‘Judgements In Favour Of Vulture Funds Will Explode In 2017’

at

screen-shot-2017-01-10-at-09-19-11

screen-shot-2017-01-10-at-09-46-45

screen-shot-2017-01-10-at-09-48-11

Members of the anti-eviction group Plataforma de Afectados por la Hipoteca (PAH) in Spain; Niamh McDonald, of the Irish Housing Network, and Dr Padraic Kenna of NUI Galway

Last night.

RTÉ One broadcast a documentary by Sunday Business Post editor Ian Kehoe, called The Great Irish Sell Off.

It examined how vulture funds have bought close to €200 billion in distressed Irish debt  – while paying minuscule amounts of tax on the profits – and looked at the on-going consequences of these purchases, given that vulture funds have bought almost 90,000 mortgages in Ireland.

For the documentary, Mr Kehoe travelled to both the US and Spain to see how the same vulture funds operate there.

In Barcelona, Spain – which has seen Blackstone buy 40,000 mortgages from a bailed-out bank while vulture funds Goldman Sachs, Cerberus and Oaktree manage around 150,000 mortgages – Mr Kehoe met with members of the Plataforma de Afectados por la Hipoteca (PAH).

PAH is a grassroots organisation that is campaigning for housing rights and attempting to prevent evictions by occupying homes that are in the process of being repossessed.

Mr Kehoe reported that PAH has prevented thousands of evictions.

As he sat in on one meeting, Mr Kehoe realised 14 Irish people were there, including Niamh McDonald, of the Irish Housing Network, who has also been involved in the recent Home Sweet Home campaign, and Dr Padraic Kenna, a lecturer in property and housing law at NUI Galway.

Ms McDonald told Mr Kehoe:

“In Ireland, people seem to be embarrassed to turn around and say that they can’t afford to pay their mortgage or they can’t afford to pay heir rent and I think that helps the banks in many ways. But if we had a movement that would kind of encourage people not to feel ashamed, then I think people will start to fight back.”

Dr Kenna said:

“People, in fact, are leading the politicians with the solutions here [in Spain]. For instance, they have a law where a family or the administration can buy a property at the same price as a vulture fund. Now that’s something that we could seriously consider.”

Meanwhile…

Following the documentary, RTE’s Claire Byrne Live held a discussion about the programme with panelists Fine Gael TD and Minister of State for Financial Services, eGovernment and Public Procurement Eoghan Murphy, Sinn Féin TD Pearse Doherty and Ross Maguire, a senior counsel and chairman of New Beginning.

Members of the audience also contributed, including James Treacy, the chief executive of Stubbs Gazette.

screen-shot-2017-01-10-at-10-06-20

Mr Treacy, above, said:

“I was very surprised that, in 2016,  there were actually only 4 registered judgements awarded in favour of the vulture funds. Now, at Stubbs Gazette, we believe that that figure is going to explode in the next 12 months and there’s a number of reasons for that.”

“The first reason would be that I think that there’s currently about 250 cases currently with the courts that have not been adjudicated on so a significant proportion of those will end up with judgements and secondly, and more importantly, is that the Central Bank have brought out figures that show that 38% of all of the mortgages that are owned by the regulated bodies are over 720 days are in arrears.”

“Now, depending on who you believe, or what you read, there are between 45,000 and 90,000 mortgages that are currently owned by the [vulture] funds. So, whichever way you look at it, there are tens of thousands of these mortgages in serious arrears.”

Watch The Great Irish Sell Off here

Watch Claire Byrne Live here

Previously: Selling Ireland By The Pound

70 thoughts on “‘Judgements In Favour Of Vulture Funds Will Explode In 2017’

  1. Joe Small

    o if someone hasn’t paid their mortgage repayments in 2 years, what should happen? The banks already charge the remaining mortgage holders higher rates to offset these delinquent mortgages.

    1. Fact Checker

      Ireland has (more or less):

      A)
      -the highest level of mortgage arrears in the euro area – for example >14k BTL mortgages in arrears of 2 years or more
      -a legal system which (in effect) makes repossession very difficult – it seems about 5 years of non-payment
      -no new entrants to the mortgage market in ten years (in fact several exits)

      AND

      B)
      -the highest mortgage interest rates in the euro area

      I am happy for anyone to make a cogent case that there is no link between A) and B).

