Should let my house become repossessed?

Polovski

This is a bit complicated and divorce related but this is the situation....

I am in the middle of a divorce, my husband has transferred property 1 into my sole name and i have a buy to let mortgage on it - it is tenanted. The mortgage is £480, life insurance £40 and insurance £20. I rent it for £550 so i only clear £10 a month on it!

Property 2 is the former matrimonial home. I continued to live there after he walked out but more recently was not able to continue to live there as the payments for bills, contribution to mortgage etc were proving too much. I am now living back home with my parents:eek:

The mortgage on that property 2 reached the end of it's 2 year fixed rate and has now jumped to the variable rate, this means a mortgage of £900 a month approx.:mad:

There is also a secured loan of £19k (we took this out not long before husband left and he cleared all his debts with it and bought a car which he still has:mad: ). The repayments on this are £190 per month.

The house is on the market but has little hope of making any more than is required to repay mortgage and loan.

In the meantime he is demanding that i pay 50% of the mortgage (£450)
I only earn £660 after tax a month.

I have been told by a few people (not professionals i might add) that i should just stop paying towards the mortgage and let it default and become repossessed. Originally he had agreed to let me have any equity in the property but as it looks like there won't be any then i am wondering what i should do.

Would allowing this property to become repossessed affect my other property? Could they also take that one and how would being repossessed affect my credit rating?

Any help or advice greatly appreciated

silvercar

Sell it yourself and clear the mortgage and loan.

Allowing it to be repossessed would affect your credit and your ability to get a mortgage in the future.

If there is a shortfall, the lender will chase you and your ex. They will go for whoever they think has money. If you have another property they could well go for a charging order on this property.

I would make clear to your ex that you can't afford the payments and that he needs to make the payments until the property is sold. Otherwise his credit rating will be stuffed, along with his ability to get a mortgage in the future.

dunstonh

The mortgage on that property 2 reached the end of it's 2 year fixed rate and has now jumped to the variable rate, this means a mortgage of £900 a month approx.:mad:

Interest rates are still pretty low (below long term averages). So, the increase shouldnt be an unexpectadly high amount. We are basically just below the average at the moment.

Would allowing this property to become repossessed affect my other property?

Possibly. If there is a shortfall in the lending being repaid (both mortgage and loan) then they can come after you for that shortfall. This could be in the form of demands, county court judgements and/or ballifs.

However, being repossessed is very expensive compared to a decision to sell up yourself and you will wreck your credit history for the next 6-10 years.

happybroker

could prop 2 not be let also if your OH walked out and you now lives at parents?

Polovski

happybroker wrote: »

could prop 2 not be let also if your OH walked out and you now lives at parents?

I had asked that in the beginning but he was unwilling to allow it thinking that it would leave the property unable to sell for a year lease - thing is that it is going to end up empty now for a considerable time anyway because of the market.

Honestly - he makes my blood boil.

He is living it up with his new partner and earns over £25k a year, has no debts because he duped me into the secured loan, then paid off all his debt and he also has a new car out of the loan that i am fighting for him to sell to clear some of the debts i was left with and am still making repayments on (£2000 on credit cards, £2500 overdraft).

Grrrrrr

cheers for replies folks - i figured repossession was a big deal in terms of creidt rating.:beer:

happybroker

it would be a big deal for him also, is he aware that this is what you are considering? Perhaps that may sway him on the letting issue a little!

Good luck, sorry to hear of your situation.

Toughluck

Polovski

Empathise with your situation I honestly do. look slike you got hte rough end of the stick.

If at all possible avoid repo, as silver car said the ability to attain mortgage sin the future will be much more difficult.

The only crumb of comfort by the sound of things is that if all mortgages you have are in joint names it will affect you both. As you are with parents plan to stay there for a while. If he is living the life again and his new partner wants to settle down and buy together he (and she) will be in for a massive shock on their ability to get a mortgage in the next few years.

Polovski

I think his new partner owns outright as some kind of settlement from her own divorce (she has 2 kids). My husband and her are now having a baby and he keeps telling me what he can and cannot afford - honest to god, you just wouldn't beleive it!!! Apparently she isn't entitled to maternity pay - and then i am supposed to feel sorry for them?????

rough end of the stick indeed lol

Toughluck

As I said Polovski, if you wanted to make life very very difficult for him you know what to do with regard to his credit history (will apply to you also though).

I do wish you all the bestxx