Losing the collateral when you have an unpaid loan

[Alexandoy]

The property or real estate is the best collateral for a bank loan that is why those who are in dire need of a loan would submit their home as the collateral. Our neighbor who was building an apartment that is a condominium style borrowed $200,000 from the bank for the completion of the structure. I don't know what happened along the way because after 2 years I learned that the property (which is the collateral) was forfeited by the bank. The forfeiture was due to unpaid installments for 6 months. The owner just shrugged his shoulder when I asked for details. Whatever the reason for not paying the installments, I believe that it was his fault. The building is still here, unfinished and remains idle for more than 5 years now. The bank is actually selling the property but there are no buyers. That is a neat lesson for us to be discerning when submitting the property for the collateral. When something bad happens to the finances you will lose your home and that would be devastating for the family.

When we bought our home via a mortgage we made sure that we could pay the monthly installments. Even if we had to scrimp on food expense we did it just to be able to pay the installments. Fortunately we now own our home.

 

[Sotherefore]

The property or real estate is the best collateral for a bank loan that is why those who are in dire need of a loan would submit their home as the collateral. Our neighbor who was building an apartment that is a condominium style borrowed $200,000 from the bank for the completion of the structure. I don't know what happened along the way because after 2 years I learned that the property (which is the collateral) was forfeited by the bank. The forfeiture was due to unpaid installments for 6 months. The owner just shrugged his shoulder when I asked for details. Whatever the reason for not paying the installments, I believe that it was his fault. The building is still here, unfinished and remains idle for more than 5 years now. The bank is actually selling the property but there are no buyers. That is a neat lesson for us to be discerning when submitting the property for the collateral. When something bad happens to the finances you will lose your home and that would be devastating for the family.

When we bought our home via a mortgage we made sure that we could pay the monthly installments. Even if we had to scrimp on food expense we did it just to be able to pay the installments. Fortunately we now own our home.

Generally , I do not know the reason why they were not able to pay back the money they have collected but sometimes before getting such a loan to establish something a person should be able to have a constant source of income because this is the only way you could be able to pay back any loan you have collected .

Just like you said you were were able to pay back all the money you have collected in raising the building , a person who do not have a good source of income that is generating money constantly may finds it almost impossible in paying back the loans , that is why I will put a lot of consideration if I am thinking of following the same pattern in the future , without a sure way of paying back the money I won't even make any attempt to get a loan, that will always be a complete waste of time and resources..


The Bank shouldn't have collected the property but should have given him a period of some times to see if he will be able to pay back within that that period of time before the property was collected from him , does it really mean that he can't go back to continue his payment ?

 

[eldavis]

Generally , I do not know the reason why they were not able to pay back the money they have collected but sometimes before getting such a loan to establish something a person should be able to have a constant source of income because this is the only way you could be able to pay back any loan you have collected .

Just like you said you were were able to pay back all the money you have collected in raising the building , a person who do not have a good source of income that is generating money constantly may finds it almost impossible in paying back the loans , that is why I will put a lot of consideration if I am thinking of following the same pattern in the future , without a sure way of paying back the money I won't even make any attempt to get a loan, that will always be a complete waste of time and resources..


The Bank shouldn't have collected the property but should have given him a period of some times to see if he will be able to pay back within that that period of time before the property was collected from him , does it really mean that he can't go back to continue his payment ?

Personally I feel he made such a wrong move, I don't really see any sense in using a loan to complete a building, am guessing his plan was to complete the house with the loan then rent it out to others in other to get the cash to payback. That's risky cause what if no one rents the house? As from him bit able to complete the house, probably some unforseen circumstances came up that he had to divert the money to or from experience I know the price of building materials increases from time to time. The banks on the other hand don't wait, in such cases, they would gladly take the property.

 

[Sotherefore]

Personally I feel he made such a wrong move, I don't really see any sense in using a loan to complete a building, am guessing his plan was to complete the house with the loan then rent it out to others in other to get the cash to payback. That's risky cause what if no one rents the house? As from him bit able to complete the house, probably some unforseen circumstances came up that he had to divert the money to or from experience I know the price of building materials increases from time to time. The banks on the other hand don't wait, in such cases, they would gladly take the property.

