Irish Times mention Irish Mortgage Brokers, 9th May 2017

We were mentioned by the Irish Times in a piece about mortgage arrears. It was in conjunction with a talk given to the Housing Agency on mortgage arrears. It quoted part of the talk we gave…

Financial adviser Karl Deeter told the conference his research puts the non-engagement rate at closer to 80 per cent.

Mr Deeter said the courts are “predisposed” towards borrowers, and that people are given many chances before they lose their homes.

“There’s three magic rules if you want to lose your home: pay zero for a long period of time, don’t engage with your lender – and then don’t show up to court,” he said.

“These three inputs were central to virtually every case of possession we saw.”

Mr Deeter said that according to his research, more than 90 per cent of distressed borrowers who engaged with their lender were able to work out some sort of deal to avoid repossession.

 

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Repossession statistics in Ireland, consider the numbers

With the new report on repossessions out it is probably a good idea to look at some of the actual statistics. Many commentators mistakenly describe property that isn’t taken back through repossessions as a ‘repossession’ when it is more in line with liquidated damages.

A repossession by definition is a seizure of collateral securing a loan in default, in most jurisdictions this comes with a court order allowing the lien holder to reclaim the property. In a ‘voluntary surrender’ that isn’t seizure process, and in an abandonment it is also about limiting the value reduction of idle property, for that reason we break the figures down into court ordered possessions and those that are done by choice or by leaving them without notifying the lender.

Here’s what it looks like.

And what you can see is that the orange bar which is the abandonments and voluntary surrenders far outweigh the blue bars which are the ‘repossessions’ where somebody is being brought through the process in court.

The non-court repossessions …

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Davenport after Dark on Newstalk: Karl Deeter on mortgage repossessions 1st August 2013

We were asked to speak to Fionn Davenport & Kieran Cuddihy on Davenport After Dark about the changes in the Land Conveyance Law Reform Act 2013 which may result in more repossessions in the future, we agree with this view, the question is what [glossary id=’6898′ slug=’mortgage’ /] holders will be targeted first?

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Actual repossessions versus perceived repossessions

If you were to read the headlines and not delve into the figures you’d be forgiven for thinking banks are either taking back houses wholesale or are about to. There will be a marked increase that is for certain, but have a look at some of the actual figures below.

This shows actual repossessions versus surrenders and abandonments. It’s clear to see that jingle mail and people giving back properties voluntarily is far greater than those being ‘turfed out’. The ratio is generally more than 2:1 against repossessions.

Some of these properties are being sold at a loss, some have equity, others are owned by people who just leave the country, the main thing to consider though, is that for the 95,000 loans more than 3 months behind (the topline figure of almost 150,000 ‘in stress’ is a little misleading) only 200 were taken back without consent in 2012.

That’s a mere 0.2% of the loans in arrears, and it’s still a nearly insignificant 0.85% of …

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Mortgage Arrears for the first half of 2010

We expected a 10% increase in mortgage arrears for the first half of this year, moving the total from 32,321 households to 35,531, however it increased 10.73% and the final figure was  36,438 [statistics for the last four quarters are below].

There is an ongoing inability for banks to deal effectively with people in arrears, both in terms of having the operational capacity or liquidity to offer debt relief in some form, and on the other side we have the Financial Regulator who is incrementally stripping away their power to enforce the mortgage via repossessions.

The arrears of the second half 2010 will go up again, there is no sign of either a slowing growth in arrears, or of a slow down in the rate of growth.

The only growth area in our economy at present seems to be in the deterioration of debt quality . . . but for the second half of the year it will not only be an ‘unemployment’ lead increase, rather it will be with the additional impact of lenders creating the problem via mortgage …

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When the truth comes out about arrears.

I often try to focus on ‘what is’ rather than ‘what is right’ (and sometimes still get it wrong!), but the idea is to look at something from as objective a standpoint as possible. I’ll take the National Geographic for instance (stick with me on this!), if you watch it objectively and see a lion kill a gazelle you realise that it is nature, the gazelle didn’t want to be torn apart, equally the lion doesn’t want to starve to death and if you accept that lions killing gazelles is a perfectly natural thing then you are seeing what ‘is’. On the other hand if you watch the same scene but the build up to it was following the life of that particular gazelle from birth and its a Bambi story then the killing scene becomes a sickening tragedy.

That is the difference sometimes between looking at what is ‘just’ or ‘right’ and what merely ‘is’, I don’t know about you but I certainly struggle with that at times. It is …

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Jingle Mail, Jangle Mail, or 'Voluntary Possession'.

I had the honour of being a speaker at a MABS seminar on the 21st of May, it was called ‘Keeping a roof over your head’ and it was focused on the issue of housing, and in particular that of the collections/repossession process of Irish Banks. One of the speakers was a solicitor named Colin Daly of the Northside Community Law Centre. He spoke about ‘Voluntary Possession’ which is the process of coming to an agreement with a lender whereby they take your house with your consent (you are not getting thrown out), it isn’t the legal terminology for ‘jingle mail’, ‘jangle mail’ or ‘sending the keys to the bank’ which is a totally different matter, it was a fascinating insight into the process and it is good to know that there are resources such as the NCLC out there for people in difficulty who need legal advice.

There was some information …

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Jingle Mail, Jangle Mail, or ‘Voluntary Possession’.

I had the honour of being a speaker at a MABS seminar on the 21st of May, it was called ‘Keeping a roof over your head’ and it was focused on the issue of housing, and in particular that of the collections/repossession process of Irish Banks. One of the speakers was a solicitor named Colin Daly of the Northside Community Law Centre. He spoke about ‘Voluntary Possession’ which is the process of coming to an agreement with a lender whereby they take your house with your consent (you are not getting thrown out), it isn’t the legal terminology for ‘jingle mail’, ‘jangle mail’ or ‘sending the keys to the bank’ which is a totally different matter, it was a fascinating insight into the process and it is good to know that there are resources such as the NCLC out there for people in difficulty who need legal advice.

There was some information …

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Housing dysfunction

There are some who are saying that there are amazing deals to be found in the current market and if you consider price only then you may be tempted to believe this. Yields could also present a strong argument for property investment if yields stay at historic levels, however yields are likely to fall in 2009 and will remain stagnant until at least 2011/12 for several reasons which we will outline, we will also look at some of the current dysfunction in the market by examining a few types of sellers and how their personal situations express themselves in their selling behaviour.

The first group bought in the last days of the boom, they likely used minimal deposits (or even 100% finance) in order to purchase and they are in deep negative equity, they are now no longer on fixed rates – which tended to be 1/2/3yr fixed- and may have moved into the variable market which revises their payments upwards. One can be forgiven for thinking they may be a ‘distressed seller’ – the distress …

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