Bank's mortgagee sale of house may include resident

HANK SCHOUTEN
Last updated 05:00 05/11/2012
MORTGAGEE SALE: The house at 48 McFarlane St is advertised with the words:
Fairfax NZ

MORTGAGEE SALE: The house at 48 McFarlane St is advertised with the words: "If you are prepared to take on a challenge, it could be yours too."

PART OF THE DEAL: The occupier of 48 McFarlane St, Mt Victoria, refuses to acknowledge the property is a mortgagee sale.
Fairfax NZ
PART OF THE DEAL: The occupier of 48 McFarlane St, Mt Victoria, refuses to acknowledge the property is a mortgagee sale.

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The bank forcing the mortgagee sale of a multimillion-dollar Wellington home is refusing to say why it has not attempted to evict a man who is stopping would-be buyers from looking inside the property.

The house next to St Gerard's Monastery in McFarlane St, Mt Victoria, was owned by imprisoned tax fraudsters David Rowley and Barrie Skinner, who bought it two years ago for $2,130,000.

Westpac, which holds a mortgage on the property, has ordered that it be sold to recover its money.

A Harcourts advertisement says people interested in the property could not inspect the inside of the house, which has been stripped of interior fittings and floorboards.

A man residing at the house is barring entry to the house.

He told The Dominion Post last week it was his house, it was not for sale and he was not leaving.

Westpac spokesman Chris Mirams refused to answer questions as to why the bank had not taken legal action to have the man removed, a common procedure when banks begin forced sale proceedings.

He said the bank was following normal mortgagee sale process.

"We are following our duty to take reasonable steps to get the best possible price reasonably obtainable at the time of sale."

Wellington property lawyer Peter Barrett said while banks were obliged to get the best price reasonably obtainable, they did not have to remove occupants so a house could be sold with vacant possession.

Taking action to evict a resident put a bank into the position of being a mortgagee in possession. That carried with it all sorts of legal reporting requirements.

Sometimes banks were happy to do that if they thought they could get a better price.

He could imagine a situation where it might be worth spending $1000 to evict somebody if the property was going to sell for another $50,000. However, they were not required to spend money or do anything else to improve the value of a property before it was sold.

Mr Barrett warned that people expecting a bargain at a mortgagee sale needed to be wary of the hazards. In this case, they might have to evict somebody living in this house.

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- The Dominion Post

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