      1. Anne

        Make repossession easier is your solution..wonderful.

        Banks are very profitable..so there isn’t a link between a and b.
        Of course much wants more. How much profit do they need to make before mortgage interest rates are in line with other EU countries?

        It’s the same lark as the insurance companies blaming gouging on an increase in claims, when their profits are soaring.

        1. Fact Checker

          How long should a buy-to-let landlord be allowed to retain ownership when they have failed to make a mortgage payment? BTL landlords are profit-making capitalists just like vulture funds……

          PS: Irish banks are indeed profitable, except if you allow for 2009-13 when they were not, and exceptionally so.

          1. Anne

            The 90,000 mortgages the vultures have are not all buy to let homes.

            And it would make more sense for the state to take ownership of these BTL houses, than give massive write offs to vultures, as the taxpayer is on the hook when people are turfed out and have no where to go.

            I happen to think that the enriching of some international funds at the expense of Irish people needing a roof over their heads is not a society we should aim for.

          2. Anne

            Who should gets the write off is the question.

            You give massive write offs to vultures and turf people out of their homes, the taxpayer picks up the tab twice.. as people need to be housed. I don’t know which part of this equation yer not getting. People need homes.

            We don’t have big deserts filled with trailer parks in this country that we can hide people in.. unless you’d consider Ballybunion a viable option there.

        2. Owen C

          “Banks are very profitable..so there isn’t a link between a and b.”

          “It’s the same lark as the insurance companies blaming gouging on an increase in claims, when their profits are soaring.”

          I have a stack of company reports in front of me which not only beg to differ, but could be used as evidence that you were taking class A drugs when you made this comment

          1. Owen C

            Awesome, ill do my part and list the p/l for the previous years….

            2009 -2.41bn
            2010 -10.23bn (yes, 10 billion loss)
            2011 -2.31bn
            2012 -3.65bn
            2013 -1.687bn

          2. Old Vic

            Irrelevant Owen

            Those losses are all being offset now against current years profits. No one really loses except the Irish taxpayer or customer of public services who must go without to cover the banks profligacy

          3. Owen C

            Also, of the 11.3bn in bad loans still on AIB’s balance sheet, do you think they will make any losses on them above and beyond the provisions they already have in place?

      2. Joe Small

        There’s definitely a significant cost to the banks when people don’t/can’t pay their mortgages for a few years but still remain in the house. Banks certainly aren’t charities and are in the business of maximizing profits so its naïve to this that a and b aren’t related. I don’t think the comparison with the supposed links between insurance fraud & insurance premium levels is valid. Its widely known that insurance companies are compensating for lost investment income by raising their premiums.

  2. Daddy

    “hey have a law where a family or the administration can buy a property at the same price as a vulture fund. Now that’s something that we could seriously consider.”

    Most definitely. If Vulture Funds are being offered loans or property to buy at a price lower than other potential customers, that is most likely illegal under trade rules and EU consumer law. It is probably unconstitutional too.

    So Irish politicians, civil servants and banking executives have conspired to work with Vulture Funds at the expense of the wider interested market including individuals. That must be fraud. And you can be damn sure they didn’t do it without getting something in return which is a criminal offense.

    1. Joe Small

      I hope you have evidence of civil servants and others committing crimes. That’s a pretty serious and unsubstantiated allegation to make.

      1. Anomanomanom

        Yes of course, every thing mentioned on here is always backed up by evidence…. welcome to the internet.

    2. Frilly Keane

      There was definitely what would qualify as “insider” trading

      …. A finance provider asking its debtors to hold off petitioning for bankruptcy until they bundled off the loan agreements…..

    3. Sheik Yahbouti

      Daddy, I had a look at the movie “Cromwell” the other night. I saw it many years ago, and looked at it out of nostalgia as one of Harris’s few good roles. The instructive thing to note, however, was that a King of England was beheaded for “conspiring with foreign powers, against his own people”. When are the tumbrils going to roll for Noonan, Sutherland, Kenny et al?? Truly we are saps to hold still for this Treason.

        1. Anne

          Stop being so abusive.

          Mods can ye ban this whinger? He’s very upsetting to us decent contributors. He’s gonna drive us all away. Ah go on.

