Can't switch from a vulture fund despite meeting BPFI criteria

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Lostinfin

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I am currently trying to switch from a vulture fund to a main bank. I had 26 missed months in arrears ~€50k. I cleared my arrears in December 2021. I haven't missed a full repayment since 2015. My mortgage is €208k. My home is worth €320k. I've a full time state job paying €76k. No other loans or risky activities.
Bank are querying my arrears and it seems they are going to turn my application down.
My current interest rate with vulture is 7.7%.
 
How are you dealing with the banks - directly or via a broker?

Your arrears are less than 2 years old. I think you should definitely have waited until at least the two years were up.

Brendan
 
Hi Brendan,
Thanks for the reply. I only applied in November, knowing that any application takes 2-3 months to get over the finish line. In two weeks, my arrears will be two years old. Perhaps I should have waited the month, but I'm very anxious to switch as it's costing me nearly €6k extra a year and putting me under huge strain.
I applied directly with my bank. They seemed like they were turning my down as a result of my arrears in 2019, so I have sent him a link to the new guidelines last night. The person dealing with me is going to discuss this with his supervisor. I am confident that I meet the initial criteria outlined by the BPFI. I am also going to try to apply through some online comparison sites. I'm happy to take any advice.
Thanks again,
Kevin
 
Response from Bank today to my mortgage application:

I have followed up with my supervisor regarding the link provided.They have advised, unfortunately, it would not apply to this application.This means the missed payments would still impact the request.

The guidelines don't apply to me even though I meet each of the criteria.
 
Hi Kevin

Those guidelines are meaningless.

The say "anyone who is making two years' full repayments may apply for a mortgage". All that means is "if you don't have two years' full repayment, don't apply". But it does not mean that you will get a mortgage if you do have the two years.

Brendan
 
It would be helpful if you gave more information.
1) Which bank did you take out your mortgage with originally?
2) Which vulture fund are you with?
3) When was it sold?
4) Why was it sold?
5) Give an account of the arrears history
6) How much is your mortgage?
7) How much is your house worth?
8) What is your income?
 
It might also help if you gave your age. So to understand the repayment term available that might be available to you. Depending on the bank some will let you go to 70 if evidence of a pension. You mentioned you are a state employee, so this shouldn’t be an issue.
 
I am 47 and in full time employment.
1) Which bank did you take out your mortgage with originally? PTSB
2) Which vulture fund are you with? Start
3) When was it sold? 2019
4) Why was it sold? 26 missed payments amounting to €51k in arrears.
5) Give an account of the arrears history: I left Ireland in 2009, and the arrears were caused by a mixture of bad tenants and my own poor financial situation. Financially, things improved in 2014 and in 2016, I thought I entered capitalisation agreement, but I failed to sign it. I was living in Asia, and had requested email correspondence. The contract was sent to my mother's house. I had been in regular contact with a bank employee prior to this viacemail. I should have done better with managing correspondence, but I thought he'd have been in touch via email if I had to sign something.
I now haven't missed any mortgage repayments since Jan 2015. I moved home in 2018, and my financial situation has remain relatively strong. I paid off all arrears by mid December 2021, and paid a further 10k off capital at that time.
6) How much is your mortgage? €208k
7) How much is your house worth? ~€320k
8) What is your income? €77k basic with extra €5k from other jobs.
 
It's a tough one.

From a bank's point of view, they are powerless if someone moves overseas and does not deal with arrears.

The borrower knows that they have an arrears problem but does not address it. "The dog ate my homework" excuses just don't wash.

BoI will lend to people who are 2 years free of arrears who engaged constructively with their lender. But I don't think you would be classified as having engages constructively with your lender.

Having missed no repayment since 2015 is good but why did you not make sure that your arrears had been capitalised?

You should approach a mortgage broker but it will be a tough sell.

Brendan
 
Hi Brendan,
I honestly thought that I had an agreement in place, but I agree that was my responsibility to follow up on.

As an aside, I also was extremely unhappy with the bank after I was moved off my tracker, after opting for a fixed rate back in 2011, but that's for another thread! This did cloud my judgement somewhat regarding engaging with the bank.

I am trying a few brokers, so I'll see what they say.

Kevin
 
Lostinfin said:
Hi Brendan,
I honestly thought that I had an agreement in place, but I agree that was my responsibility to follow up on.

As an aside, I also was extremely unhappy with the bank after I was moved off my tracker, after opting for a fixed rate back in 2011, but that's for another thread! This did cloud my judgement somewhat regarding engaging with the bank.

I am trying a few brokers, so I'll see what they say.

Kevin
Click to expand...
You are wasting your time with mainstream banks and other financial institutions. You might have a chance after 4/5 years.



If Credit Union says No then you have to wait unfortunately
 
Thanks Raging,
The local credit unions won't entertain anyone (me) with less than 5 years cleared arrears. I've asked.
 
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