Handing back keys to bank – negative equity house sales

Recently, we came across our first situation, where a former client of ours went (without our knowledge) into their bank in Kilkenny city. The customer asked to see the financial institution’s manager.

Upon meeting, the person said they could no longer afford to pay the loan back to the bank, and gave the keys to the manager. This is a reflection of the sad times that the citizens of Ireland now find themselves. More action is needed to help people out. This person will actually be unable to get Government aided housing as they were not forced out of their home by court order !

The bank ( permanent tsb, kilkenny) also made contact with us and here is some of what is in their letter to us = “Please note that the bank is prepared to enter into vacant possession of the premises.The following should be noted in relation to voluntarily surrendering the property:

The Company requires full vacant possession and therefore all personal belongings must be removed from the property before handing in the keys.

  • The keys of the property should be handed into the local permanent tsb branch
  • A Voluntary Surrender Form (please find enclosed) must be signed all parties to the mortgage in the presence of a witness.
  • A staff member of your local permanent tsb branch can witness your signature when you are handing in the keys of the property.  Please call your local branch directly to make an appointment to do so. Please also bring photo ID to the branch on the day.
  • The Company will then secure the property and independent valuations will be carried out before the property is placed on the open market for sale.

 Please note that all parties to the mortgage will be still liable for all monies owing and interest accruing on the loan until it has been repaid in full including any costs that are due in relation to the sale of the property. 

 Any surplus funds remaining once all monies due and owing (including all costs) have been paid will be reimbursed to you.”

The voluntary surrender form, which was attached to the letter, also includes the following = ” We acknowledge that not  withstanding our Voluntary Surrender of possession of the Mortgage Property,we are liable to Irish Life & Permanent  Plc trading as  Permanent  tsb for all monies owing and interest accruing to the Company on my/our loan until same is repaid in full.I/we further confirm that the above property is devoid of all personal effects and that any furniture,chattels or effects remaining in the property may be disposed of by the Company as it deems fit. ”

Unfortunately, most solicitors in Kilkenny city and county will see this happening at a larger scale over the coming years. There appears to be little in the line of debt forgiveness, although had the client firstly engaged lawyers then we might have got a better deal for them.

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