Couple lose home as lender wipes out €200k debt

A COUPLE’S mortgage debt burden of over €200,000 was wiped out by their lender — but they lost their home in the deal.

The couple, who have not been identified, got a written agreement through their Dublin-based solicitor, Anthony Joyce on a final settlement from lender Stepstone Mortgage Funding.

Mr Joyce said the couple had initially wanted to hand the keys back to the lender but he had persuaded them not to.

The couple had agreed with Mr Joyce that the documentation in relation to the loan should be reviewed to see if they could persuade the lender to write off the balance.

Eventually, it emerged, Stepstone accepted a sum of €154,950 instead of the €360,000 that was owed.

Mr Joyce said the couple could not keep up with the repayments and had left their home, intending to post the keys back to the lender.

They had called into his office with a letter warning that if they handed the keys back to the lender, they could be pursued for the balance of the mortgage.

Mr Joyce advised them not to sign the letter, to put their property on the market and to allow him liaise with the lender.

He put them in touch with an estate agent who sold the house but the sale price was significantly less than the amount owed.

Mr Joyce told RTÉ Radio yesterday Stepstone had agreed to take a sum of money from the sale of the house after both the solicitor’s and auctioneer’s fees were deducted.

However, he did not believe the couple’s case would lead to more lenders taking the same route in dealing with people in mortgage arrears.

It was, he said, a route that most lenders were trying to avoid taking and that the case he took may have been “a once off”.

There were, however, a number of cases going through the courts where the issue as to whether the lenders had behaved in a reckless fashion had still to be tested.

He had one case involving a retired elderly couple who had been lent money where it was not part of the loan agreement that they had to have life assurance.

Mr Joyce said one of the individuals had died but the balance of the loan was still owing.

The Co-founder of New Beginning, that provides free legal aid to struggling home owners in arrears, David Hall said the organisation had been involved in five cases where people with clearly unsustainable loans opted to sell their homes in order to write off the full mortgage debt.