Posts Tagged ‘Negative Equity’
A frequently asked question that we’ve been receiving recently has been “My Foreign Loan has been sold – Help!”
As we come out of Covid-19, Banks worldwide are looking to tidy up their acts. This usually takes the form of:
- Writing off bad or delinquent debt,
- Pressurising those struggling to maintain payments, and
- The worst of all – selling their loans to Vulture Funds.
When Banks start to struggle, they look to take the pain of quickly writing off what they see as ‘bad debts’ and then look to ‘cash out’.
By ‘cash out’ we mean to sell these loans at a discount. That then frees up capital funds and for them, they do not have to manage delinquent accounts.
This ‘hassle’ factor has become more prevalent for our dear foreign banks over time and with this recession, we believe, and we are hearing such Loan Sales are and will become more prevalent going forward.
The purchases of such loans are usually referred to as ‘Vulture Funds’ and their key characteristics and agendas are best summarised by the following facts:
- They are usually International Funds, Hedge or Venture Capital in nature,
- Unlike the European Banks, they are strong in their approach to cross-jurisdictional issues and collection of debts,
- They are looking for short term successors/cash flow from the portfolio they purchase from the Banks,
- In the main, they are not long-term lenders, and most importantly, and
- They are far more aggressive in their recovery approach, wanting their ‘pounds of flesh’.
A ‘long story short’ – Vulture Funds will:
- Be in it for the short term,
- Be legally aggressive with non-payers,
- Chase across borders more efficiently than the Banks, and
- Look to recover every €/£ they are owed.
We have several cases which saw us start our work with a Bank but they, in turn, sold that on to a ‘Vulture Fund’. That then requires us to pivot in terms of attitude, stance, and most importantly the strategy for our client.
If your Spanish/Cypriot/Portuguese mortgage loan has been sold to a third party AKA Vulture Fund, it is vital that you know your options.
Our specialist team are here to provide you with a strategy to alleviate foreign property debt as a whole.
You can also head over and watch our latest YouTube video on Vulture Funds, click HERE.
Have you fallen behind on Community Fees & IBI Taxes? If so, read on!
EU Property Solutions assist people daily who have significant mortgage arrears and missed community fee payments. Many borrowers who purchased properties in Spain were not aware of costs such as Community Fees and IBI taxes. These additional costs and Mortgage Debt in Spain can result in significant stress.
Community fees are owed to Community Presidents in Spain. These Presidents are charged with ensuring the community in which you have purchased is visibly up to scratch – for example, the maintenance of common areas, swimming pool cleaning and general upkeep of grounds.
It is important for borrowers to keep up to date with these fees as debt collection can be instructed by Presidents in Spain to the UK and Irish Debt Collection Agents.
If you cannot pay your Spanish mortgage and fall into arrears, then your mortgage balance will increase.
Missed payments are added to the balance along with penalties and interest. Furthermore, you risk legal action and ultimately you are putting your home assets and income at risk if you do not act.
If you cannot maintain payments on your Spanish property, then swift action is needed. If you act quickly through an intermediary, such as EU Property Solutions, then the matter can be brought under control and an amicable and desirable outcome achieved.
In most Spanish settlements we can achieve:
- The surrender of the property to the Bank and a complete debt write off.
- We can even negotiate Community Fees arrears and IBI tax arrears into the settlement.
Visit our YouTube channel, we publish videos on a weekly basis. This week’s video sees our client, Sue Geraghty discuss the issues she was facing before appointing our services. CLICK HERE TO WATCH.
If you are struggling with any repayments on your Spanish Property call EU Property Solutions on 0330 124 1230 for a free case review.
Spanish Banks chasing debt in the UK
Since the financial crisis in 2008, Spain has seen well over a quarter of a million properties repossessed. A staggering figure! Spanish Banks chasing debt in the UK has increased.
A large proportion of these repossessions are foreign-owned properties.
EU Property Solutions find it incredible so many British and Irish borrowers feel they can merely “hand back the keys” and walk away from the property thinking they are somehow immune to any consequences once back home.
Many borrowers post their keys through a Bank or representing solicitors’ letterbox not fully aware of the consequences.
These debtors have the impression that Spanish creditors cannot pursue their home country assets. They also think that the Banks haven’t got the time or resources to pursue overseas.
Anyone who signs a mortgage deed in Spain, including guarantors, is personally liable for the loan.
Any legal action will likely be notified to the Spanish Address on which the mortgage has been placed.
Many overseas borrowers in Ireland and the UK will be unaware of any proceedings against them until the process is gathering apace.
In terms of debt perusal in the UK or Ireland, lenders can look to recover your home assets. Many lenders will appoint UK Debt Collection agents leading to an effect on your credit report.
The Spanish lender can look to put a charge on your property even if it already has an existing mortgage and can enforce an Attachment of Earnings Order.
Spanish lenders seem to be developing a greater appetite for overseas debt perusal.
EU Property Solutions can assist anyone in this situation so please contact the team today on 0330 1241230 to arrange a free initial consultation.