Home Economics: Answering your property questions
Personal Finance expert Sinead Ryan answers your property questions.
Q. I was interested in purchasing a property at the Allsop auctions since some of prices appeared very good value and my money was earning nothing in the bank. To that end, I attended a recent auction and found a house that I wished to bid for at a very affordable price. My son insisted I first check to see if there were any problems associated with it and, to our shock, we learned there were no fewer than three mortgages secured on it. It seems this would have left us wide open to being chased for the debt by the owner or have the bank come after us. Is this allowed and why isn't the full information made available?
A. First of all, I would have to point out that buying property, even at an 'affordable price' is something that should only ever be undertaken after great diligence, research and preferably legal advice is sought.
That said, I contacted Allsop regarding your query. They are extremely experienced at auctions, with a high success rate of 90pc. There are links on their website, also made clear to prospective buyers at the auction, directing them to legal documents, contracts for sale and planning issues, along with a buyer's guide. They always recommend novice buyers use a solicitor to bid and advise. The job of the vendor's solicitor is to check the land registry and for liens and charges against a property, so it comes to them with this known. In a Receiver sale, which, according to the date on your email, this was, they pointed out that legally, the bank taking the repossession action (and thereby forcing the sale) takes precedence over any other debtors with an interest in the property and in the event of a sale, as the first charge-holder, any other liens or mortgages are effectively null and void. There is no possibility of you being chased for any residual debt as this stays with the previous owner and not the property.
This really isn't DIY territory and in the same way you wouldn't buy a car without knowing its provenance, you should tread carefully. If you are still interested in a purchase, it is a small extra expense, but a vital one, to equip yourself with legal advice first.
Q. Myself and my wife are in what's termed our 'twilight years' (we are nearing 80). While we are both well at the moment, we live in quite an isolated area and our only son has now moved to the UK, leaving us without close family near. I read an article some time ago about a retirement community where people like us can live independently, but where there is medical help and like-minded people of our age around. I can't remember if it was here or in England. Are there such places in Ireland?
A. There are indeed! Retirement villages or communities are definitely the way forward and, as most older people would prefer to stay in their own homes as long as possible, it's great that developers are recognising that putting certain supports in place can facilitate that. Most are centred around nursing homes, but are stand-alone private bungalows or chalets which can be leased. They can offer medical supports (like call buttons or nurses on site) meals, laundry and, of course, are built specifically with older people in mind, generally with rails, ramps and no stairs etc.
Unfortunately, you didn't mention where you live, so I'll direct you to a website which has a county-by-county listing and you can take it from there. It's www.retirementservices.ie, (085) 867 4977. Senior Care also has a great listing on its website (www.seniorcare.ie).
In addition, if it's the case you might avail of social housing and not be in a position to go privately, consider www.foldireland.ie (01) 8228804 for similar services. I'd also suggest you give Age Action a call (01) 475 6989.
Best of luck with your search.
The Ryan Review
The proposed new Mortgage-to-Rent (MTR) scheme that is being rebranded, remarketed and refinanced privately is sure to attract the interest of pension funds and investors.
With repossessions on the rise (the latest Central Bank statistics show 1,397 houses had legal proceedings taken between September and December 2016), only the stubbornly difficult arrears remain. Where restructuring options are offered, such as interest-only loans, split mortgages or term extensions, 87pc of home-owners are meeting the revised repayments.
But 77,943 mortgages are still in arrears, half of them for more than two years. Helping people stay in their own homes while transferring the debt and allowing them rent is a solution that seemed better on paper than in reality.
The problem was the restrictions placed on the property's value and the income of the resident were all but impossible to meet and the scheme flopped.
But the new proposals, which hope to see 10,000 of them moved to investor groups like pension funds, is a better solution and allows rural home-owners, and those living on more than social welfare benefits, be included.
The alternative is a ramping up of repossessions, which banks like AIB would come under pressure to do prior to its flotation. Repos are expensive, slow and garner bad press. MTR only ticks one of those boxes, but we can speed things up.