The involvement of Vulture Funds in holiday home mortgages particularly in Spain and Cyprus, is a continuingly worrying development.
Loan Sales have gone on forever on all financial products including credit cards and alike. Even in the demise of Wonga, the personal loan company, the loan book was ultimately sold.
We at EU Property Solutions and our sister company Bell & Company deal with over 400 cases, and most of these are deemed to be delinquent debt (otherwise known as non-performing loans).
Very often these delinquent debts, weigh down Banks and affects their own financial operation. So, if debts, or a certain type of debt are non-performing they look to dispose of these. Meaning they ‘take the hit’ on their profits, sell them, and move on using the new funds to create more business for themselves.
Vulture Funds are typically established by international Hedge Funds or Venture Capital groups and are usually worldwide entities. This gives them the ability to extend their ‘tentacles’ into every market in the world.
Names to look out for are:
Be under no illusions. Vulture Funds are very efficient and strong at the recovery of any debt they purchase and therefore own the rights to. They pay a discounted amount to the Banks and financial institutions on holiday home mortgages and look to maximise their profit by recovering as much as they can of the book debts against what they paid for it.
Many people ask us what the Bank paid for the debt but there is no way of finding out on two main reasons:
As mentioned above, they are very efficient and far more intellectual in their approach than the foreign Banks in Cyprus or Spain. Thus, their ability to recover greater returns on these loans. As we said, they are usually worldwide entities, and consequently have strong cross jurisdictional legal skills, and know how to chase debt in any market.
When considering their approach to the UK and Republic of Ireland typically they sit back and watch assets in those countries rise, e.g., on your home, since 2008. In simple terms, those assets have increased in equity, and that is the target for Vulture Funds.
Once they have established their rights in respect of the debt they will write and demand full payment. If this is in anyway ignored, then they will pass this on to very efficient large litigation firms to chase down this debt.
The operation is frighteningly efficient and ruthless. If you own assets, even in illiquid form such as your home….. one way or another they are going to go after it, and they will get it, if you do not engage correctly with them.
As ever it is vital to get the right advice (EU Property Solutions!) and attack the problem. Leaving it or ignoring it will do two things:
These large litigation firms, acting for Vulture Funds, charge ‘like a herd of buffalos’, and the cost can sometimes seem crazy. These costs are then are not up for discussion, particularly if you have ignored the process and their submissions to you.
We don’t mean to sound negative, however this is a very worrying development and will extend even further into the holiday home mortgage market. We have even witnessed in Cyprus, Spain and Republic of Ireland, that Banks are now selling performing loans i.e. the mortgage has been paid up to date, but the Banks want to release cash from such books.
As ever, it’s good to talk, so call us if you fear this could affect you or if your mortgage/loan has been sold on.
It is free to talk to us, so please contact us now.
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We are a UK based firm with legal teams in Spain and Cyprus who understand the market and Bank practices as they stand. We remove the language barrier and utilise law, Bank lending flaws and current client circumstances to negotiate the best feasible outcome for all our clients.
EU Property Solutions was formed following the success of our associate firm Bell & Company. An FCA registered firm of Debt Strategists, Bell & Company assist individuals in difficulty in the UK and Republic of Ireland with Personal and Business-related debt issues.
We have an excellent track record of success. Our success stories and testimonials come straight from our clients & highlight the high quality of our works and outcomes. We have individuals willing to speak to prospective clients on the telephone to offer their story and experience.
Our obligation is always to our client and that is where our strength lies. Debt is highly stressful and emotional. We deal with debt day in day out and employing an intermediary removes emotion from the situation allowing clear strategy to be implemented to get the best outcome for our clients. Understanding a firm of professionals is acting on your behalf can remove stress and focus the mind to a positive end goal.