A bank can be forced to allow the sale of a home

A

AnthonyJoyce

Registered User
Messages
2
Dear Brendan,

We are working with clients who are in severe negative equity, in arrears and realise that their mortgage is unsustainable. The most common example would be a couple who bought their house in 2006 / 2007 have split up and the bank simply will not deal with them. The mortgage is not being paid and interest is mounting.

We arrange (through an auctioneer) for the property to be sold at the best price possible and request the bank to provide their consent to the sale of the property in order to mitigate our clients losses. In certain situations the bank have not consented to the sale and we have applied to the Court for an Order for Sale of the property. We have brought 4 different banks to Court so far and they realise that their position of not consenting to the sale is not as definite as they believed. This is a shock to the bank officials!

The client is aware that the remaining balance is an unsecured loan and it is likely that they will have to avail of the proposed insolvency legislation when it is enacted. The bank may have to initiate debt recovery Proceedings for the balance. This is when the bank may begin to negotiate a settlement with the client rather than getting nothing in a bankruptcy.

There are many estate agents / auctioneers who are aware that this is happening and are working with us.

We effectively are handing the keys back to the bank in a structured and controlled way for our clients. We can then guide our clients through the various options available to them when the debt is unsecured.

Anthony
 
we have applied to the Court for an Order for Sale
Click to expand...

Hi Anthony

That is very interesting.

From what you say, it seems that the lenders agree to the sale before going to the court. But, if they refuse, and you end up in court, on what basis do you apply for an order for sale? I presume that the judge would refuse it as there would be no legal basis for it?

Having said that, I agree with your strategy for those with unsustainable mortgages. Get an offer. Apply for consent to sell. If they don't agree, then the banks could be held liable for not mitigating their losses.

Brendan
 
"In certain situations the bank have not consented to the sale and we have applied to the Court for an Order for Sale of the property. We have brought 4 different banks to Court so far and they realise that their position of not consenting to the sale is not as definite as they believed. "

This is the bit I don't get.

By and large, consent to the sale, by the bank, is not the issue - it is a consent to release the mortgage from the title so that a new owner is not stuck with it. What powers does the High Court have to compel a bank to release the mortgage from the title unless they have been paid in full?

mf
 
mf1 said:
By and large, consent to the sale, by the bank, is not the issue - it is a consent to release the mortgage from the title so that a new owner is not stuck with it. What powers does the High Court have to compel a bank to release the mortgage from the title unless they have been paid in full?
Click to expand...

Anthony Joyce did not say there had been an actual court order. It looks like the banks agreed to release the mortgage so the property could be sold, so the banks 'settled'.

Maybe in these 4 cases the banks agreed as they don't want the law tested. Or the court cases made the banks see sense.
 
I note from your post that you have 4 such cases.

Can you confirm if you have completed any house sales for clients in negative equity?

I understand that you are in the process of going through the courts but have you actually completed a sale of a negative equity property?
 
You must log in or register to reply here.
Back
Top