Posts Tagged ‘Cerberus’

How loan sales and vulture funds could result in thousands of people losing their homes

A financial advisory company that specializes in dealing with personal and professional insolvency is warning how a state bank’s decision to sell off troublesome and underperforming loans could result in thousands of people losing their home.

Bell and Company are keen to alert homeowners in the North that are likely to be affected by Permanent TSB’s decision to put under-performing mortgages up for sale as part of Project Glas.

Terry Bell, Bell & Company Principle, said: “This decision by Permanent TSB is going to have lasting and damaging effects for those who own properties in certain regions. We are currently working with a number of clients that we know will be put out by this decision.

“The bank is 75% owned by the state and is planning on selling a loan book worth €4 billion to vulture funds. It’s important to recognize though that in some circumstances, not all of the customers who are going to be affected by this are underpaying or are guilty of not engaging with the bank and their financial responsibilities.”

“Often in these kinds of circumstances, customers who have engaged with their bank and have established financial arrangements are still classed as “non-performing”, despite their clear intentions of paying off their loans.”

“This sale will undoubtedly “stoke the fire”, of the many homeowners and investors who have been able to avail of extremely low tracker-rate mortgages, and the lender will definitely come under pressure from the new owner.”

“We are now urging anyone that is concerned about the implications of this proposal to get in touch with us today and allow one of our specialized financial advisors to help you find the best possible outcome for your problems. We are experts when it comes to providing strategies for people keen to overcome property debt.”

Those facing these property problems should also be aware that attempting to negotiate with vulture funds can be hazardous, especially when it comes to restructuring mortgages.

Terry continues: “With figures revealing that the amount of mortgages in arrears held by private investment funds has risen and home possession is also rising, perhaps it is time for politicians and parties to stand up against the damaging effects that vulture funds can have on ordinary families.”

For more information about managing debt or to get a free financial review, call Bell & Company on 02895 217 373 or email [email protected].

AIB Loan Sale: €1.8bn Purge to Vulture Funds

AIB Plans €1.8bn in Loan Sale to Cerberus and other Vulture Funds

The Irish Times recently reported that the private equity firm Cerberus, ironically named after the mythical three-headed dog guarding the gates of Hades, is moving forward in potentially purchasing some of AIB’s loan book.

AIB is planning a purge of its non-performing €1.8 billion loan book, as it prepares to move out of the hands of Government ownership, triggering fears among borrowers that their loans may be offloaded to vulture funds in advance of the Bank’s privatisation, according to the Sunday Business Post.

Late in 2017 we saw Ulster Bank sell off a similar amount to the vulture fund, with around 14% of the loan book affecting those from Northern Ireland and 1% affecting local farmers and Agri-businesses.

To date Bell & Company have successfully dealt with many cases regarding vulture funds and we encourage those affected to act early.

What’s Next for AIB Loan Sale?

AIB are presently preparing to sell off their non-performing loan book of c€1.8 billion and action is imminent. It is believed that these Non-Performing Loans account for in and around 15.5% of the entire AIB loan book and the starting point will be to sell of hundreds of investment property non-performing loans.

The subject loans will, most likely, be divested to Private Equity companies/Vulture Funds with the likes of Cerberus reported to be one of the most probable buyers.

The aggressive route adopted by AIB of late, has seen more than 60 Summary Proceedings being lodged against borrowers in January alone.

Anyone with a distressed loan with AIB must treat this with a great element of urgency and act now as it would suggest the Defendants in such cases are being ‘lined -up’. A case with a Judgement thereon is a more complete product for a loan sale.

Important To Act Now

Many are of the mistaken belief that the purchasers of these loans will act somewhat as Debt Collectors and be happy to generate any sort of return on their investment. Many people say, ‘what would they take?’.

It is not a case of a standard rate applied as every case is different and any acquiring third party will be out to maximise their return thus a robust approach will be taken by them.

They are not Bankers. They want to maximise quickly their security, make their profit and move on, so be ready.

It is of the utmost importance that anyone who feels that this AIB Loan Sale could affect them, takes advice and acts now to avoid loss of control as well as loss of what is important.

If you, or anyone you know, currently has a distressed loan with AIB, we would strongly urge you to call our Business Relationship Team immediately on 02895 217373.

