“Banks are going to have to adopt a harder line with borrowers who are in arrears; even if it means that they end up losing the roof over their head”
Over the course of a number of years there has been a constant theme in the news regarding loan sales and how more and more banks are selling off their non-performing loans. Between 2013 and 2017, there had been a drop of €50billion worth of non-performing loans. From the outset, this is positive for Ireland but we need to remember that a seventh of all loans are classed as being “non-performing”.
When we look at the figures in more detail it is still a major concern for the island of Ireland;
- €19billion worth of non-performing loans are mortgages;
- · €6billion are loans to SMEs;
- · 29,000 non-performing loans on primary dwellings are in arrears of more than two
- 13,100 buy-to-let mortgages are also in years of more than two years.
The solution for dealing with these loans is to sell to vulture funds – they are no longer the burden of the Bank and they no longer have to deal with the borrower, but the borrower is the one that has to worry about keeping a roof over their head.
However, the Central Bank prefers institutions to restructure the debt and offer the borrowers a solution rather than sell the loan at the first opportunity. On the majority of cases, many banks take the latter option and for them the easier option. Restructuring a debt can benefit the borrower, if done properly, nevertheless with interest rates due to rise in the next 12 months will this become unaffordable for restructured borrowers?
What we can do to help?
Since 2010, GDP Equity Experts have helped hundreds of businesses deal with debt related issues. We have been leading the way in this regulated area over the last 8 years and have particular expertise in helping people deal with crippling debt related issues.
We would like the opportunity to share this with you. As a result, our team are more than ready to engage and assist if you have been affected by this or you have any other property debt related issues.
GDP Equity Experts know what is expected and how to get you to where you want to go. We WANT to hear from you today because we WANT to help you today.
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