Voluntary Repo without Bankruptcy

gimmiesomemoneypls

Hi

I have a property I lived in for about 6 years with my OH and 2 kids.
The house was quite far away from...well anything! so we decided to put it on the market and try to move to our nearby city where all our friends and family are also living.

So we put the house on the market and waited, and waited, and waited some more, then about a year later we decided to try and rent the house out and move into rented accomodation in the nearby city.

So we put it up for rent, but by this time (Aug 08) our son was about to start big school and our daughter was about to start little school so we decided to move in with family in the area we wanted to move to and get the kids all sorted and settled. It took about 3 mths before we had a tenant but we survived the wait living parents again.

We have now moved in to our new rented house and were just settling in when the tenent decided he could not afford the rent he was paying to us and left! OMG now we have to find £575 rent and £750 mortgage aswell as all the other bills and food etc...

I am not on a bad wage and my wife is now working pretty much full time but we still can't afford this, plus we were only getting £450 after EA fees rent from the house so we still have to find nearly £300 per month on top of our rent to pay the mortgage. We would like to be a little better off as we don't seem to have any money at all after all the outgoings have gone out, in fact if I blink I would not even know my salary has gone into my bank account.

We have now got my house back on the market for rent, but we feel we just want to get rid of it now and the prospect of £750 arrears next month is quite daunting. We have not had any interest in the past year for buying our propery so selling doesn't even seem too appealing, plus we would probably not have anything left after EA fees and Mortgage penalties anyway.

We have recently been thinking about VR and have been trawling though numerous posts on this website including Scarlets Diary but every ones circumstance is different, so we thought we would post a new thread of our own.

Our main concern at the moment is whether we would be liable for any shortfall as we think the house would probably sell for less than we owe.

We read a post saying you should not be liable for this but it was in refence to someone also applying for Bankruptcy which we want to try and steer away from if possible.

Can anyone help?

saveallmymoney

You will be liable, but if you bought it six years ago there will be some equity in it. Cut the price and get rid before it drags you down.

tigerfeet2006

Yes you will be liable for any shortfall between the final sale price and the mortgage. The mortgage company can chase you for the arrears for up to 12 years (though in some cases it is only 6 years.)

Please ring one of the debt charities and talk to them about your situation. Links and no.'s in my sig.)

All the best.

nervousmother

Please be aware if they re-possess it they will sell at some stupidly low price that will leave you £1000's in debt. They have a duty of care to get the best possilbe price but it means nothing!
They sold our house, with fees missed mortgage payments and costs, we owed them massive £136k.
They do indeed have 12 years to come after you for the debt, it is common for them to come after a person after about 10 years, it gives the person time to get back on their feet and maybe build equity in another property, during the time 'you are left alone' they are well within their right to add on more fees and interest.
That was one of the major factors in our BR. rather it over now...

tomterm8

It is MUCH better to sell the house yourself, rather than allow a mortgage company to sell it if you possibly can.

Lensman_2

tomterm8 wrote: »

It is MUCH better to sell the house yourself, rather than allow a mortgage company to sell it if you possibly can.

Yes, true.

However, most mortgage companies will not let you sell for less than the outstanding debt. So you can't sell it yourself if you are in negative equity. In fact, it is probably putting off the inevitable to market it above a realistic value and it will end up costing you more in the long run.

tomterm8

The thing is, if you get an offer, and the bank refuses it and then sells the house for substantially less then you have established a compelling right of action against the bank.