Northern Rock Voluntary Repossession Letter

veersix

Hi,

I finally manned up and spoke to NR this week about handing my house back to them. I have now received the form they want me to sign. Reading through the forums as I have been, everyone screams don't sign anything, but if I don't the repossession will drag on for months and I shudder to think what kind of state the house will be in once the locals realise it is empty. The only bit that I think seems to cause problems, the Deed of Acknowledgement perhaps, is the paragraph that says:

"I/We understand that should sale proceeds be insufficient to pay off the total amount outstanding, Northern Rock and/or any Insurer Mortgage Indemnity Cover (if appropriate) reserve the right to pursue me to recover the shortfall."

To me this seems to say that if there is a shortfall, which there will be, they can pursue me for it, which they will whether I sign the form now or let the repossession drag out. When they pursue me for it, at that point I will be unable to pay the shortfall and plan on going IVA or BR, BR being the more likely option.

So, I don't really see that signing the forms now, as I'm not currently BR, is a problem. Am I missing something fundamental? I can see how it could a problem if I was already BR as they would pursue me for the shortfall post BR perhaps. I'd like to get the repossession over and done with as soon as possible really and signing the form seems to be the best way of doing that, but equally, I don't want to be always looking over my shoulder as it were

Thanks.

P.S. They said that the unsecured part of the mortgage would now become "unlinked" and the interest rate would go up by 6%-8%. This would have the effect of almost doubling the monthly payments :eek:

Richard_S

Hi veersix,

I can appreciate your reasons for wanting the property to be repossessed as quickly as possible, but signing those forms could well be something you'd live to regret. There doesn't seem to be any clear legal guidelines, but there have been a number of people who've posted on here that have signed the Deed of Acknowledgement and bitterly regretted it.

It's little comfort if you eventually win a legal battle after NR have continued to pursue you, regardless of bankruptcy, and made your life intolerable as a result.

Regards

Richard

So_Sad_Angel

I too have had that form & upon advice ,from several sources, have decided against signing it. I`m not Br either & although I have put the property up for sale I await N Rock to start proceedings....this has been going on since June08 so you can imagine how much stress it is causing.

Having said that I don`t want the risk of being chased for a hefty shortfall that may be outside BR at a later time.

Hope that makes sense.

Angiex

mr_&_mrs_2

How much money does putting the house up for sale invlove? Do you have to have that hip (whatever its called) in place before you put it up for sale???

We thought we could put ours up for sale whislt waiting for reppo...

Here we go again ,,, more thoughts and decisons lol

veersix

Yes, what you say makes a lot of sense. Like you I'm not BR yet, and I won't need to be, touch wood, until the shortfall becomes due. That's why I feel that signing it hasn't the same bad mojo attached to it as if I had signed it whilst BR.

NDL advised me to seek legal advice as they weren't really sure what advice to give I'm not really sure where to get that advice from and I certainly can't afford to pay for it. It's a shame we don't have any IP lawyers reading the boards :rolleyes:

veersix.

So_Sad_Angel

mr_&_mrs wrote: »

How much money does putting the house up for sale invlove? Do you have to have that hip (whatever its called) in place before you put it up for sale???

We thought we could put ours up for sale whislt waiting for reppo...

Here we go again ,,, more thoughts and decisons lol

Hi....costs me £100 estate agent costs if I pull out otherwise all fees from proceeds. I did have to check with 2nd charge SL people that they would allow this & they will.

HIP usually c£300 ...again this is off proceeds however if it goes to repo I guess I will have to pay this. I am prepared to take this chance & had several viewing already. My solicitor knows the whole story including co-owners BR already.

My whole situation is complicated but I could`nt just sit back & not do anything as the house has been empty since June!

veersix

mr_&_mrs wrote: »

How much money does putting the house up for sale invlove? Do you have to have that hip (whatever its called) in place before you put it up for sale???

We thought we could put ours up for sale whislt waiting for reppo...

Here we go again ,,, more thoughts and decisons lol

Every seller has to have a HIP now. They're not cheap either. My GF is selling her house and it's costing her around £400. The other costs you'd have would be the estate agents fees and conveyancing costs. These would come out of the sale proceeds. AIUI you'd also have to get your mortgage company to agree to let you sell the house at a lower value, if that was the case. I can't remember off the top of my head if you're in negative equity or not

I'd really love NR to get mine up for sale sooner rather than later. When the local vandals get wind that the house is empty, they'll have the windows in quicker than a flash, and as much as there's no love lost between this house and I, I hate to think of the sheer mindlessness of such an act. Also, on a purely selfish point, it'll be me that has to the foot the repair bill at the end of the day.

