Giving the keys back & Mortgages

[MelanieGiles]

Julian

One of the problems constantly encountered with people trying to sell their properties where there is negative equity to a second chargeholder, is trying to get the second chargeholder to agree - and ultimately they do have to agree to release their charge upon a sale, or good title cannot be passed. What advice can you give on this particular point?

And I have dealt with many bankruptcies where there are mortgage shortfall debts - in my experience lenders always prove!

Regards, Melanie Giles, Insolvency Practitioner for over 20 years.

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[Adam Davies]

Hi Julian
I think that you have mis-read my post
Wen will be declaring bankruptcy so any shortfall resulting from the house sale/repossesion WILL be covered in the bankruptcy,surely ?
Regards

Andy Davie
IVA.co.uk Spokesperson

About me:
http://www.iva.co.uk/andy_davie_profile.asp

IVA Helpline: 0800 197 4838
http://www.iva.co.uk/iva_helpline.asp

[wen]

So, is Andy correct in saying that any charges etc, that are owed to Welcome or the mortgage company will be written off in bankruptcy or is this not the case?

[jane.l]

Well, bit of an update on my nightmare situation

We thought our house had been repossessed as we got a Order for Possession through the post from the Court saying we had to vacate the house on 29 August (we had already moved to rented by then) I thought the house had been repossessed so we then went bankrupt on 30 August, I have since found out that the house has not been repossessed and Nrock are still chasing us for £6,500 mortgage arrears! I have explained to them that we are bankrupt and do not intend to keep the house as its in negative equity. I rang the OR (OR said we are NOT liable for any shortfall to either Nrock or the secured loan company, no matter when the house sells) and they have been in touch with Nrock, but I am still being chased for these arrears!

I am so sick of them!

I have been told by OR that we are NOT liable for any shortfalls or selling costs, that has put my mind at rest, so now I am just ignoring NRocks demands for payment

[wen]

Jane, sorry to hear of your situation. At least your OR has put your mind at rest with regards to you owing nothing... I suppose it's a case of letting NR waste their resources contacting you!! I would have thought that once your OR has spoken to NR that they'll stop as there is no way they will get a penny!

[jane.l]

Yes, I have just edited my post to say, my mind has been put at rest by the OR!

I have written to NRock and rung them up but still they send me letters saying "as we have not had any contact from you, blah, blah, blah!" Its sooo annoying, so now I am not going to bother contacting them again. The last person I spoke to was useless and just told me "you will continue to be hassled until you pay!!

[Adam Davies]

Hi
Did you read the story of the person that was so fed up with BT,he was trying to cancel a service,that he posted a complaint on YOU TUBE and got a letter from the offices of the chairman within a few days and a refund.
Let's hope Jane that you don't have to go to these extremes
Regards

Andy Davie
IVA.co.uk Spokesperson

About me:
http://www.iva.co.uk/andy_davie_profile.asp

IVA Helpline: 0800 197 4838
http://www.iva.co.uk/iva_helpline.asp

[JulianSampson]

Thanks for all the posts/ queries....

Andy- yes I probably did mis-read your post. I assumed that you were referring to sale charges in a positive equity situation.

Melanie- thanks for the heads up. I would be interested to know if any of the traditional sub prime lenders prove or not? Can you name? You are right in so far as a voluntary sale could not proceed without the second chargeholder consenting or being repaid. However, if the Lender is allowed to take possession and act as mortgagee in possession or LPA Receiver then there is an argument that the second chargeholder is overreached by the first Lender and gets what they get (if anything). Handing over the keys for the lender to conduct the sale under their power of sale can therefore be an option to expedite this.

All- yes, any shortfall arising from a negative equity will fall as proveable in the bankruptcy simply because the creditor lender has now exhausted their charge on the security and must rank with the other unsecureds. In answer to you, Wen, the mortgage company will apply to the OR for recovery but they will have to accept whatever dividend the OR/ Trustee eventually pays.



Kind regards

Julian Sampson
Solicitor
Wright & Wright LLP
www.wrightandwright.com
See my article in Clean Slate magazine

[jane.l]

Just an update on my situation, I have noticed on the Land Registry search that the second charge, the secured loan, has been removed from our house, so I presume it is in readiness for "proper" repossession and sale???

If only they had let us sell the house at the beginning!

[JulianSampson]

Not necessarily- I would expect your second charge to have remained there notwithstanding you were in a repossession situation. Are you sure it was secured?

Kind regards

Julian Sampson
Solicitor
Wright & Wright LLP
www.wrightandwright.com
See my article in Clean Slate magazine

[jane.l]

Yes, the loan was secured, the charge was on the Land Registry and now it has been removed.

We tried to sell the house, we had found a cash buyer and had nearly got to exchange of contract stage but Picture Financial would not remove the charge and allow the sale.

[ray_a]

Hi Jane

Sorry to frighten you but experiences of people in the early 90's showed lenders going for people who expected the lender to sell their property.

To be double careful make sure tghat these costs are included in your creitors list for bankruptcy!!!!

Good Luck

[jane.l]

Yes, the OR has confirmed that everything is included. We are in no position to pay anything now anyway as we have hardly any surplus and we do not intend to ever buy a house again!