bad debt and writing off

[odie1kanobe]

It depends as some bank will take a settlement.

In effect you owe €125k and have pretty much no chance of ever paying it as business idea hasn't worked. Bank may take €60k as full and final settlement which in effect means you give them €60k and debt is written off.

Known it to happen.

No point in Bankruptcy as get very little so better something than nothing.

[Christel]

It depends on the fine print of the agreement between the developer and the bank (and the quality of each's legal team).

Sometimes the developer can walk away clean. Most times they will have all their business assets and sometimes even their personal assets (particularly if they gave a personal guarentee on the loan, which was common) taken. Frequently they will have to file for bankruptcy, which means they will be barred from being the director of a company or taking a loan for 7 years. And they might even be forced to repay installments of the loan for life until either they die or the loan is paid back.

A man I know hung himself last Friday because of debt to RBS. 3 months ago he was a millionaire, by last Friday he was facing total ruin.

Very few developers will walk away from this crisis without pain.

I've together with others successfully appealed some developments in recent years. Developers ranged from local to international consortium. Will they now be happy about our actions?

I've also heard the rumour that developers are lobbying authorities that they refuse permission, because they had contracts to buy sites in case permission is given. Is that believable?