Lensman_2

Veersix.

How much time do you think you will actually save by signing? The time it takes to get a court date for repossession is the answer. Probably a month at most. Then the property will very likely sit for about 4 months while it is marketed and then finally sold at auction, regardless of you signing or not.

Nobody here can give a clear answer on what the implications of signing that deed are pre BR. So there is risk involved.

So essentially, you are risking the shortfall surviving BR to shorten the wait from 5 months to 4. You may be repenting that decision at your leisure for a very long time indeed.

Don't do it.

veersix

After careful consideration I've decided just to send them a recorded letter explaining that I am surrendering the property, along the lines of the letter they sent me, but missing out the "toxic" bits. I guess it'll just run its course then and if the house gets vandalised, so be it.

Would it be worth pointing out in my letter that the house stands a high chance of being vandalised?

Thanks for all the advice guys/gals.

Merry_Gentry

TBH Veersix, I think you are doing the best thing. That whole aknowledgement letter is such a minefield, and I decided not to sign it simply because I don't want to be the 'test case' to see if they can use it to get me to pay the shortfall! :eek:

Difficult though it might be, they may/may not be interested in whether the house is likely to get vandalised - make sure you lock up securely when you leave, and that's the best you can do.

Lensman_2

veersix wrote: »

After careful consideration I've decided just to send them a recorded letter explaining that I am surrendering the property, along the lines of the letter they sent me, but missing out the "toxic" bits. I guess it'll just run its course then and if the house gets vandalised, so be it.

Would it be worth pointing out in my letter that the house stands a high chance of being vandalised?

Thanks for all the advice guys/gals.

Definately. They will want to protect their investment as far as possible.

You can post the keys, but they will probably change the locks anyway.

Here is my letter - just to give you a start on yours. It is far too wordy and maybe a bit apologetic but the sructure was advised by a financial advisor from CAB. Please note the very careful wording in the 2nd to last last sentence... I therefore ask you to consider repossessing the property

I took the letter in and got a clerk to sign a copy for receipt.

The Manager
XXXX Bank
XX Lower Northam Road
Hedge End
Southampton
SO30 4XX

2nd Sept 2008

Dear Sir/Madam

Re: Mortgage; XXXXXXXXXXXXXXXXXXXX

It is with deep regret that I write to inform you that I can no longer make repayments on my mortgage.

You will be aware that my circumstances changed around March 2007, due to the closure of XXXX Ltd in Plymouth and my consequent redundancy. I had to relocate to Southampton in order to carry on my profession as Engineer in Lens manufacturing. I came to you at that time and described my circumstances, which had changed significantly from those I had in Plymouth. Critical among the changes were a drop in salary from about £XX,XXX to £XX,XXX and the necessity to obtain rented accommodation in Southampton while still paying the mortgage for the flat in Plymouth.

I informed you of the change in circumstance during a personal visit to the Hedge End branch in about April last year. Your branch personnel were very helpful in finding a way to restructure my XXXX loan and credit card accounts to reduce my monthly outgoings by about £500. Unfortunately this was turned down because I couldn’t afford it. I couldn’t afford the existing outgoings by £500 more! My faith in the XXXX bank system was consequently destroyed. I have, for this reason, not sought other options from yourself regarding the flat. Remortaging is not an option for me as I have already defaulted on two accounts with you, not that I could afford mortgage repayments on top of my current bills and rent anyway.

However, I placed the flat on the market when I moved in March 2007. During 6 months of marketing and despite a significant reduction in price (to £125,000) I had no offers. I therefore took it off the market in the hope that time would provide a better situation. I had another valuation recently from Mannsbridge & Balment in Plymouth who advised that £110,000 - £115,000 would expedite a quick sale and that £120,000 was a fair price for a longer marketing period. None of which would cover the mortgage and the expense of selling the flat.

During this time I have been making ends meet by selling off my assets. I now have no assets left to sell and I have no savings. I am still a long way short of being able to pay you and the flat management company (by about £700 a month). The flat is uninhabited.

I therefore ask you to consider repossessing the property.

Please note that I wish to correspond with you strictly by letter on this matter.

Yours Faithfully,



Lensman


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