I am a company director of a limited company with personal Guarantee. How will this effect me?

I am a company director of a limited company with personal Guarantee. How will this effect me? More often than not where a Lender is offering loan facilities to a Company, they will, by way of security, require a Personal Guarantee to be offered by the Director(s) of same Company. This will essentially provide the Lender with the reassurance that, even in the event of the Company becoming insolvent, they can pursue the Directors directly and personally in relation to monies owing. It provides them with an extra layer of cover so to speak…

Directors (especially in the past) will have seen this as a risk worth taking, particularly as it could massively influence the Lender’s decision as to whether to approve/deny a loan application submitted on behalf of the Company. This is all very well when the Company is performing however where a Company begins to experience financial issues/is showing signs of being in a position of financial distress, Personal Guarantees can have serious and hard hitting consequences for the obligated Director(s).

In some instances, Personal Guarantees will be capped at a specific amount and the amount will have been influenced by the overall, net worth of the Director(s) at that time. In other instances however, Guarantees will be somewhat open ended and will be as wide as to cover all debts owing by the Company to the subject lender. Negotiating in relation to a Personal Guarantee is most definitely possible, when broached in the correct way and with the right presentation, however is not straightforward.

The subject lender will analyse the position in an in-depth manner and conduct a high level of due diligence, often engaging specialist professionals, in order to determine what can be recovered thus it is imperative that positioning and approach is concise and watertight. Creditors will look at various aspects of the Director(s) position, not least, to include asset/monetary position and a number of documents, reports and evidence will be required to be submitted in order to support any submissions made. There are central in the context of negotiations.

Once again, the importance of obtaining the correct advices with regards how to communicate/approach must be stressed here as this can very often mean the difference between losing and retaining livelihood/home etc. The importance of being pro-active cannot be emphasised enough as failure to do so will often result in Judgment/Statutory Demand, both of which can be avoided when the correct steps are taken.

To conclude, we would state as follows:

Whilst Personal Guarantees do not very often impact/feature in the thought process of Directors at the time of loan application and where the Company is performing, other than to be considered the determining factor re sanctioning/rejection, they can have serious, personal consequences where the Company becomes insolvent and the debt is called in. The Lender is entitled to explore all surrounding property, the equity therein and the financial well-being of the individual and can pursue up to and including Bankruptcy in which event there is often a lot at risk.

This can be avoided in its entirety if the correct line of communications are adopted from the outset and with the right advice, guidance and representation. There are significant savings to be achieved if handled in the correct way – We have achieved savings at 0.6% of overall debt owing however each case will be circumstance dependent. Why take the risk caused by delay…?

Act now and protect what is important.

My Loan Has Been Sold to A Third Party – What does this mean for me?

At Bell & Company, we assist individuals whose original loans have been sold to a third party.

Vulture Funds

An initial reaction from Borrowers whose loans have been sold is that of trepidation.  This attitude is likely brought about by reading articles wherein these third parties being called “Vulture Funds”.  Some firms have outlined the likes of Cerberus and Lonestar as being vulture funds. There is without question the opportunity to resolve defaulted debt accounts and Personal Guarantees.

Many clients, that we are currently assisting in this field, have seen that a loan sale has given them the opportunity to address the issue. The case with many lenders, who sold loan books, is they were previously inundated with cases. These cases required resolving without having the personnel or resources to resolve the matter.

Conversely, a loan purchaser will be looking for a quicker turnaround and a return on their initial purchase which will be a significantly reduced price when compared to the outstanding loan balance, dependent of course on the Borrowers’ surrounding position.

Benefits for the Borrower

Considering this, the benefit for the Borrower is they are dealing with an entity that has the appetite to address the issue and are looking for a return which is significantly less than the overall liability. Essentially, a loan sale gives the borrower a chance to finalise a problematic loan default, Personal Guarantee or debt.

Your third party will be requesting proposals and Bell & Company have the experience on how to structure, present and negotiate any proposal tailored to your current circumstance. Our Corporate department work in this field daily and are changing both the lives of individuals as well as business prosperity. Many successful businesses have been subject to defaulted debt and once resolved the fabric of a successful business can remain.

If you or anyone you know has a personal or business loan, sold to a third party and want professional independent debt advice.

