Bank repo's in VN

No idea on the legal situation, but I'm well aware that banks will try and hide these losses for as long as possible before declaring them.
There are numerous reasons for this, but not least because if they start to reposes all the properties that are currently in default, if you think the housing crisis is a mess in the west you have NO idea how bad it is here currently!

My girlfriend works in the lending sector of a bank. I asked her what happens when people default, she told me it can take up to three years for the bank to take ownership of the property as they have to go through the courts. They do put a caveat over the property to stop the owners from doing anything. But from the stories she has told me, government officials at the notary office can be paid off to make documents so as the owner can onsell the property without notifying it has a caveat over it. All banks are different, so different rules apply. From what I have heard from her, the system is a complete farce and anyone can be bought so as to conduct illegal transactions.

Budman,

It all depends on who he knows in the bank, the local police and the justice system; and how well he knows them.  If he knows no one, he would have been on the street, already.  But, typically, this is how it works:

Once the bank decides a property is in default, it initiates the repo paperworks with the local police.  The police will have a chat with the guy.  If nothing is resolved, they will send the case over to the court.  Again, the court will notify him; there will be some wheeling-and-dealing between them.  Finally, if nothing is done, a judge will hold a public announcement, ordering the Vietnamese version of the sheriff (So Thi Hanh An) to see that the guy vacates the property and it is turned over to the bank.  Without knowing anyone, this entire process would take 6 months.  Max.!

But, if he knows somebody, this becomes a very drawn out process, if any.  Like Laidbackbreak had mentioned, if he knows someone in the bank, it might not find his loan in default, at all.  Or, if he knows someone in the local police force, his case may get filed in the "need further investigation" drawer and won't see the light of day.  The same thing can take place over at the court:  if he knows someone there, his case may get placed in the "under investigation" basket.  Finally, in the hands of the "Vietnamese sheriffs," if he knows one of them, the case will sit it the "to be executed" file.

As you can see, things get very sticky, Budman.  But, generally, that is how the system works here.  I hope it helps.

Howie

Here in Florida, banks will move to take legal title, the not take action to evict the former owner if the property is valuable and the owner continues to keep it up. This is seen as benfecial to the bank. A couple bought a large house on a canal with Gulf access for $900,000 in 2005 and have lived in it since. In 2009 they quit making mortgage payments. The bank repossessed it and hung a 'for sale' sign out. The sign has been tehre ever since, as has the couple. Only this week did the house go on the auction bloc, with a starting bid of $275,000. It will probably go for $500K which will still be a loss for the bank.

The irony here is that had this been a typical middle class home, the family would have been dispossessed much earlier. So Vietnam is not the only place such things happen, though in the case cited there was an unstated benefit for the bank.

Wild_1 wrote:

Budman,

It all depends on who he knows in the bank, the local police and the justice system; and how well he knows them.  If he knows no one, he would have been on the street, already.  But, typically, this is how it works.

Once the bank decides a property is in default, it initiates the repo paperworks with the local police.  The police will have a chat with the guy.  If nothing is resolved, they will send the case over to the court.  Again, the court will notify him; there will be some wheeling-and-dealing between them.  Finally, if nothing is done, a judge will hold a public announcement, ordering the the Vietnamese version of the sheriff (So Thi Hanh An) to see that the guy vacates the property and it is t:lol:urned over to the bank.  Without knowing anyone, this entire process would take 6 months.  Max.!

But, if he knows somebody, this becomes a very drawn out process, if any.  Like Laidbackbreak had mentioned, if he knows someone in the bank, it might not find his loan in default, at all.  Or, if he knows someone in the local police force, his case may get filed in the "need further investigation" drawer.  The same thing can take place over at the court:  if he knows someone there, his case may get placed in the "under investigation" basket.  Finally, in the hands of the "Vietnamese sheriffs," if he knows one of them, the case will sit it the "to be executed" file.

As you can see, things get very sticky, Budman.  But, generally, that is how the system works here.  I hope it helps.

Howie

Question: Howie, what are you doing in Vietnam?!?

1 "add-on": my friend who works for a private bank will find her connection to introduce to the property's owner for selling with a better price in order to get commission - you may know that the bank may only lend an amoun out of 70% the value of the property. When the price going up, re-sale the property can make up the interests of the bank's loan. Hey, are we only talking about the real-estate?

Aibiet wrote:

Howie, what are you doing in Vietnam?!? lol

I make ends meet, young woman. 

