Giving my house back to the bank?

ruben_sen

My partner has been given a Job offer down under and we really want to take it. We have put the house for Sale but in the current climate we have had no interest. It is a simple 2 up 2 down in West Yorkshire. A family member mentioned a idea of giving the house back to the bank? Is there anybody out there who could advise if this is possible and what the repecussions of doing this is?

We only brough the house 3 years ago and have invested a little extra in improvments. We are worried about asking the bank direct at this point incase it looks bad/ raises sus!!!!ions. So any help at this research stage would be good.

Thanks

R

_bankrupted

In a word NO..

The Bank does not own your house and rent it to you via a mortgage, like others would like to suggest. The bank merley has a charge over the property and this means in the event that you default on the mortgage, they can get a court order to evict you and sell the property to recoup their loan.

In event of difficulties the bank would try to negotiate with you to find a solution to the problems of paying the mortgage. Giving you a payment break, moving to interest only etc would be some solutions.

But your situation is different, you want to move on and discard the responsibilty of the property.

If you were to hand the keys back and leave the UK, the bank would sell the property at auction. This could mean selling it for half of what it's worth today. They would then seek the remaining balance of the mortgage from you. If you have left the UK, they probably won't do anything. If you ever decide to return you may find that your past catches up with you when you least expect it...

PasturesNew

As said above: NO.

You borrowed money. You have a loan. The bank happen to have their security in the fact they can take the house off you and sell it if you don't keep up the payments.

If you "hand it back", they'll toss it into any old/next auction and take what they can for it. "Oh well" they'll say "we tried our best, but it was a bad time". And then they will chase you for the difference between what they got at auction + auction costs + legal costs + interest not paid during those months + the cost of anything else they can put on your bill.

Oh ... and they can (and will) chase you for YEARS. Depending on the lender it would be a minimum of 6 years, possibly 12 years. You might hear nothing, then 1 day before the 12 years is up you get a letter ... and over all that time they'll have continued to add interest onto the amount you owed each month.

Check it out. I'm not making this up.

geoffky

please do not do this as it is financial suicide..they will chase you for the shortfall and it will be a lot of money..you need to really plan this one out but doing a runner is not a option unless you change your names when you get there;)

clutton_2

why not put it into auction and sell it quickly that way

silvercar

Could you rent it out while you are away?

What is the house really worth and how big is the mortgage?

How long do you intend staying in Australia? If you intend going there for good then handing the keys back could work for you.

Snooze

PasturesNew wrote: »

Oh ... and they can (and will) chase you for YEARS. Depending on the lender it would be a minimum of 6 years, possibly 12 years. You might hear nothing, then 1 day before the 12 years is up you get a letter ... and over all that time they'll have continued to add interest onto the amount you owed each month.

Check it out. I'm not making this up.

I think you've got a little over-excited PN !!

The maximum is 6 years. After that they legally cannot do anything.

In answer to the OP, there's nothing to stop you walking away but your UK credit file will be toast for 6 years and the bank will also be chasing you for the difference between what it sold at auction for and what you owe them (again, only for 6 years though).

If you're not planning on returning to the UK in that time then if it was me I would do it. The only thing you need to remember if you do this is not to open a bank account in Oz with the same bank (or group of banks) that your UK one was with as there's a high risk of them catching up with you.

(And no, I'm not interested in anyone's opinions on the rights and wrongs of doing this so don't even bother).

Rob

mjdh1957

Snooze wrote: »

The maximum is 6 years. After that they legally cannot do anything.

Rob

I think for mortgage debt the limit is 12 years, not six.

carpetbelly

For mortgages I do believe they can chase you for 12yrs actually. But who knows the legaility of chasing abroad for debts. I personally don't think they can, even if you end up banking with the same banking group. Data sharing between countries hasn't been agreed and I'm not sure of the legalities of that part.

iolanthe07

The maximum is 6 years

It is definitely 12 years for a mortgage.

sdooley

Statue of limitations for deeds is 12 years (though a mortgage does not have to be by way of deed).