Please call the office today on 0330 159 5820.

Bell & Company always offer a free initial consultation and we look forward to meeting you to outline all the options available.

Could I lose my home?

Could I lose my home?

One thing we understand entirely is that home is sacrosanct to most people thus it is imperative that the situation at home is investigated first and foremost. In many instances, a Borrower/Guarantor’s home will be mortgaged with another lending institution and, as a result of the property crash, there will very rarely be equity in the home thus there is nothing there for lending institutions to pursue/Official Receiver to vest an interest in.

However, each case is different. A lot centers around mortgage balance, current market value and whether there is any equity within the property. A lending institution only can initiate repossession proceedings. if your home has been directly offered as security.

Personal Guarantee

If you have signed a Personal Guarantee, your personal assets are exposed. Any Creditor can seek to realise the equity in any assets relating to you by seeking Judgment and enforcing same thereafter or, alternatively, petitioning for Bankruptcy, even if they have no security.

If there is equity in your home, this will have to be considered in any settlement proposal to ensure that the same is protected. This will often avoid aggressive action than by a Creditor. However, rights are always reserved.

If you or anyone you know could benefit from our services, please call us today on 0330 159 5820.

 We look forward to working with you.

PODCAST: Frustrated by the delays that are being caused by Cerberus’ current approach?

Welcome to the first edition of the Bell & Company podcast. Today we have HELEN MCCARRAGHER discussing Cerberus.

You may recall over the last month we have been placing a focus on Cerberus. In fact I took it upon myself to write a paper on the subject for my most recent MBA modules such is breadth of scope and detail regarding their acquisition of loan books both in Northern Ireland and Republic of Ireland (Sad man but true!)

Whilst there has been a lot of bad news regarding their acquisition of Project Eagle from NAMA, with particular scrutiny placed on their debt collection techniques and also a government fixers fee, Bell & Company from the outset have advised their clients to work with Cerberus. At the end of the day we can only work with what is in front of us and understanding their protocol, as we do, can achieve excellent results. This is vindicated with Cerberus advising a Stormont committee of significant write downs.

Details of Cerberus’ action to date:

 

 

Bell & Company have long believed there to be a real opportunity for our clients to work with Cerberus and extricate themselves from non-performing default loans. When with NAMA or the Ulster Bank negotiations often become stagnated but with Cerberus we have found there to be a real proactive approach working out what is best for all parties.

Should you or anyone you know had your loan sold to Cerberus then please contact Karen in the office today on 028 9521 7373 to arrange your free initial consultation.

James Bell – London Office Manager.

CERBERUS – WHATS NEW?

You may recall over the last month we have been placing a focus on Cerberus. In fact I took it upon myself to write a paper on the subject for my most recent MBA modules such is breadth of scope and detail regarding their acquisition of loan books both in Northern Ireland and Republic of Ireland (Sad man but true!)

Whilst there has been a lot of bad news regarding their acquisition of Project Eagle from NAMA, with particular scrutiny placed on their debt collection techniques and also a government fixers fee, Bell & Company from the outset have advised their clients to work with Cerberus. At the end of the day we can only work with what is in front of us and understanding their protocol, as we do, can achieve excellent results. This is vindicated with Cerberus advising a Stormont committee of significant write downs.

Details of Cerberus’ action to date:

Bell & Company have long believed there to be a real opportunity for our clients to work with Cerberus and extricate themselves from non-performing default loans. When with NAMA or the Ulster Bank negotiations often become stagnated but with Cerberus we have found there to be a real proactive approach working out what is best for all parties.

Should you or anyone you know had your loan sold to Cerberus then please contact Karen in the office today on 028 9521 7373 to arrange your free initial consultation.

James Bell – London Office Manager.

 

 

CERBERUS, CERBERUS …. WHAT ABOUT OTHER BANKS?

Before you continue reading this weeks blog why not check out our recent settlements by clicking the link below

https://www.bellcomp.co.uk/category/property-debt-settlement/

NAMA DRAMA – CERBERUS ISSUES

CERBERUS & LONE STAR PROJECTS IN UK & REPUBLIC OF IRELAND

***Cerberus Reminder***

With Cerberus being active in the EU and Ireland, Bell & Company can assist any debtor whose loans have been sold to Cerberus.

