A SOLICITOR who helped his clients to negotiate a reduction in their mortgage of more than €200,000 says he has a further “20 to 30 similar cases working their way through the system”.
Anthony Joyce was speaking after it emerged that a Dublin couple secured a reduction in their mortgage debt to Stepstone Mortgages from €360,000 to €154,950 in November last year.
The couple lost their home as part of the process, but have been able to rid themselves of the huge debt they could not repay. Mr Joyce said banks were proving increasingly “practical and willing to work with customers who are financially devastated”.
The couple at the centre of the Stepstone Mortgages case had been unable to keep up repayments and were seeking to hand back the keys of their property.
The mortgage company wrote to them saying that if they did this, they would remain liable for the balance of the outstanding mortgage and would be pursued for it.
“I advised them not to sign the letter, to liaise with an estate agent and get a buyer,” said Mr Joyce.
“So we put it on the market for less than properties were going for in the area and got a buyer pretty quickly. We then went to the bank and made them the offer of taking the money now or they would have to repossess it, put it on the market themselves and wait maybe six months to a year to get a buyer and probably get less for it than we were offering.”
Stepstone Mortgages, he said, accepted €154,950 as full payment for the debt. A spokesman for Stepstone declined to comment, citing client confidentiality.
Mr Joyce said: “I don’t think it’s going to open the way for widespread mortgage debt forgiveness. It’s just not practical.
“For that to happen the banks and the Government would have to come together and, in effect, it would be like the situation with Greece on a micro level.
“But I do think the banks are being practical and recognising that when people are financially devastated, they have probably got as much as they are going to get out of them and this is the practical way to deal with these cases.”
Mr Joyce said that in cases where people “are sick and tired of not being able to sleep at night and just want to walk away from their property”, he advised them to put their properties on the market and to ask the bank to accept the price they got.
Asked if the strategy affected his clients’ credit rating, he said it was “already in tatters . . . They will probably never get a mortgage again, but it means they can begin to get on with their lives.”
