Repossessed house with outstanding Judgement Mortgages

T

Time

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Just a general question.
Let's say a bank takes a defaulter to court and gets a possession order for a house that has one or more judgement mortgages registered against it.

The bank will take possession and will try to sell it. What happens to the judgement mortgages that are on the house? Does the bank have a good title in order to sell or will the bank have to discharge the the JM's before attempting to sell it? Or would the JM's have to be paid from whatever the bank gets thus increasing any potential shortfall?

Just curious about the processes involved.
 
No JM holders must vacate if proceeds of sale are insufficient to cover the prior charges. Bank solicitors will deal with them. A pain in the ass for the Bank but will not result in them being paid!
 
44brendan said:
No JM holders must vacate if proceeds of sale are insufficient to cover the prior charges. Bank solicitors will deal with them. A pain in the ass for the Bank but will not result in them being paid!
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I'm interested in this - do you have a legislative citation? Just for my own information.

Thanks

mf
 
I'm interested in this - do you have a legislative citation? Just for my own information.
Click to expand...

A JM is effectively a burden on the title of the property, somewhat similar to a mortgage. Legally burdens rank in accordance with their time of registration. i.e. if you register a charge on a property and there are existing charges in place, then you rank after these existing charges. Bank mortgages are generally "all sums due" which means that the Bank will be fully paid the amount that they are owedon any loans in the name of the client before a subsequent charge holder gets anything. The legal standard is "first in time prevails"!
 
44Brendan;

Does a Judgment Mortgage attract the 8% annual interest?
I assume not , but please let me know.
Thanks.
 
The judgement does.
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Yes 8% (simple interest) is the standard Court rate for judgements. A JM will accumulate annualy by this amount. i.e. If a creditor obtained a judgement against you 2 years ago for €1,000 and registered this against your property, it would cost you 1,160 to satisfy that judgement today and remove the JM from the property.
 
Would the debtor be still liable for the amount of Judgement Mortgage once house has been repossessed and sold?
 
Of course they would be. The underlying judgement would be still valid. The only issue would be getting a current address for the debtor.
 
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