €10,000 worse off after repossession.

You say legally he should pay, well obviously when he doesn't pay the law will take its course and he will suffer the consequences. He will loose his home and his credit rating, but those consequences will be no worse because he paid nothing to his mortgage in the period before repossession.

You say that morally he should pay something. As an opinion that is fine but you put forward no argument to support it., No where have I seen any such argument that goes beyond "he borrowed so he should pay" to address the broader issues.

For a counter argument, how many instance have we seen here where people who make every effort to pay are still repossessed by the banks with not even a thank you.

Leaving the legal and moral issues aside for a moment. Do you agree that people should pay for their accommodation if they can?

Do you see nothing wrong with any person (not specifically the OP) with someone living mortgage free and using the money that should be paid to live in that property as a "nest egg" to rent somewhere else?

Do you not realise the implications of this behaviour?
I can understand people's frustrations towards the banks - but this example, if followed by everyone in difficulty only exposes the taxpayer to more debt.

You both say that the banks behaviour is unreasonable, yet the OP could afford to pay something off his mortgage each month and he should have done this, not only to repay his debt, but to pay for where he lives.
 
How would he be better off if he made some mortgage payments to the bank now.
You just mean financially better off don't you? It is a morality issue. You could as easily say a thief is better off if he steals something - does that make it okay? Living effectively rent-free when you can afford to pay something is a form of theft. You think that's okay - many people don't agree.
 
The points raised are on a moral basis. Commonsense asks "do you see nothing wrong" that is a moral question. There is nothing wrong with asking a moral question, but that is the basis of your post.

Morality is personal. The Law is applied morality that society puts in place to regulate our dealings with each other.

Why not steal? Because it is morally unacceptable to you? Thats fine, thats admirable! But if you do steal the law will send you to prison. That is the rule society has put in place.

If the OP does not pay anything to his mortgage in the period before repossession he will suffer no legal consequences. That is the law society has put in place. You may think that the law should be different, but we must obey the law not other peoples moral concepts.

Commonsense also asks what are the consequences? We are living in the consequences. People unable to pay their mortgages. New mortgage credit more difficult to find. Unemployment through the roof.

My moral sense tells me that when you say "If people borrow money, they should pay that money back. " You are only looking at half the picture.

If you want to make a convincing argument you must address the issue of the Irish property market in 2006 having been a pyramid scheme. Banks borrowed money from abroad to lend purchasers to buy from developers that banks lent money to buy from landowners.

We ALL took part in the pyramid scheme, even if we didn't understand it. Even people on social welfare who received 3 times the dole that is available in NI.

When the music stopped some of us escaped lightly, some of us were left holding the baby. The moral case that people who bought property in 2006 have to pay a bigger share than people who bought in 2002 say is weak. That is the further argument I would like to see Brendan.
 
The points raised are on a moral basis. Commonsense asks "do you see nothing wrong" that is a moral question. There is nothing wrong with asking a moral question, but that is the basis of your post.

What I said was:
"Leaving the legal and moral issues aside for a moment. Do you agree that people should pay for their accommodation if they can? "

I specifically said to leave morality and even legality aside to hear your opinion.

Morality is personal. The Law is applied morality that society puts in place to regulate our dealings with each other.

But what is your opinion?


Commonsense also asks what are the consequences? We are living in the consequences. People unable to pay their mortgages. New mortgage credit more difficult to find. Unemployment through the roof.

No, sorry I didn't. I said :"Do you not realise the implications of this behaviour? The issues you outline above are not the implications I am talking about.


My moral sense tells me that when you say "If people borrow money, they should pay that money back. " You are only looking at half the picture.

Unfortunately that is going around the issue.



If you want to make a convincing argument you must address the issue of the Irish property market in 2006 having been a pyramid scheme. Banks borrowed money from abroad to lend purchasers to buy from developers that banks lent money to buy from landowners.

it's been addressed to death.

We ALL took part in the pyramid scheme, even if we didn't understand it. Even people on social welfare who received 3 times the dole that is available in NI.

And if we all partook then we should all be responsible.

When the music stopped some of us escaped lightly, some of us were left holding the baby. The moral case that people who bought property in 2006 have to pay a bigger share than people who bought in 2002 say is weak. That is the further argument I would like to see Brendan.

Why compare someone who bought property in 2002 and is fulfilling their moral and legal obligation with someone who isn't?
 
You have said the bank have offered you a split but you can't afford it. Surely the offer has to be based on your Standard Financial Statement and the Reasonable Living Expenses

Are you really going to be any better off renting after your house has been sold/repossessed? Will the rent be less than you would pay under the split mortgage.

If you try to get a Debt Settlement Arrangement on the unsecured debt after a repossession/sale it will still be based on your Standard Financial Statement and Reasonable Living Expenses?
 
you must address the issue of the Irish property market in 2006 having been a pyramid scheme. Banks borrowed money from abroad to lend purchasers to buy from developers that banks lent money to buy from landowners.

We ALL took part in the pyramid scheme.

I wish people would stop saying that we all took part in the scheme.
It is not true.
Only a certain number took part(for their own reasons).

The problem is that we are all being forced to suffer the consequences.
 
You have said the bank have offered you a split but you can't afford it. Surely the offer has to be based on your Standard Financial Statement and the Reasonable Living Expenses

Are you really going to be any better off renting after your house has been sold/repossessed? Will the rent be less than you would pay under the split mortgage.

If you try to get a Debt Settlement Arrangement on the unsecured debt after a repossession/sale it will still be based on your Standard Financial Statement and Reasonable Living Expenses?

Hi Claire, no the split mortgage is not based on SFS and reasonable living expenses it is based on the figure the bank is desired to accept. That is why I am unable to meet my payment. I have offered them all of what I can afford according to my SFS and this has been turned down.

I offered the bank a monthly figure that represents the rent received in the area and they most definitely are not accepting it.
 
Hi Claire, no the split mortgage is not based on SFS and reasonable living expenses it is based on the figure the bank is desired to accept. That is why I am unable to meet my payment. I have offered them all of what I can afford according to my SFS and this has been turned down.

I offered the bank a monthly figure that represents the rent received in the area and they most definitely are not accepting it.

Peter do you wish to keep the house? Because if you do then it would be in your best interests to pay something, anything, off the mortgage each month.
By paying nothing at all you are making it very difficult for the banks to meet you somewhere in the middle.

There is nothing stopping you from lodging the amount you can afford each month - regardless of what they say, at least it will show a willingness to engage,
 
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