          1. Kieran NYC

            You are a thoroughly unpleasant person. You and the rest of your angry demented mob. The kind that resulted in Old Vic’s horrible comment about someone’s domestic abuse history last night.

            I hope you have a happy 2017, Anne.

          2. Anne

            KFC, one of these days you’ll develop a sense of humour.
            It’s all abuse, unless you’re dishing it out yourself.

            A happy 2017 to you too. Hopefully you’ll be less whingy, going forward.

          3. Old Vic

            Absolutely Anne

            This parish priest was sermonising about misandry here and whatnot the other night. Then he leaps to the defence of a serial woman-hater and “man” who had earlier compared Meryl Streep to Hitler because she called out Donald Trump for being a fraud. This notorious baby buttwipe cloth contributes absolutely nothing to threads here other than to disparage anyone who isn’t a little blue rinse neoliberal flunky like himself.

    4. Diddy

      Just one problem with that daddyo. People who bought overpriced housing and can’t pay get a write down. People who bought overpriced housing and are paying get no write down.

      1. Anne

        People have to live somewhere..if the suggestion is that in the middle of a housing crisis people wilfully aren’t bothered paying their mortgage, the taxpayer has to foot the bill either way as people have to live somewhere.

        1. Increasing Displacement

          Then they should be moved to a cheaper house that they can pay for.
          Not stay in the house they can’t pay for costing everyone including you and me money.

  3. Daddy

    Plenty of developers and their families have people working on their behalf in Nama. Everyone in the business knows it.

  4. DubLoony

    “they have a law where a family or the administration can buy a property at the same price as a vulture fund. Now that’s something that we could seriously consider.”

    Elegant solution.

    1. Fact Checker

      My mortgage is worth more than it was at origination because interest rates have fallen since I took it out.

      If my mortgage is put up for sale, should I be forced to pay the higher market price?

      That is the logical implication of saying that discounted loans should be offered to their holders.

      1. Anne

        Are the vultures being forced to pay higher market rates? @ 70%/80%/90% discounts. Hint- no they are not.

      2. Owen C

        Hmmm, i dont have a major issue with it, provided there is a transparent and simple way of ensuring there is no element of strategic default involved, ie you are not deliberately seeking to create a discounted loan by stopping payment on the mortgage even if you could afford to. This could be done by making the foreclosure/insolvency process quicker (ie the actual legal process involved) for all sides (creditor and debtor), including discovery on personal income/assets etc.

        In the Danish mortgage system, you are allowed by back the loan at the lower of market value (which would be lower if interest rates went up) or par. The difference is, if you miss a payment in Denmark, you’ll be foreclosed on within 6 months, so no one can try to use a strategic default as a way of creating a discount.

        1. Fact Checker

          Yes, but it still gets you back to the same problem:

          1) You go into arrears
          2) The loan becomes impaired
          3) The loan goes for sale at a discount
          4) The bank offers it to you for sale
          5) You buy it

          But if you can afford to buy the loan (step 5) then how come you can’t afford to service the loan (part 1)?

          For the rest, I agree

          1. Owen C

            Example

            Mortgage of 100k
            House worth 50k
            Income at a level which could service a 50k mortgage but no higher

            If someone was willing to refinance the mortgage at a 50k valuation, this would be a sustainable solution. Equally, if a family member (ie parent) was willing to give a gift of 50k, but only in the event of a writedown of the mortgage to that 50k amount.

            So, options for bank that wants rid of the loan:
            1. sell to a vulture fund for, presumably, no more than 50k
            2. write down the mortgage by 50k and let the original borrower refinance or buy it out for 50k

  5. sǝɯǝɯʇɐpɐq

    Disregard all political stunts
    And humanitarian affronts
    Shut up and relax
    Or we’ll increase your tax
    It’s not you, it’s U.S. who are counts.

  6. Nialler

    I’ve always wondered why this wasn’t the case, if the VF’s could buy at 30c in the euro for a loan then why weren’t those same rates offered to county councils or the families themselves, surely a 20%, 30% haircut on your loan would help greatly and if you’re in a position to pay more then so be it. Too simplistic?

    1. Anne

      Stephen Donnelly pushed for this and the sociopath Michael Noonan said nope.. Irish homeowners aren’t whisking him off to fine dine in the best restaurants in New York..so he had no interest.

