In the past few weeks, we have seen a large increase in enquiries especially from people who have a foreign mortgage, particularly in Cyprus and Spain. Many are concerned with some loan sales now being undertaken by Banks across Europe, as the Banks at last look to clear all problematic debt and tidy up their ‘books.’
Such problematic debt cases include:
- Those in arrears, be they slightly or massively in arrears,
- Unaffordable repayments brought about by mortgages going from the interest only form to repayment,
- Maintenance costs/ management charges, and
- Continuing negative equity.
Many people and their advisors are deluded if the think merely ignoring a foreign mortgage debt problem will see it go away. Yes – a lot of time has lapsed since the 2009 crash but like elephants, these Banks do not forget! Banks are still relatively civil in most instances as long as there is engagement in some form, but across the board – their patience is wearing thin. They are employing the following approaches, to name but a few:
- Applying for European Enforcement Orders,
- Appointing strong legal firms to enforce in the UK,
- Making their own enquiries as the people’s worth/assets, and
- Most worryingly for our clients, the sale of loans to Vulture Funds…the name should be a clue as to how they conduct themselves…not so civil!
Foreign Banks in the main are still approachable. As ever it’s a case of the right type of engagement, usually undertaken by a trusted party.
We would say this any way, but you need someone like EU Property Solutions because:
- You need someone trusted by the Banks. They appreciate straight talking and know we perform on cases. We only act for the client, but know the different parameters that each and every Bank works within,
- Sometimes Banks are not fully truthful. EU Property Solutions cut through and call out any discrepancies from any financial institution, and
- Even though we are looking to alleviate the problem here, Banks and their advisors need to be driven.
Some people believe that this ability to chase foreign debt in the UK, as provided for under Cross Border Claims EC 44/2001, will diminish with Brexit. We definitely do not see this as the case because the EU will still be our main trading partner and such provisions ensure safer trade conditions for all.
Under existing EU law anyone, including Bank’s and any other foreign trading entity can secure a Judgement in their country and then bring this to the UK and apply for a European Enforcement Order.
This Order when granted, and they usually are, enables the creditor to pursue clients here in the UK, which can, in turn, see UK assets such as homes, businesses and in some instances pensions, come under threat. The legal costs in such recovery actions can be horrific and payable by the debtor as well.
As ever we use the mantra of #KnowtheWorstAchievetheBest.
Definitive advice is imperative. Relying on uninformed opinions is no good to those facing this sort of situation. Relying on ‘bar room’ legal opinions is dangerous – especially when whilst these opinions that may suit your arguments, are wrong.
In conclusion if you face foreign mortgage problems, get the best advice you can. If it goes wrong then you will definitely be pursued at some time. Ignoring the issues is not sensible – to say the least.