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The banks have also agreed to discount the amount owed on outstanding owner-occupier loans, with the government agreeing to top up the balance. Investors would not receive the same assistance under the proposal.
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The plan will mean those with big mortgages will end up debt-free, while those with smaller mortgages will have their loans paid off and be means-tested to see what further funds they should receive. Those over the age of 65 or who have a particular hardship will also be means-tested to see if they are entitled to an additional payment.
If the proposal passes, those who vote against it will be entitled to stay but will have to continue paying their mortgages and strata debts while negotiating with the new owners. All ongoing rental support for the displaced owners will cease in June.
Shelter NSW chief executive John Engeler has attended a series of emotional meetings with Chandler to represent the owners’ interests.
“This isn’t anyone’s Option A, but it’s the best of the Plan Bs, Cs and Xs,” Engeler said. “It’s an equitable response, but it’s not equal, as some people will do better than others. But this is a situation where a whole series of things went wrong by a number of different people and culminated in a complete catastrophe.”
Some owners are thrilled to have an end in sight, while others are angry the state government hasn’t stepped in to buy the building.
Mascot Towers residents Anthony Najafian, Treacy Sheehan, Alex Chan, outside the Mascot Tower apartments late last year.Credit: Dion Georgopoulos
“I think it’s a good arrangement,” said one owner, university lecturer Alex Chan. “I know we’ll lose some money but, at this stage, I don’t care. It’s like the Titanic is going down and when someone offers you a lifejacket, you don’t turn them away.
“It’s good the government has taken the initiative on making all the arrangements for a sale. If we did it … [we could] end up like this for another four to five years. This way, we can get out and get on with our lives.”
Another owner, Treacy Sheehan, who’s been diagnosed with brain tumours which she believes the stress has contributed to, was less certain.
“I don’t think anyone is winning with this deal. I think the government wants it to be over, but I don’t really know what to think about it yet,” she said.
Owners previously took legal action against the developer and builder J & B Elias – who later went into liquidation – for defects. They also settled another claim against Aland Developments, after cracks appeared after drilling work commenced on their neighbouring Peak Towers development.
Chandler says owners have to make up their minds about the way forward. “But this is the first time they’ve been given the opportunity to walk away,” he said. “The ball is now in their court.”
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