Re-Mortgage Query

Lloyd74

Hi, our dad passed away July 2009 and left a large mortgage which my mum and brother cannot afford. We are getting by with a little help from me (I have my own mortgage) but its tough going.

In a nutshell, my dad re-mortgaged in September 2008 which turned out to be a 6 figure sum. After dad's death we also found out that he had a significant number of credit cards and loans totalling 50k plus, going back before September 2008 and after.

At the time of the re-mortgage my dad was a self employed taxi driver aged 61 but what we cannot understand is how the building society could lend him such a huge amount of money at his age and the debts he had prior to getting the mortgage.

My mum's name is on the mortgage too but she only works part time and we were told that he couldn't get insurance on the mortgage because it was too expensive, probably due to his age and the current climate.

So my questions are:-

1) Should he have been sold the mortgage in the first place given his age and debts?

2) Is it now my mum's debt as her name is on the mortgage even though she never made any payments towards it.

3) Is there anyway we could get some of this debt written off i.e. my dad's half and then my mum can pay her half off?

4)How can we find out if the building society made all the correct checks prior to lending him such a huge amount of money?

We are all in a state of worry as you can imagine, we are barely coping with the loss of dad and now the building society have basically given us one option and that is to pay up.

Many thanks to anyone who takes the time to reply.

VIGILANT22

This is a very sensitive area and I do empathise with you however I think you may not find the answers you're looking for here

1. Being refused insurance because it is too expensive, who told you this?
2. Nobody on here can tell you whether the mortgage was correctly arranged, as this involves information none of us are privy to.
3.The mortgage was in joint names, so now your mother takes on the responsibility, this is the norm with any joint agreement.
4.You said he remortgaged in 2008 but when was the mortgage originally taken out
5. Was your mother never involved or present at the meetings when the mortgage or remortgage was arranged
6 Is it possible for one of you to accompany your mum to the BS & try and get some answers there

Lloyd74

My mum vaguely remembers dad saying that he couldn't afford insurance on the mortgage but where he tried to get it from we don't know.

We were also told by the building society that it is not compulsory for customers to take out insurance on their mortgage too.

We originally moved into the house in 1982 I think but how many times he re-mortgaged we do not know.

My mother was there with dad and the broker when the re-mortgage was arranged as I think they needed her signature but obviously the deal was left upto dad and she thought it was all OK.

We have been to the building society a number of times but in all honesty they have not shown much remorse or even been much help. They gave us a 6 month payment holiday which helped but then they charged interest on that period and that holiday ends this month.

We have been told we can pay the interest on the mortgage for a temporary period of time then we have to make the full payments after that. So in a nutshell they really havn't been that helpful, not that I was expecting them to be but they really havn't helped.

VIGILANT22

I asked when it was bought to clarify if no insurance had been arranged in 1982, it would have been much cheaper as parents would have been younger
Insurance is not compulsory, it is down to the individual/s to decide whether they want to take the risk or not.
The main problem is lack of insurance and this is little comfort but the amount of people who are in the same position because they see insurance too expensive or advisers trying to exploit them etc...Then sadly they have a situation as you do.
What is it exactly you want?

Lloyd74

We just want to know if the building society was right to lend him such a huge amount of money at his age and the debts he already had.

If they did all the checks then fine, I don't have a problem with that, but how do we find out what checks they did?

If they found out he already had debts of 50k plus would they still have leant him the money?

No wonder this country is in the state it is in.

VIGILANT22

Your mum could start by asking for a copy of the application to see what he has disclosed..but remember your mum has signed this application as being a true declaration..so you will have to be careful...She could write a letter about irresponsible lending to the BS....

You're not mentioning anything about the 50k, why are the BS "to blame"....what about the credit cards and loans....he had the mortgage long before them...so should they have given him more credit as a mortgage is the main priority

The main problem is all these liabilities were not covered. If an insurance policy had been in place nobody would have questioned "irresponsible lending"...I hope that doesn't sound to harsh but possibly true.

Lloyd74

Thanks for your replies, I am probably clutching at straws in my original post but if you don't ask then you will never know.

We will get by, it's going to be tough but we will manage it somehow.

The only other thing is that my mother is going to suffer a drop in income come August when her widow's pension stops and she can't claim her state pension until March 2011 but that matter is currently being looked into.

Oh well, that's life I suppose, nobody said it was easy.

Thanks for your help.

VIGILANT22

I wish I could have helped, it's really sad.....what is the future, sell the house?

Lloyd74

We don't know, we are going to try and make the payments for as long as we can but if it proves to be too expensive then we may have no option.

Even though I have a mortgage of my own I can contribute to the payments too. We are just going to see how far we can get. Hopefully we will be OK but it's going to be tough with a lot of sacrifices for the next few years or so.

Selling the house is a last resort.

VIGILANT22

why dont you see an adviser....it may be that if yr income stacks up and your brothers.....you can take out a new mortgage with a much longer term which will make this more affordable....good luck

Lloyd74

Cheers, we are looking at every single option at the minute.