Revenue Judgement Mortgage on family home

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FPren2022

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Hi All

Looking for guidance, my mother's home is registered in her own name. She lost her business in 2014 and Revenue lodged 3 Judgements on her family home mortgage (2017). Since then I went as co-mortgagee on her bank mortgage to assist her paying it off. She still has 8 years left on this mortgage.

I'm looking to move in with mother to help her out with bills etc. and look after her and sell my own house (separate to my mother's property) on which I will make little profit after CGT.

As far as I'm aware interest and penalties accrue on each of these (3) Judgement Mortgages as the years pass by so paying off the Revenue debt is not a possibility in my mother's lifetime. I've also been told that the debt is on the property (against my mother) so if my mother's passes away, the debt remain on the house.

My questions are as follows:

  1. If my mother passes away and the house is left to me, can the Revenue enforce the sale of the family home while I reside there?
  2. Is it likely that Revenue will come after my mother and enforce the sale while she is alive?
  3. If my mother transfers the house into my name, can Revenue come after my personal savings (i.e. circa 20k profit from sale of my own property) as I would be registered on the property and the debt is on the property i.e. my mother's house?

My issue is that if I sell my own property and then Revenue enforce the sale of my mother's house to claim their debt, I will be left homeless with no option to buy anything with what would be left over.

All and any help/suggestions are welcome - has anyone been in a similar situation? I'm quite confused with what to do at this point.

Thanks,
 
FPren2022 said:
Looking for guidance, my mother's home is registered in her own name. She lost her business in 2014 and Revenue lodged 3 Judgements on her family home mortgage (2017). Since then I went as co-mortgagee on her bank mortgage to assist her paying it off. She still has 8 years left on this mortgage.
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Could you give us the numbers here.
How much is the family home worth?
What is the balance on the bank mortgage?
What is the total amount of the Revenue judgements?
 
FPren2022 said:
If my mother passes away and the house is left to me, can the Revenue enforce the sale of the family home while I reside there?
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I am not a lawyer.

The Executor cannot put the house in your name without clearing the mortgages first.

So the Executor would have to sell the house and repay the mortgages.
 
FPren2022 said:
I'm looking to move in with mother to help her out with bills etc. and look after her and sell my own house (separate to my mother's property) on which I will make little profit after CGT.
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Without knowing the numbers it's hard to comment on this.

You can move in with your mother and let your house to a tenant?
That way if things don't work out with your mother or when she dies, the mortgage is not cleared, you will always have your own home to move back into.

Is there an option to sell your mother's home and for her to move in with you?
 
Does the mortgage have a life mortgage protection policy? That might clear the mortgage if she dies.

Having said that, the executor cannot transfer the house if the revenue claim is still active either. All liens would have to be cleared for title to be transferred.

If your mother's equity in the house is high enough, you could probably get a mortgage to clear the other mortgage and the revenue judgement.

You may be able to "take over" your mother's mortgage and increase the mortgage by the 50k.

That would depend on loan to value amounts.
 
Hi All,
Thanks for your help on this. The judgements in total are about 103k before penalties. Mum's house worth about 400k with 35k left on the Mortgage. My own house is valued at 300k with a mortgage of 250k left
 
So your mother's equity is €250k approx (400k - 103 - 35)

You have a mortgage of €250k!

You could sell your own home and buy your mother's home with a mortgage and clear the other mortgages.

But I would see no reason to do this. It appears that the interest on the Revenue judgements is 2% a year, which is cheaper than any mortgage you could get.

So move in with your mother.
Rent out your own home.
Pay down both mortgages over time.
If house prices stay the same, the equity will be increasing.

Then when your mother dies, decide what to do.
 
Brendan Burgess said:
It appears that the interest on the Revenue judgements is 2% a year,
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Seems to be alright:


17.6 The rate of Interest on Judgments has been reduced from 8% to 2%, with effect from 1 January 2017, pursuant to the Courts Act 1981 Order 2016 (Interest on Judgment Debts). This will affect the amount payable by a debtor on a Judgment debt when for example, a Judgment Mortgage has been registered and the debtor wishes to have the Mortgage discharged. In these cases, interest on the Judgment sum from the date of Judgment up to the date of payment is payable by the debtor and this interest amount is calculated at the reduced rate of 2% with effect from 1 January 2017. As the Order came into being on 1st January 2017, interest up to that date is charged at the old rate of 8% and at 2% from 1st January 2017 onwards
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Thanks Brendan, Are revenue likely to put another judgement on the house when this one runs out. I'm told it's out in 2029 (after 12 years) but they can apply for another one before this time. Would they be likely to do this?
 
Your mother owes the money to Revenue which acts on behalf of the citizens. She should arrange to pay it and not to be looking for a way to avoid paying it.
 
FPren2022 said:
I'm told it's out in 2029 (after 12 years) but they can apply for another one before this time
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Presumably, that means that your mother has to pay it in 2029? If they lose the money if they don't renew it, then obviously they will renew it.
 
She can't pay it, that is the issue. She's a 73 year old pensioner with no savings at all. All she has is the house and she's very worried and I just don't know where she stands. Looks like they'll put the judgement back on the house in 29.When the mortgage is cleared can they force her to sell then? Do they wait it out until she dies and force me to sell then? Eventhough it may be my family home at that time if I move in with her?
 
OP I think you need to look at it like this. Right now, Revenue, the bank and your mother own the home in different % shares. It is a difficult situation but it will help give you clarity on how to proceed.
 
Folks, ClubMan posted this link earlier, with a recommendation that it be read:

Judgement Mortgage : Revenue

Hi, all. New here so if I am on the wrong thread, please let me know. I did a search re : Judgment Mortgages but nothing relating to my query popped up. So here goes. On the 13/10/2011, Revenue received a judgment against me for non-payment of VAT. The original hearing had been adjourned due my...
www.askaboutmoney.com

In it, Jim Stafford says that a Revenue Judgment Mortgage lasts for 30 years.

To give the OP's mother, and the OP, best peace of mind, Brendan's suggestion is the best:

OP sells her own house.
OP takes out a mortgage to buy her mother's house.
As part the transaction, the mother's mortgage is redeemed, and the Revenue is paid in full.
OP moves in with mother.
 
FPren2022 said:
She can't pay it, that is the issue. She's a 73 year old pensioner with no savings at all. All she has is the house and she's very worried and I just don't know where she stands. Looks like they'll put the judgement back on the house in 29.When the mortgage is cleared can they force her to sell then? Do they wait it out until she dies and force me to sell then? Eventhough it may be my family home at that time if I move in with her?
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Revenue don't need to force a sale, which they are not going to do, revenue is Time, they wait. They will get their money when she dies. So she should not be worried. And you should be reassuring her not to worry. Revenue probably do not know when the mortgage ends. But they do know about time.

If you inherit the house, it's not a question of you being 'forced' to sell. You'll acquire an asset which has a debt attached. Your mother's estate pays the debts, including the revenue debt of the judgement mortgage.

Why has your own home so little equity? When did you purchase?

It is not clear why you went as co-mortgagee on your mother's property. Which, oddly, occurred after the revenue judgment mortgage. Can you explain properly your scenario. We do understand you're trying to minimise tax. But you're not helping by being so opaque on detail.
 
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