3 Mortgages and under serious pressure - HELP

D

DAVID1974

Registered User
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15
Hello,
Can anybody with financial and legal experience provide advice on the following scenario I'm in?

I live in Dublin

I'm 38 married with 2 kids under 5, my ppr property is with Ulster Bank on an interest only basis since we purchased in July 2007, the banks wrote in May of this year stating we will be taken off interest only payments and onto full repayments. The mortgage taken out was 450k and still is 450k. I have gone through MARP yesterday, only to be told the income Vs outgoings "on paper" stands at 327€ + .This does not reflect the true situation on the ground, I have historical debt from past lettings where tenants done a runner owing 3500€ plus other out of the blue expenses like car repairs etc etc. We cannot afford the full repayment and in receipt of letters from U Bank stating the capital shortfall since July 2012. All I was seeking was to be retained on interest only for another year. (I know its a false economy as its leading nowhere, I'm hoping when the markets improve slightly I will off load some, or all properties)

Rental Properties

I also have 2 rental properties which are paying for themselves, both on interest only. one property is on a tracker which I want to protect by all means, the other property is on a standard variable, where the rent doesn't cover the mortgage.

I must default on the variable mortgage to use this rent to supplement the PPR at all costs?, the problem with this is the bank will sell it and pursue me for the shortfall plus interest.

However, if I continue to ignore the banks request to pay the capital and interest on my PPR I may loose that property.

Any advice?

Regards
David
 
DAVID1974 said:
Hello,
Can anybody with financial and legal experience provide advice on the following scenario I'm in?

I live in Dublin

I'm 38 married with 2 kids under 5, my ppr property is with Ulster Bank on an interest only basis since we purchased in July 2007, the banks wrote in May of this year stating we will be taken off interest only payments and onto full repayments. The mortgage taken out was 450k and still is 450k. I have gone through MARP yesterday, only to be told the income Vs outgoings "on paper" stands at 327€ + .This does not reflect the true situation on the ground, I have historical debt from past lettings where tenants done a runner owing 3500€ plus other out of the blue expenses like car repairs etc etc. We cannot afford the full repayment and in receipt of letters from U Bank stating the capital shortfall since July 2012. All I was seeking was to be retained on interest only for another year. (I know its a false economy as its leading nowhere, I'm hoping when the markets improve slightly I will off load some, or all properties)

Rental Properties

I also have 2 rental properties which are paying for themselves, both on interest only. one property is on a tracker which I want to protect by all means, the other property is on a standard variable, where the rent doesn't cover the mortgage.

I must default on the variable mortgage to use this rent to supplement the PPR at all costs?, the problem with this is the bank will sell it and pursue me for the shortfall plus interest.

However, if I continue to ignore the banks request to pay the capital and interest on my PPR I may loose that property.

Any advice?

Regards
David
Click to expand...

If you are in negative equity on your PPR I doubt very much if the bank will be rushing to repossess if you can continue paying interest only !
 
DAVID1974 said:
both on interest only.
one property is on a tracker which I want to protect by all means,
the other property is on a standard variable, David
Click to expand...

Your story is impossible to follow. Can you do the case study or just post up details of each property.

And the statement that you want to keep the tracker at all costs, despite the fact you may put your PPR at risk.

Why are so many people on AAM so obsessed with their trackers.
 
3 mortgages

Hello David,

I have to say your situation is very typical of a lot of people in Ireland at the moment. It is identical to mine!

But maybe I am a little further into the woods then you are.

I can tell you from experience the bank will not pursue you if you opt to just pay what you can, instead of what they are telling you too. The last thing they want is the house back! Of course they will then start to tell you that arrears are accruing on the mortgage account.

But my advice is no to be afraid of this. They can recapitalize arrears at the push of a button. They will tell you they can't, but they can.

The most important thing I will make you aware of is, if your current account is with Ulster Bank also, they will swamp your account with there mortgage direct debits and not only take any money that is there, but also run you into an overdraft situation only to facilitate there mortgage direct debits. This is what they did to me! So you will need to move your current account to BOI or AIB and then just walk into a branch of Ulster Bank once a month and pay the mortgage amounts that you have opted to pay in cash to the teller.

I think you really have to ask yourself is the situation sustainable in the long term. Not only in terms of financial expression, but also in terms of the impact this situation has on your well being and ultimately that of your wife and young family.

I would think this type of situation is hopefully going to be addressed when the Personal Insolvency Agreement comes into legislation.
 
Hi David

The Personal Insolvency Bill will be passed into law in the next few months.
We dont have enough information about your finances to say exactly how it will help your particular case but I believe it will.

Its good that you have gone through the MARP process as that is one of the conditions for seeking a solution under the new Personal Insolvency Bill.

I would encourage you to continue to pay the interest only on your PPR in the meantime. If you need to default on any of the repayments, it might be better to "go bad" on the non-tracker investment property.

My feeling is that your overall objective should be to get rid of at least one, if not both of the investment properties and seek to retain your PPR.

If you decide to seek a solution through the Personal Insovency Act in a few months time, you will need to appoint a Personal Insolvency Practitioner to negotiate a settlement with your creditors on your behalf
 
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