I thought it was up to 80%?  And Vietnamese properties are not going up, any time soon.  Vietnamese banks are in crisis because of their poor lending practices.

A friend of mine just called and told me that his bank is cutting its workforce by half, and among those who remain, salaries are being reduced in half as well.

Hopefully, Vietnam, especially the financial sector, will learn something from this.

Wild_1 wrote:

Aibiet wrote:

Howie, what are you doing in Vietnam?!? lol

I make ends meet, young woman. 

I thought it was up to 80%?  And Vietnamese properties are not going up, any time soon.  Vietnamese banks are in crisis because of their poor lending practices.

A friend of mine just called and told me that his bank is cutting its workforce by half, and among those who remain, salaries are being reduced in half as well.

Hopefully, Vietnam, especially the financial sector, will learn something from this.

I will take "young woman" as a compliment and I trust that you must be a very smart guy

Well, Sacombank met that problem and many local banks are stuck with its own development in the complex financial sectors, especially after the crisis. Not sure the Vietnam market can cover after 3 years or can be worse

95% of the Vietnamese bad debt went into the hands of Party members or their families and friends.  The loan amount was divided among them, including those in the banks.  Then, the actual debtors skip town; and everyone pretends to be angry at them.

A couple of year back, I thought about starting a debt collection business in Vietnam.  But, after talking to the local authorities, who weren't all too sure about granting me the legal powers I wanted, I had to put that on hold. 

Maybe...  During Tet, I should pay a visit to those same people again.

Wild_1 wrote:

Aibiet wrote:

Howie, what are you doing in Vietnam?!? lol

I make ends meet, young woman. 

I thought it was up to 80%?  And Vietnamese properties are not going up, any time soon.  Vietnamese banks are in crisis because of their poor lending practices.

A friend of mine just called and told me that his bank is cutting its workforce by half, and among those who remain, salaries are being reduced in half as well.

Hopefully, Vietnam, especially the financial sector, will learn something from this.

It doesn't help when top bank executives also stole a ton of money and do other shenanigans .

http://www.thanhniennews.com/index/page … ndals.aspx
For some reason, the newspapers always publish pictures of this chairman like he's some overcooked pig. 

http://www.thanhniennews.com/index/page … -scam.aspx

And this is only two stories I've recalled off the top of my head.  Many more but you get the point.  The falling economy has uncovered alot of shady dealings.

Wild_1 wrote:

95% of the Vietnamese bad debt went into the hands of Party members or their families and friends.  The loan amount was divided among them, including those in the banks.  Then, the actual debtors skip town; and everyone pretend to be angry at him.

A couple of year back, I thought about starting a debt collection business in Vietnam.  But, after talking to the local authorities, who weren't all to sure about granting me legal powers I wanted, I had to put that on hold. 

Maybe...  During Tet, I should pay a visit to those same people again.

There's already a State Owned Corporation that was just set up to buy bad debts from banks.  Where the bad debt goes....probably just magically disappears.  Or the government prints money to take care of it.  So we should see inflation continue.

Wild_1 wrote:

95% of the Vietnamese bad debt went into the hands of Party members or their families and friends.  The loan amount was divided among them, including those in the banks.  Then, the actual debtors skip town; and everyone pretend to be angry at him.

A couple of year back, I thought about starting a debt collection business in Vietnam.  But, after talking to the local authorities, who weren't all to sure about granting me legal powers I wanted, I had to put that on hold. 

Maybe...  During Tet, I should pay a visit to those same people again.

Collecting debt is still restricted business activities tho in practice you can easily get some "local mafia" to collect debts

I am sure you know well that you must pay a visit together with "Tet gift" - it does not need to be big but indeed need to be "valuable" good luck with the visit the 

No worry...  I will just give them one of those offers that they "can not refuse," yeah???

Wild_1 wrote:

No worry...  I will just give them one of those offers that they "can not refuse," yeah???

"can't refuse" and you gotta say it using a low deep voice with minimal cheek movement.

aibiet150204 wrote:

Wild_1 wrote:

Maybe...  During Tet, I should pay a visit to those same people again.

Collecting debt is still restricted business activities tho in practice you can easily get some "local mafia" to collect debts

I am sure you know well that you must pay a visit together with "Tet gift" - it does not need to be big but indeed need to be "valuable" good luck with the visit the 

Take your friendly local District Cong An Commander and his wife /gf out for nice dinner somewhere - he can find you some available 'gentlemen' to fix things, to your satisfaction, for a very reasonable price.  Private matters only - not fallings out with your bank

I still prefer the Homer Simpson way...