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High Court Warehousing Judgement

Created: Jul 04, 2017

Background of the Callaghan Case

The couple reside in a 3 bedroom semi-detached property with their 3 young children.  The couple had a mortgage with KBC for €285,647 for their family home which was valued at just €105,000.

PIP’s Proposal

The PIP proposed a reduced interest rate of 2.5% from 4.5% for the period of the PIA and thereafter reverts to 4.5% for the remainder of the mortgage.  The mortgage to be extended by 6 years until Mr. Callaghan reached 70 years of age and a write off of €165,647.

KBC’s Proposal

The bank proposed  to split the debt into an active and warehoused mortgage of €135,000 each and a write off of €15,647.  As part of the proposal the warehoused mortgage would carry 0% interest and the couple could reside in the home for the rest of their lives.

Baker Ruling

The Judge ruled in favour of the couple and rejected the warehousing of €135,000 as the warehoused is not proportionate to, or reasonably derived from, the current income and capital assets, or any future ascertainable means.  The Judge confirmed that warehousing of a mortgage debt is permissible in principle, but it was not reasonable in the circumstances of this case.

To read the full judgement please click on the link here

New Revenue Subsistence Rates

Created: May 07, 2017

Subsistence Rates Key changes: The new increased subsistence rates announced by Revenue effective 1 April 2017 are:

Overnight Allowances Day Allowances
Normal Rate Reduced Rate Detention Rate 10 hours or more 5 hours but less than 10 hours
€133.73 €120.36 €66.87 €33.61 €14.01
A separate Schedule based on current Civil Service Subsistence Rates applies for absences outside the State If you require advice on this or any other business or financial issues, please don’t hesitate to contact Carmel Kelly or Declan Mannion.