In the wake of the 2008 financial crisis, Ireland saw a wave of debt servicing companies buy up distressed mortgage portfolios at rock-bottom prices. What looked like a lifeline for banks turned out to be a nightmare for homeowners. These companies are now responsible for a significant share of Irish home mortgages, and, according to legal experts, their aggressive tactics are exacerbating the financial distress caused by mis-selling.
What are debt servicing companies?
Debt servicing companies, or private equity firms, specialise in buying distressed assets—such as non-performing mortgages—at deep discounts. Well-known firms include Pepper, Mars, Start, and Cabot.
Debt servicing companies aim to extract as much profit as possible from their assets, often at the expense of struggling homeowners, and are synonymous with high-interest rates and relentless pressure on borrowers.
As of November 2023, debt servicing companies controlled over 110,000 Irish mortgages. Many of these were sold to them after being mis-sold to homeowners before 2009. With interest rates spiking as high as 9%, as many as 200,000 borrowers are now trapped, struggling to keep up with payments and living in fear of losing their homes.
How debt servicing companies operate
Once debt servicing companies acquire mortgages, they often increase interest rates, leading to unmanageable repayments for homeowners. This puts enormous pressure on borrowers, many of whom were already struggling with mis-sold mortgages. The rise in interest rates has left families fearing foreclosure, even if they have been diligent about making payments.
To make matters worse, debt servicing companies aren’t interested in helping you restructure your mortgage—they’re interested in maximising their returns. These firms won’t offer you the same kinds of discounts they got when they bought your mortgage from the bank. Instead, they push for repayment on terms that favour them, even if it means forcing you into default. Their priority is the equity in your home that has built up due to Irish house price increases over the last few years.
Many homeowners report being harassed by debt collectors working on behalf of debt servicing companies, making an already stressful situation even worse. Calls, letters, and threats of legal action are common as these firms try to extract every penny from struggling borrowers.
The way forward for struggling homeowners
If your mortgage has been sold to a debt servicing company, you have options. Legal and banking experts believe the vast majority of these mortgages were originally mis-sold, meaning you could be entitled to compensation.
Putting you in touch with a legal and banking team experienced in mis-selling and Irish and EU consumer law, we help you to fight back against these predatory practices, potentially claim thousands in compensation, and secure your financial future.
If you are under pressure from a debt servicing company or its agent, or are already in the court process, you have options. Join the Claim and these options will be discussed after your registration.
Take action today
A staggering 90% of mortgages sold to debt servicing companies could be mis-sold in some form. You could have a mortgage mis-selling claim if any of the following apply:
- Your mortgage term extends beyond your retirement age
- You were sold an interest-only mortgage without proper consideration for how you would repay the original loan amount
- You were allowed to self-certify your income without providing proof
- Your lender didn’t properly assess your ability to repay
- Your lender didn’t fully consider your personal circumstances
- The lender did not explain all of the key risks associated with the product, so you couldn’t make an informed decision.
Use our fast and free online checker to see if you have a claim*. If eligible, we’ll connect you with Irish mis-selling experts who will investigate your case, keep you updated, and aim to get your compensation.
By taking action now, you are standing up for your rights and helping to create a fairer financial system for everyone. Start your no-win, no-fee claim today and reclaim what’s rightfully yours!
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