Judge adjourns case in which son took out mortgage on parents' home

A COUPLE who signed over their home to their son, who mortgaged it and then fell behind with payments, were promised the house would be returned to them, the High Court was told yesterday.

Mr Justice Kevin Feeney was told by counsel for the couple, who have been living in their home in Drogheda, Co Louth, for 37 years, that they did not accept they had signed a letter for Start Mortgages Ltd stating they had no interest in their home.

The family home was transferred to their son in 1999 at his request, the court was told. The son took out a mortgage initially with Bank of Ireland and then, in November 2003, with Start Mortgages to cover outstanding liabilities from his business and to give him some working capital.

He borrowed more than €400,000 over a 12-year term and fell behind with repayments. The most recent figures showed arrears in excess of €25,000.

The son had never appeared in court to defend the case, the judge was told. On affidavit, the couple said they had an agreement with their son their house would be returned to them.

Counsel for the couple said they did not accept they had signed a letter for the lender stating they had no legal interest in their home. They had not put that on affidavit because it had only come to their attention and they could only “swear to ignorance”, he said.

It was for the lender to confirm the veracity of the documents they put before the court, counsel said.

He asked for more time so the couple could put the matter on affidavit and possibly make an offer to the lender.

Mr Justice Feeney said that given the couple had been living in their home for 37 years, any order for possession would include a considerable stay, or delay, but agreed to adjourn the case to January: “They don’t appear to have benefited from the funds generated from the mortgage on the property.”

In another case involving a son and his parents, the judge granted orders for possession on two properties in Naas, Co Kildare, to Bank of Scotland (Ireland) Ltd.

The properties, including the family home, had been refinanced with two loans of €920,000 in total taken out in 2006 and 2007. The outstanding debt was now €1.03 million. Counsel for the bank described both properties as residential investments and said the defendant’s elderly parents had only moved back into what was previously the family home after legal proceedings began against their son.

Counsel for the defendant said he was aggressively trying to sell one property and his auctioneer believed property values would rise early in the new year driven by “an upturn in the market”.

Mr Justice Feeney said counsel was taking a “very problematic approach” to the matter. He gave the bank possession of both properties, with a stay of three months on one and six months on the family home.

In another case involving Start Mortgages, the court was told a single woman had a loan on her home in Dundalk of €93,000, but had €22,000 in arrears. She had been making small payments of €25 but was “obviously of limited means”. The judge granted an order for possession, but gave a stay until July next year.

Eleven orders for possession were granted yesterday: Start Mortgages got five; EBS and ACC Bank got two each; and Bank of Scotland and KBC Mortgage Bank were granted one each.