That is what I was saying that if he was able to have a constant way of generating an income he could have been able to pay back the money but this one maybe he was having in mind to build the house then probably to rent it out for people to live in , and all these things is just a wrong assumption because anything can just happen, when getting a loan or doing anything with a loan we are always advised to do it mainly when we have an external source of generating this money to pay back but if we do not have the source then we should rather consider to look elsewhere to generate the amount of money we need to establish what we want..

Well I don't really know if there is always a condition because in some cases a bank or other financial institution would have given him a certain period of time for him to pay back the money , lf you are not able to pay back the money or to meet up with the required time then your property will be completely forfeited, the bank should have given him sometimes although what he was doing was not even the right thing as I see.

 

[Caramelle]

Our government's housing agency offers the lowest interest rates for housing loans at 4.5% to 6.5% per year. You can use this loan to purchase a residential property but not agricultural or industrial properties. They also offer construction loans on a registered lot. While people would generally expect to pay less interest on amortization for construction loans, there are actually some risks involved because they have to use the lot as collateral for the loan. Thus, if they fail to pay the loans in full, both the lot and the constructed property could be forfeited and used to pay for the loan balance. The lot owner could end up losing more on what could have been an ideal situation.​

 

[Immilash]

The property or real estate is the best collateral for a bank loan that is why those who are in dire need of a loan would submit their home as the collateral. Our neighbor who was building an apartment that is a condominium style borrowed $200,000 from the bank for the completion of the structure. I don't know what happened along the way because after 2 years I learned that the property (which is the collateral) was forfeited by the bank. The forfeiture was due to unpaid installments for 6 months. The owner just shrugged his shoulder when I asked for details. Whatever the reason for not paying the installments, I believe that it was his fault. The building is still here, unfinished and remains idle for more than 5 years now. The bank is actually selling the property but there are no buyers. That is a neat lesson for us to be discerning when submitting the property for the collateral. When something bad happens to the finances you will lose your home and that would be devastating for the family.

When we bought our home via a mortgage we made sure that we could pay the monthly installments. Even if we had to scrimp on food expense we did it just to be able to pay the installments. Fortunately we now own our hoI don't have a clue about the motivation behind why they couldn't take care of the cash they have gathered however now and again prior to getting such an advance to lay out something an individual ought to have the option to have a steady kind of revenue since this is the main way you might repay any advance you have gathered .

Very much like you said you were had the option to repay all the cash you have gathered in raising the structure , an individual who don't have a decent type of revenue that is creating cash continually may finds it exceedingly difficult in taking care of the advances , for that reason I will put a ton of thought assuming I am considering following a similar example later on , without a definite approach to taking care of the cash I will not make any endeavor to get a credit, that will be a finished burn through all the time of time and assets..

The Bank shouldn't have gathered the property however ought to have provided him with a time of certain times to check whether he will actually want to repay inside that that timeframe before the property was gathered from him , does it truly imply that he can't return to proceed with his installment ?

I don't have a clue about the motivation behind why they couldn't take care of the cash they have gathered however now and again prior to getting such an advance to lay out something an individual ought to have the option to have a steady kind of revenue since this is the main way you might repay any advance you have gathered .

Very much like you said you were had the option to repay all the cash you have gathered in raising the structure , an individual who don't have a decent type of revenue that is creating cash continually may finds it exceedingly difficult in taking care of the advances , for that reason I will put a ton of thought assuming I am considering following a similar example later on , without a definite approach to taking care of the cash I will not make any endeavor to get a credit, that will be a finished burn through all the time of time and assets..

The Bank shouldn't have gathered the property however ought to have provided him with a time of certain times to check whether he will actually want to repay inside that that timeframe before the property was gathered from him , does it truly imply that he can't return to proceed with his installment ?