Meetings and Discussions with Cerberus

Loan Sold to Cerberus? Act Now!

In a recent blog we discussed the sale of Ulster Bank loan books to Cerberus. Since then things have moved a pace and at Bell & Company we are pleased to report we have had constructive meetings and discussions with Cerberus thus far.

Cerberus are now starting to initiate contact with borrowers whose loans have are in their book and are looking to arrange meetings with Advisors and their client. Although working through these gradually their turnaround time in negotiations seems most efficient and without doubt more efficient than Ulster Bank previously.

Capita make a decision on initial submissions and they make it relatively clear from the outset and give the following options:

  1. Write a cheque for full amount or,
  2. Submit a proposal within 28 days, or
  3. Debt Enforcement/Recovery

Capita has a number of ex Ulster Bank employees who then report to Cerberus, we have an excellent relationship with staff here.

To date Cerberus have been open in their approach and Bell & Company have found we can talk to them quite openly. They are keen to come to settlements and believe it is in the best interest to do this on behalf of the borrower and their stakeholders.  They seek fresh settlement offers, and any previous settlements put forward to the Bank should be used for reference only.

Cerberus too seem to wish to avoid any acrimonious proceedings and therefore clients who had issues with the Bank in the past can look to move past these and drive negotiations.

Although many have expressed concern about their loans being sold there is an excellent opportunity to be had to negotiate a reduced Full & Final Settlement or re-finance elsewhere. We have noticed some advisors telling their clients to be aware of these “vulture” funds, but in Bell & Company’s experience to date providing you enter amicable dialogue and understand the protocol’s Cerberus work within then meaningful results can be achieved.

If you have been contacted by Cerberus or Capita, or expect to be contacted in the near future then call Bell & Company today on +44 (0) 2890 517047 to arrange a free initial consultation to discuss your circumstances. We look forward to working with you.

As ever being proactive and appointing people you can work with and who understand and know the processes involved, “warts and “, is vital …. So call us today.

Terry Bell – Director

Cerberus and Ulsterbank- Loan sales- What is going on!?

In late 2014 it was announced that Cerberus had purchased Ulster Bank’s giant non-performing Project Aran loan book. Cerberus paid £1.1bn for Project Aran which has an unpaid loan balance of c£6bn. The transaction completed in the first quarter of this year and Cerberus and Cerberus Capital management have started to work away.

Project Aran consists of 6,200 loans and 5,400 properties with 75% of the loan balance secured in Republic of Ireland and 20% in Northern Ireland, incredibly 90% of this loan book is in default.

Royal Bank of Scotland stated, “The transaction, which represents RWA equivalent of c£1.2bn as at 30 September 2014, is part of the continued reduction of assets in its RBS Capital Resolution division and is in line with the bank’s plan to strengthen its capital position and reduce higher risk exposures.” Perhaps they should have said, we have no means of resolving this debt on behalf of the Bank’s stakeholders and borrowers!

In recent days Cerberus have agreed to purchase another Ulster Bank Portfolio known as Project Rathlin. The transaction involves a purchase price of £205mn with the portfolio valued at £1.4bn.  This purchase falls in line with the Banks continuing efforts to reduce assets and high risk exposure. Project Rathlin has properties across Northern Ireland including substantial defaulted loans and well know properties in Belfast.

It is understood Cerberus are dealing with the highest loan values and that everything will be for sale. It is clear Cerberus are looking for a return on their investment and have set a time frame for 2 ½ years, which is tight given the substantial size of the Project Aran book. Given the tight time frame assets will be sold off a lower price and a typical sale in possession means a sale price of c60% of market value or even less.

Cerberus and Ulsterbank- Loan sales-

Cerberus Capital Management will manage facilities and some Ulster Bank staff have moved across to this department.

After a slow start, Bell & Company understand debtors in Project Aran will soon be receiving relevant letters from Cerberus and those in Project Rathlin further down the line. This will hopefully bring a resolution to this disastrous and long standing loan book.

Call Bell & Company today on 02890 517 047 to discuss your position with Ulster Bank and/or Cerberus. We have an excellent relationship with both the Bank and Cerberus and can work with you to a solution.

Terry Bell – Director

BellandCo Logo jpeg