    2. Cian

      Because if that were the case, I’d simply stop paying my mortgage. Wait 3-4 years until the bank decided to off-load it; then buy it back from the bank at 30%.

      …and then I’d not pay that 30% mortgage… wait another 3-4 years and get *that* at 30%.

      Whooohooo I can reduce my mortgage by 90% in 7 years by paying nothing!

      1. Kolmo

        Ah, the old strategic defaulters canard – straight from the Goldman Sachs/FG/Milton Friedmann press booklet – paint everyone resisting eviction in a very, very warped market as a strategic defaulter…nice, I hope they protest when they come for you..

        1. Cian

          Nialler asked a question, and I replied what *I* would do if it were on offer.
          I didn’t mention anyone else.

          However, I believe that if this were the case, then I wouldn’t be alone in doing this, and the banks would have to stop giving mortgages because of it.

        2. Sheik Yahbouti

          Kolmo, “Moral Hazard” don’tcha know. Ordinary Mortgagees = despicable scuzzballs. Vulture funds = beacons of moral rectitude. Get with the programme (or program. if you prefer – it’s sooo usa)

        3. Increasing Displacement

          Who says you’d be the highest bidder?

          Your “I’d stop paying the mortage” idea is not possible.

          1. Cian

            Because Niallo said “why weren’t those same rates offered to [..] the families themselves”. So no one else is being offered the mortgage except me.

            However, if, as you suggest, it were to go to the highest bidder, *who* else would buy my mortgage that I’m defaulting on?

          2. Increasing Displacement

            I know but there’s a lot of ways to prove you had the ability and didnt bother your hole paying. Or that if you couldn’t come up with the 30% someone else was offered.
            Maybe the council who could then rent to buy to you at a rate you can afford?
            To say it as simple as yourself or Nialler did just isn’t reasonable.

        4. Jocky

          This is so obvious yet the majority of idiots here miss it. I too would stop paying my mortgage instantly if I could buy in back for a massive discount in a few years time.

      1. curmudegeon

        I don’t know why you’re being so smart as they’ve actually done just that. Council houses (which are social housing) were sold to their tenants after a number of years, by which time the tenant is of pensionable age. Tenant now owns the property outright and et voilà suddenly there’s less social housing available.

    1. Owen C

      Some people would prefer to rent rather than buy. Others simply can’t afford to buy but can afford to rent. Are you saying they shouldn’t be able to rent a family home other than from the council?

      1. Anne

        Of course people cant can’t afford to buy when they’re being gouged by international funds looking to make a killing on people needing a roof over their heads..

        Forget oil, forget gold, forget commodities..go for the roofs over peoples heads and we’re all supposed to just shrug our shoulders and says ah well cant afford to buy my own house coz of da morket.

        I love that horsepoo you hear too of the irish being obsessed with owning their own property..well if you’re not obsessed someone else is on your behalf..as people have live somewhere, sheltered accommodation being nice n all.

  7. Joe Cool

    If we were to set up a similar group in Ireland, you can be guaranteed that they would be labelled layabouts and jobless and other rubbish

    1. Anne

      You’ll probably track him down over in NYC in the best restaurants hob nobbing with some weathy wall street sharks. Not bad for a secondary school accounts teacher in the Cresent Comprehsive School Limerick City.

    2. Rob_G

      Bodger et al, is this a joke?

      You moderate relatively innocuous comments, but leave up a threat to kill the the Minister of Finance?

  8. ollie

    There are 158 Tds and 50 Senators in the Oireachtas. Among them we have bankrupts, business owners who failed to comply with the law, a TD who was found guilty of taking a bribe, several TDs who “forgot” what they owned when completing their register of interests and a Senator who by falsified his expenses.
    No-one has faced any sanctions for their crimes, and most if not all will be re-elected.

    What a great little Country to do business, for some.

  9. Kieran NYC

    I guess the Spanish make for more photogenic subjects than the Land League/Freeman of the Land/’I am my own independent state’/’all property is theft’ people we’ve seen in Ireland in the last few years.

  10. Toni the exotic dancer

    That snake Ross McGuire Fri New Beginnings is looking to “help” with all the repos. His firm will buy up all the stock and lease it back. He’s just a vulture in sheep’s clothing.

Comments are closed.