Husband wants off a 4-way-mortgage!? Very complicated please help.

whitewing

I was wondering how old you are, it's just nice to get some background. You are very determined which is good and you also have your whole life ahead of you which is even better. Stay focused but don't push too hard; baby is going to take a lot of 'being in the present' for the first few months so youCongratulations may need to be flexible so life doesn't get too much more complicated too quickly. I meant to say 'congratulations' before!

scoobyfamily

Had a "sit down conversation" with them and this is where things stand.

It was recently changed to interest only because they can no longer afford to meet payments otherwise.

She wants us to get a "second home" and declare we are not living in it, although actually live in it!:eek:


As it stands the sister and mother are both their company directors so pay a minimal payslip monthly and take out dividends, therefore not showing as they actually earn much. This is where the problem lies for removing my Husbands name. They can't prove they can afford it.

Spoke to the mortgage company who said in order for him to remove his name from the mortgage the family have to call up and have their earnings reviewed before they would say yes or no. I asked, "so what if it shows at this time they can't afford it?", they said, "well then we won't remove him and no other mortgage company would allow this either if they tried to switch and then do it".

So today this was all mentioned to his sister along with the fact that although both of our credit reports and checks show a current "999" rating we can't get a loan to lower the finance payment on Husbands car. Car finance rate is currently 12.9% which of course could be reduced. I have a family member who work in the bank and when the loan of £5,000 was rejected she was able to tell us that this was because of "affordability" i.e. the mortgage eating all his credit! I mean, only £5,000!!! What a joke.

She continues to state that he should still be able to get a mortgage as she has 2. She doesn't seem to get the fact that two independent mortgage brokers have said no chance.

He is on a salary of around £25,000 but at the time the mortgage was submitted it was only £17,500. So you can imagine what finance companies think when they see £400,000 against his name on a joint mortgage.

So the end result was:
Outstanding debt: £409,000 interest only mortgage.
The sister and mother have loans of £30,000 secured on the house also and was apparently taken out in order to put down on the house in the first place, along with a deposit from their previous houses profit.

Mother pay slip: £2,000
Sister pay slips: £780
Dad: approx £1,300

Husband: does not pay towards property.

They have said the house won't fetch what they need to cover what they had taken out for it.
Zoopla estimates: £397,685

But there is a major factor and that is that the house is a mess inside and decor has not been changed or renewed in the whole time they've been there. So there are carpets and flooring needing renewed.

Sister said today she will not make it easy for us and that he made his bed when he originally signed for it so now he can lie in it.

Senior_Paper_Monitor

Miss Scooby - welcome back (shame about the circumsatnces).

I and a couple of others put quite a bit of time into this before - in my case, and I suspect in others, because I was pretty horrified (accepting the information given - and I have reason to doubt it) by what the family (presumably led by the nose by the sister) has done and impressed by your clear thinking.

I still feel the same, not sure I can help (and I suspect that the best I will do is identify a suitable solicitor if you can fund it) but I will read through tomorrow or Monday (I spend Sunday morning tramping the fields with a longbow which tends to lead to 'a few beers' and your matter deserves some sober consideration) and see what I can suggest.

getmore4less

Depends what you want to do next, but I bet they are not HMO compliant.

Thing is you need to find out where all the money has gone,

Are there other properties that were funded from this equity release
How much has been used to support this business.

scoobyfamily

Thanks for your input, I really appreciate it.

We both know that from know on we'll have to go through solicitors but we really don't want to do that and have told them this. What's HMO compliant?

We have stated calmly that we want to reach an amicable solution that works for everyone and are willing to wait a few years to wait and see if the market helps the property value increase. Although the way things stand it's looking that the house needs to increase in value by about 40k and I'm very unsure this would happen in the next few years. We do not want my Husband to be landed with the negative equity to pay. They continually said we just care about ourselves and want to leave them, "in the !!!! with £30,000 loans to pay" and try to get another two separate houses (one for mum and dad)(one for sister, partner and child) as with no deposit and negative equity payments to make. But to be honest here, is this situation/scenario likely to be any different in the next 2 - 5 years?

I'm now due our baby between 2 - 4 weeks time and will definitely want to be buying a house by 5 years time at the latest - full stop. So it may well be that we have to force a sale through the court and they'll just have to take it on the chin that they need to make a loss and we'll need to make a monthly payment for the neg equity, just to get out of this deal.

