This article was originally published by The Sun.
What are vulture funds?
In a nutshell, vulture funds are investment firms that buy up properties from banks.
You may often hear of the vulture funds buying ‘property portfolios’ which refers to the company buying the properties in bulk.
The portfolios that are bought can be both commercial and residential which is how homeowners across the country got mixed up in the financial crisis that has gripped the nation.
Why are people worried about them?
During the recession, the vulture funds bought up these ‘distressed’ portfolios from banks in trouble.
The vulture funds then seek to get the loans repaid, meaning that average homeowners no longer deal with the bank they originally got their loan from.
Ian Kehoe referred to this saying: “It’s one of the most stressful things, to be in difficulty on your own mortgage and not be able to talk to somebody who knows your personal situation.”
“You take out a loan from a bank, and you assume you owe that money to a bank and suddenly it happens by a letter, every single time it happens by a letter in the post and it says, ‘You no longer owe your money to AIB or Bank of Ireland, you now owe it to some bizarrely titled special purpose vehicle called Tanager or Promotoria or Arrow”.
What are special purpose vehicles?
The special purpose vehicles Kehoe refers to are set up by vulture funds to manage the assets acquired from the troubled banks.
Kehoe refers to Tanager and it is that private equity firm that father of two Donal Burns now owes his debt to – a debt they will no longer accept payment for.
His story is set to be told in RTE documentary, presented by Ian Kehoe, ‘The Great Irish Sell-Off’, airing tonight on RTE1 at 9.35pm.
Donal made two bids to purchase the house back from Tanager after having it valued by an auctioneer.
He told the documentary: “They have decided that they want the house back and that’s it.”
Donal says his offers were rejected without explanation.