The hard facts

[Stars and Moon]

Hi, I came across your forum in my days of searching for hard facts on mortgage defaulting in the Republic of Ireland and really hope you can help us.

 

We just moved to the States due to my husbands job transfer. We have a house in Ireland, a loan and a maxed out credit card. With all that plus rent over here and living expenses we are drowning. We have been talking to the bank, have requested a payment break (no word back yet) and have asked if we could sell at a loss and make payments on the balance remaining but were told that any remaining balance would have to be paid as a lump sum We do have a renter in place but even with that help toward the mortgage payments we just cant keep up. The exchange rate alone is killing us, never mind the regular payments.

 

I am trying to find out the hard facts about what the consequences would be of our just handing the keys to the bank and saying "Here you go, its all yours!"

 

Its an extreme step but my husbands health is starting to be affected by the stress of it all so something has to be sorted.

 

Can any of you either tell me or point me in the direction to go to get the information I need?

 

Thanks so much,

Stars and Moon

[enoughisenough]

NEVER think for ONE MOMENT you are free when you HAND BACK the keys. You will be HOUNDED for YEARS.

[mjc007.5]

Hi,

 

Family experience here, just to reinforce the post from enoughisenough. My parents handed back their keys when the property market last fell through the floor in I think it was the early 1990s (this also co-incided with significant health problems). My father is fairly savvy in these things and has them under control in terms of affordable payments but they are STILL paying the shortfall now!

 

I do realise (not in same boat myself with house but unsecured creditors are getting very heavy handed) that the stress involved is such that handing back the keys might appear the best option. My understanding (and this may be corrected) is that the statute of limitations is six years for some debts but for mortgage related it might be up to as much as twelve?? (this may have changed, others more wise will let you know I am sure). You can hope they muck it up and do not pursue you within these time frames (we know of someone who was lucky enough for this to happen and it was written off!) but this I think fairly rare (and fortunate!!). If at all possible (and I realise a big if) would seem best to come to some form of arrangement with the mortgage company BUT ultimately as I am learning from the good people here health does in fact have to come first!

 

Best of luck with it all, hope things work out for you

[Stars and Moon]

Having spent the day searching for more info have to say I have still drawn a blank. Still cant find anything reliable about how long a default lasts till being cleared from your credit.

 

Looked into switching to interest only payments but at the moment what we are paying is mostly interest anyway so a savings of 20% wouldnt help enough to try for.

 

Funny, its not that comforting to know we are in the same boat as so many other people lol

[mjc007.5]

Hiya - believe default would be same as CCJ (six years) on credit file. Again offered as helpful amateur, others will correct me if I am wrong! If not moving to interest only could you extend the term? Some mortgage providers will let you go up to 40 years (as long as you are under retirement age). Long term I realise not ideal but short term might help more?

 

Might be worth re-visiting the request to payback the deficit in instalements - if you make them a fairly substantial offer they may accept? Possible alternative request they allow a grace period of accepting just the rent from your tenant and manage the arrears onto the the back end of the mortgage (kind of combining extending with the tenants rent).

 

Know what you mean about not getting huge comfort from so many folks in the same boat. They are so helpful and supportive here but ultimately the leg work is with us each individually and this can be so very difficult. Hang in there though because as well as excellent advice there are many successful tales - it can certainly be done!!

[Mephistopheles]

Having spent the day searching for more info have to say I have still drawn a blank. Still cant find anything reliable about how long a default lasts till being cleared from your credit.

 

Looked into switching to interest only payments but at the moment what we are paying is mostly interest anyway so a savings of 20% wouldnt help enough to try for.

 

Funny, its not that comforting to know we are in the same boat as so many other people lol

 

A default effects your credit rating for six years, unfortunately if you hand in the keys this is called voluntary repossession and this can actually last longer.

 

Even if it was just the default, you would be liable for any shortfall or the balance of the debt and provided they contacted you for payment then it never expires. Only if there is no contact does the statute of limitations apply.

 

Meph

[Stars and Moon]

Thanks for all your replies, I will keep plugging away with the effort and see where we get to