Unfortunately things went very rock bottom yesterday and they proceeded to randomly bring up that we didn't make them feel welcome at our Wedding in June and we really upset them. So once this started to come out I said, "well if that how you feel then we'll see you later", and walked out. - because I wasn't letting them bad-mouth our Wedding or try to upset us causing us to act irrationally back. So I just decided to leave the situation as it was at and walked out.

getmore4less

HMO

Multiple occupation, by unrelated people

google is your friend here

there are licening and other rules that need to be followed


I think if this money has been used to fundother ventures then OH should be getting a share of the profits.

scoobyfamily

This is bad enough as it is and we don't want to cause more problems trying to gain money from places where there is probably no money left.

She said yesterday that she bought other houses to hopefully sell as a portfolio to pay off the mortgage in the long run. So hopefully a lawyer may suggest she sell her current properties to make up the difference for the loss on the property they would make. I've never ever been to a lawyer - I don't know how it works.

Rick62

Hi, not really sure where to start - so many issues here. Its a shame its so accrimonious, part of this is probably you 'interferring' in the family business, rather than your OH stepping up and dealing with it more assertively, however even then I suspect it would be the same, they are being very defensive as they are in the wrong.

What is their business - is it managing the properties? What was the £30k loan for? If I understand correctly there is a mortgage of about £400k, loan £30k on property that cost £460k and is now worth probably about 400k.

I would most probably not use a lawyer to sort out the dispute. First most lawyers are completely useless in any company/commercial/dispute area, in my personal experience, and would quickly rack up large fees. Second there are no agreements from what you have said, therefore nothing to enforce.

What you should do? First look at your position, it sounds like you are doing well with your business and most lenders will only require 3 years accounts rather than five. It would be worth taking advice on protecting your assets/credit rating from any potential problems from the OH family mortgage.

Then you should look to negotiate a proper agreement relating to the OH family house, mortgage, loan, other property investments etc with the sister (and parents). What is the share of profit and loss on the property, how is income from the investments dealt with etc, etc. If they are unwilling to negotiate properly then you could threaten lawyers, forcing sale etc, however try and keep it as a threat, the best result is likely to be whatever you can negotiate yourself.

Start by getting the full facts, including of sisters property empire - your husband has every right to demand this since effectively he's helped finance it.

Joyful

I feel for you. Is there any way that you can legally stop them taking out any more loans secured on the property? You certainly need to see all the paperwork and also whether the other properties bought will make a profit for only the Sister given that she used the equity from the house to buy them.

scoobyfamily

Rick62 wrote: »

Hi, not really sure where to start - so many issues here. Its a shame its so accrimonious, part of this is probably you 'interferring' in the family business, rather than your OH stepping up and dealing with it more assertively, however even then I suspect it would be the same, they are being very defensive as they are in the wrong.

I feel I have every right to interfere as this problem is preventing my Husband and I from having our own family home and will do for some time. I am trying to protect us as I'm more concerned about us as a family unit in the weeks to come, having no assets that are worth anything/ or ever being able to progress into a larger house through the property ladder. My Husband has not been overly-assertive in this situation due to not wanting to upset anyone.

Rick62 wrote: »

What is their business - is it managing the properties? What was the £30k loan for? If I understand correctly there is a mortgage of about £400k, loan £30k on property that cost £460k and is now worth probably about 400k.

Their business is a Nursery and have recently got another mortgage "2nd home mortgage" for another property to start-up another nursery business there. I believe this loan was initially taken out to cover the deposit required for the house, along with a cash amount from the profit of their old homes, so cannot give an accurate figure.

Rick62 wrote: »

It would be worth taking advice on protecting your assets/credit rating from any potential problems from the OH family mortgage.

How do I do protect this?

Rick62 wrote: »

Then you should look to negotiate a proper agreement relating to the OH family house, mortgage, loan, other property investments etc with the sister (and parents). What is the share of profit and loss on the property, how is income from the investments dealt with etc, etc. If they are unwilling to negotiate properly then you could threaten lawyers, forcing sale etc, however try and keep it as a threat, the best result is likely to be whatever you can negotiate yourself.

Negotiating a proper agreement is highly-unlikely as I've previously mentioned that the sister stated she "won't make it easy" for us and is completely unable to communicate in a calm manner. She will not listen and give a response - e.g. when mentioning to her that my Husband could not get a loan because of the mortgage she said it was lies. My Step-mother works in the bank we applied with and she was able to tell us the exact reason - yet when telling the sister this she also said it was lies and that my step-mother was lying just because the sister can obtain loads of credit cards, loans etc
I know we need the figures of shares etc but am unaware of how to obtain this - is it best my Husband contacts the mortgage company and asks what his share is?

Rick62 wrote: »

Start by getting the full facts, including of sisters property empire - your husband has every right to demand this since effectively he's helped finance it.

Treat me like an idiot here:rotfl:. What should we ask to know?

I think this is possibly best sent in a letter because otherwise we'll get a rapid fire shouting response which anyone would be unable to take in.