The Irish Times 06.09

Sunday Business Post

When overseas property goes wrong you need a troubleshooter. Frances O'Rourke finds some experts who are helping Irish investors who were too trusting, careless, scared of facing up to their problem - or just plain unlucky.
(June 2009)

Did you hear the one about the woman in France who didn't pay management fees to her apartment block's syndicate, which is on the point of selling the apartment (and keeping the money)? Or the woman who defaulted on her mortgage payments in Spain - and found her bank had sold her villa before she knew about it?

Irish investors who buy abroad are often in a quandary when things go wrong - and more overseas buyers than ever are finding themselves in trouble right now. Who can they call on?

SPAIN (and 18 other countries, from Bulgaria to Brazil):

Irish solicitor Tom McGrath started advising clients on properties in Spain, a country he knows well, and can now advise on problems from Bulgaria to Brazil. He fears that the problems he's dealing with now - properties being repossessed, large advance payments on uncompleted developments being lost, "guaranteed" rents not being paid, to name just a few - are just the tip of the iceberg.

The most common problem he is dealing with at the moment is that of people who have paid a deposit to buy a property off plans in developments where builders can't complete, because they don't have the money. "Often the client is faced with the undesirable choice of spending more money to recoup sums (by taking legal proceedings) or walking away."

Other people have been duped by unscrupulous agents - e.g., one group he is advising had signed contracts with an Irish agent who promised to organise rentals for their properties and make mortgage repayments. Rents were not paid to clients, nor were mortgage repayments - which are the owner's responsibility.

"One of the most common problems is that clients find that they have bought something which is not what they were originally sold by the estate agent" - finding instead they are nowhere near the sea/golf course/promised view and so on. Other problems he's dealt with include a client whose contract was handwritten on a sheet of paper with no terms or conditions, and who had paid a deposit based on this contract. Or a client who bought a property in Germany (sold by an Irish agent) who later discovered that the unit was in a protected block that could only be sold to German citizens.

McGrath and his team help people sort out what can be rescued from what can't and at the very least, to minimise their problems where possible. The most important thing of course is to get good advice before buying - on everything from clear title to tax, planning and inheritance matters; next is to act quickly if you are in trouble. In Spain, for example, people have had their properties repossessed for non-payment of mortgages because they didn't know that notices had been served on them in Spain. "Not opening your post is a bad, bad move. Spanish banks have approached me wanting to do deals, they don't want to repossess." McGrath can help people come to an arrangement with lenders - if they come to him soon enough.

Tom McGrath
Tel: 01 661 0707 / 678 8774
www.tmsolicitors.ie