Landlords 'pocket rent but leave loans unpaid'
Published 29/03/2011 | 05:00
BUY-to-let investors struggling to meet mortgage repayments are pocketing rent and refusing to pay banks with the income.
Yesterday a senior judge highlighted the practice of investors and homeowners renting their houses and keeping the income instead of using it to pay arrears and mortgage repayments.
"It is extraordinary how many people seem to think they can take the rent and not pay," said High Court Justice Elizabeth Dunne.
The judge made the remarks as some 17 homes and investment properties were repossessed at the High Court.
The extent of mortgage distress experienced by some homeowners was borne out by several cases where mortgage holders were paying as little as €50 a year. Many went in to immediate default after drawing down loans.
In one case, a married couple with three children, who defaulted on their first direct debit, had their home repossessed.
The couple, who amassed some €32,000 in arrears on an original €120,000 loan, had paid less than €3,000 since 2009.