Hi Brendan,
Could you tell me more about this?
Is a guarantor classed as a 'borrower' by the bank?
If the guarantor refuses to submit a SOFP is that deemed as being an uncooperative borrower?
Are KBC charging interest on the parked portion?
Thanks.
What happens if a guarantor does not engage?
- Thread starter G1973
- Start date
Hi Brendan,
Could you tell me more about this?
Is a guarantor classed as a 'borrower' by the bank?
If the guarantor refuses to submit a SOFP is that deemed as being an uncooperative borrower?
Are KBC charging interest on the parked portion?
Thanks.
Brendan Burgess
Founder
- Messages
- 52,294
With a split mortgage, the payments and interest rate are reduced, so the borrower has to pay less. This makes it less likely that the guarantee will be called in.
No. I have not seen a KBC split mortgage
Have they offered you a split mortgage?
Not sure what you mean. They have the liabilities of the borrower, if the borrower defaults.
Hi Brendan,
Thank you for responding.
KBC have not offered me a split mortgage - I have requested one after maintaining 4 years of interest only payments of €800 per month.
The reason I asked you about the guarantor being deemed a 'borrower' was in relation to the changes introduced last year for dealing with mortgage arrears and resolution - I believe it was section 26 or 28 that stated that a bank could immediately move to repossess if the 'borrower' failed to engage - my guarantor has refused to provide his financial statements in the resolution process.
I have spoken with the New Beginnings Group today. They have a new name now and are providing an intermediary service between bank and borrower. They seemed to be of the opinion that the bank requested my guarantor's financials in order to ascertain if he could make up the shortfall on the full mortgage!
I was the party that instigated the resolution process at this moment in time - not KBC. I felt that the recommendations enforced late last year were forcing banks to resolve the mortgage arrears crisis.
Am I clutching at straws in the hope of attaining a split mortgage?
(I am a single mother of two children in [thankfully] gainful but underpaid employment)
Thank you for responding.
KBC have not offered me a split mortgage - I have requested one after maintaining 4 years of interest only payments of €800 per month.
The reason I asked you about the guarantor being deemed a 'borrower' was in relation to the changes introduced last year for dealing with mortgage arrears and resolution - I believe it was section 26 or 28 that stated that a bank could immediately move to repossess if the 'borrower' failed to engage - my guarantor has refused to provide his financial statements in the resolution process.
I have spoken with the New Beginnings Group today. They have a new name now and are providing an intermediary service between bank and borrower. They seemed to be of the opinion that the bank requested my guarantor's financials in order to ascertain if he could make up the shortfall on the full mortgage!
I was the party that instigated the resolution process at this moment in time - not KBC. I felt that the recommendations enforced late last year were forcing banks to resolve the mortgage arrears crisis.
Am I clutching at straws in the hope of attaining a split mortgage?
(I am a single mother of two children in [thankfully] gainful but underpaid employment)
Brendan Burgess
Founder
- Messages
- 52,294
Hi G
That is a very interesting question.
You were given a higher mortgage than you would have otherwise been given, because you had a guarantor.
The guarantor is not engaging but you are.
KBC have no reason to offer you a split mortgage. If you can't make your full repayments, they can go after the guarantor.
Have you tried to get the guarantor to engage?
Can you show KBC evidence of your attempts?
If the guarantor has no money, KBC is more likely to give you deal. But if the guarantor is good, they won't.
brendan
That is a very interesting question.
You were given a higher mortgage than you would have otherwise been given, because you had a guarantor.
The guarantor is not engaging but you are.
KBC have no reason to offer you a split mortgage. If you can't make your full repayments, they can go after the guarantor.
Have you tried to get the guarantor to engage?
Can you show KBC evidence of your attempts?
If the guarantor has no money, KBC is more likely to give you deal. But if the guarantor is good, they won't.
brendan
My guarantor is a close relative. I do not wish for my guarantor to make up the shortfall i.e. I wish to resolve the situation myself.
I have forwarded a letter to the bank stating that my guarantor will not supply his financial details. The arrears support unit has indicated to me that they will attempt to push the process forward with this letter.
Is it not in both the bank's and my interest to find a resolution suitable to both parties, by this I mean the split mortgage option? I am sure there are substantial legal fees and a lengthy and difficult process involved in the event of a forced sale or in the pursuit of monies from my guarantor.
Basically, is it not better for the bank to recover the debt from me, the borrower, through this route as opposed to a protracted and costly legal battle?
I have forwarded a letter to the bank stating that my guarantor will not supply his financial details. The arrears support unit has indicated to me that they will attempt to push the process forward with this letter.
Is it not in both the bank's and my interest to find a resolution suitable to both parties, by this I mean the split mortgage option? I am sure there are substantial legal fees and a lengthy and difficult process involved in the event of a forced sale or in the pursuit of monies from my guarantor.
Basically, is it not better for the bank to recover the debt from me, the borrower, through this route as opposed to a protracted and costly legal battle?
Brendan Burgess
Founder
- Messages
- 52,294
You haven't given any figures.
Split mortgages cost the banks money if they don't charge interest on the warehouse.
If you are in positive equity, they should repossess your property.
If you are in negative equity, they should take legal action against your guarantor if he has assets, which I presume he has.
Brendan
Split mortgages cost the banks money if they don't charge interest on the warehouse.
If you are in positive equity, they should repossess your property.
If you are in negative equity, they should take legal action against your guarantor if he has assets, which I presume he has.
Brendan