Real Estate /
Foreign investor, properties in Poland, walk away from mortgages? [209]
1)
Well it sounds like this is all most likely a purely theoretical discussion, as it might be near impossible to actually accomplish.
Polish civil law 1.01 ( ok, maybe 3.59 :-) ) :
It is not a theoretical discussion. I know what I'm talking about, I pretty much live real estate ( Polish real estate included ).
Of course You can transfer such assets ( flats in Poland with an appropriate "Ksiega Wieczysta" that were used as collateral for the bank and the mortgage hasn't been paid back yet ) into an Ltd in Poland. Anyone telling You otherwise is probably a goody two-shoes attorney or notary and as a ruthless real estate trader You shouldn't be doing business with them in the first place :-)
The Polish Supreme Court has issued a ruling quite a while ago which states that ownership is ownership and You can transfer it regardless of who holds the mortgage and what they agree to or not. You can pretty much transfer the bloody real-estate ownership while a "komornik" ( public official that does repo in Poland ) is out there trying to sell that ****. Some notaries won't be involved in such shenanigans, but it is legal from the standpoint of Polish civil law.
I could find the ruling, but then I'd honestly have to start invoicing You.
2) I've done Ltd's in Poland for what now is ages.
And Your conclusions from the quote above are based on a misconception. If the credit obligation came into existance between the bank and the ltd --> then hell, yeah, You're right, You sink the ltd, wave goodbye and move on to pastures greener.
But if it was You personally that signed the dotted line all that I wrote about the bank being able to go after Your personal assets applies. The only things that will possibly hold them back will be:
a) costs ( circa 100.000 quid IMO will be worth their while ),
b) creativity and knowledge of their legal eagles,
3)
But presumably, if (and it's a big IF) the assets and debt and basically the entire investment could somehow be transferred to a Ltd Co at this late stage in the game, then those debts would be a purely limited liability of the company, and no longer have any relation to "who signed on the dotted line".
The only way You'd actually be able to place the debt, the assets and everything else in an ltd while at the same time removing the personal responsibility ( and the possibility of the bank going after that person's assets ) of the person that signed the dotted line would be if You got the bank ( the creditor ) to agree to the transfer of both the ownership of the property ( which, taking into account what I wrote in p. 1 they can't really say "no" to ) and
to the full transfer of responsibility to the new buyer.And unless there's a bunch of chimpanzees manning that particular bank branch this is just not going to happen, that "ltd transfer" simply stinks of fun and games. I can't see a bank agreeing to that, especially since the amount of capital necessary to start an ltd in Poland is 5.000 zloty.
4)
To add an interesting point to the mix, I would mention that, although most of the assets involved are currently owned by myself personally (and thus mortgages being in my name, and debts being my personal liability), some smaller portion of the assets are actually already under the ownership of my Ltd Co. For example, one of the property purchases required a separate deed of sale for ownership of a portion of the road in front of the property (don't ask why, I have no idea..) - and so I did manage to have that deed in the company's name. Now, this is probably a very tiny part of the overall assets, but it is something, and it does give me something to show that these assets could in theory be owned by the company, and it also raises an interesting point about the mortgage. If the mortgage is in my name, but some of the assets (even 0.1%) are owned by the Ltd Co, does that mean that some portion of the liability is actually a liability of the company? Well at this point, it's all legal mumbo jumbo and far beyond my expertise, but who knows, it could prove interesting..
Assuming You are going to stop paying the mortgage in the near future they'll just pick up Your credit deal, see who signed it, obtain a "bankowy tytul egzekucyjny" against this person and move on from there.
Hence I don't see why what I quoted above is relevant to the case.
5)
It's a shame really, the entire idea from the outset was to establish the company as a Holding Co for these and other assets, and for all the mortgages to be arranged in the company's name. But in the rush to get everything finished up on time, it just didn't get done that way. Imagine if it had - I suspect we would be having a very different discussion now.
Indeed we would be. I run my stuff on ltd's and it has to yet bite me in the ass.
6)
A word of warning - if the bank manages to use the European Arrest Warrant system against you (as they have been doing!) - then you'll find yourself persona non grata not only in Poland, but in most of Europe too. They can and will use the system against you.
European Arrest Warrant?
For not paying his mortgage?
Don't scare the guy, he really has enough problems already.
The only way the bank could get the Polish prosecutor involved in such a case would be if they could prove that the guy:
a) Used fraud to obtain credit --> not gonna happen,
b) Was never going to pay back his credit --> impossible, since he has made mortgage payments already,
c) Created and then caused insolvency to an ltd or a stock company in order to fcuk the creditors --> not applicable in this case.
Can't see any other possibilities.
So let's not get things mixed up here, this is a civil/commercial case, not a criminal case.
I understand some of You guys might think he's a "real estate speculator" responsible for the rapid growth of property prices in Poland or some other crap, but let's stay on the ground here.
No European Arrest Warrant will be issued.
