Walking away from a mortgage!

££sc££ · 10 November 2010 at 7:17PM

Hi Jonathon,

I thnk many have missed the shared ownership part of your post. The vast majority of shared ownership properties have a 'Mortgagee Protection Clause' within the lease, if they were based on the government template lease, and many lenders won't lend on shared ownerhsip without it. The following response is based on the assumption there's a MPC in your lease.

If you default on your mortgage and it ends up being repossesed, there's a few things that may happen, the freeholder (a Housing association?) will buy back the property by paying off the mortgage outstanding, up to 12 months interest and other charges assocaited with the repossession to the lender. They can then do with it as they will, sell on, resell for s/o or rent out. They would do this as damage limitation because they know that if the lender sold your share at auction for a tuppance, the HA would be hit my a massive MPC claim from the lender, where the HA will have to pay off any shortfall and other costs.

So, in answer to your question, you'd get away with it, you wouldn't be chased for the shortfall becuase the HA would have to clear it.

However, working for a HA it makes me so cross that so many shared owners are walking away scott free costing the trust so many hundreds of thousands of pounds now (although this is slightly buffered by grant money). And apart from this small amount of grant to develop homes, the organsiation is entirely funded by our tenant's rent money. And who are our tenants?...social tenants, the poorest members of society, over 2/3rds of our tenants are disabled. Personally, I couldn't live with that on my conscience.

Write to the HA saying you know it says you can't sublet in your lease, but lots of HAs are bringing in policies to allow shared owners to sublet for a fixed period, in exceptional circs. Hopefully they'll agree, as thye'll be frightened by another MPC claim.

And please don't just jump on a plane!

jonathan75 · 10 November 2010 at 9:41PM

Thankyou, what a great reply! My actually intension was to put it on the market , at the beggining of next year then wait and see what happens! If I did go down the other route, which since posting the comment, has drawn up some very interesting replies, replies I would have expected if I was leaving the country owning millions of pounds! My debt to this country, should it happen! will be like a drop in the ocean compared to the cost of the clean up today, due to the rioting students in london, I could go on, so others maybe need to think before they type!! Anyway I appreciate your words of wisdom and advice , there are some sensible human beings on here, that think as I do!

jonathan75 · 10 November 2010 at 10:13PM

Thankyou, probably the best advice I could have wished for! My sole intention, is to avoid losses to both parties involved, meaning myself and the housing association. I fully agree with your comments regarding the work that housing associations do and that they are for no profit, benifitting the vunerable of society. I bought the property in 2007 at the height, just before the bust! the housing asociation itself only was able, due to criteria requirements for tennents, to sell about 20% of the properties on a shared ownership basis, after that they rented out the remaining properties at a very reduced rate, meaning that my expenditure to live here is far greater that the renting tennents. This obviously does aggravate me, like it has done to other shared ownership tennents as we were told that the properties were not for renting!! Since then the development has suffered, with regards to antisocial behaviour issues and disturbance due to renting tennents!

Anyway I could go on! I have actually spoken to the association and yes, it was mentioned to me that I could possibly let out my property due to my circumstances, enabling me to pay the rent and mortgage, I have also mentioned that that the association could let out the property themselves, to provide the rental income while I pay the mortgage part. I have also enquired about them purchasing the property back, at a reduced rate, some 20% less than the originally purchase price, but was told they have no funds available at this present time to do this! My sole aim , is not to just jump on a plane but to resolve this matter reasonably, reducing the losses to either parties!

Advise greatly appreciated

Jonathan

jonathan75 · 10 November 2010 at 10:35PM

Hi, yes it does seem rather a randon message board, full of strange individuals that are unable to actually "read" the post fully before making a sensible reply, as they would know if they had read the shared ownership part! which possibly changes this a little! I've just read one comment slating another person that replied to my initial post, some people need to get a life and be more proactive with there time!!

As mentioned my aim is to be resposible and the limit my losses and losses to others and not walk away,,as I am of a certain intelligence and aware that such actions could effect my future should I emmigrate! and not just plane stupid!

Comments and advice appreciated anyway, and is something that I have planned to do regarding CAB.

Jonathan

jonathan75 · 10 November 2010 at 10:44PM

He didn't actually advise maxing out credit cards! please read the comments properly before replying! remember.......sarcasum is the lowest form of wit!! If your angry, then go for a walk to clear you head and stop with this poor old tax payers b*****t! I'm fed up with paying higher and higher insurance premuims year upon year due to knob head drivers and no win no fee solicitors, but hey........ thats life!!

jonathan75 · 10 November 2010 at 10:50PM

I like your thinking Sibley, actually my girlfriend is from Thailand, who lives in Auz, rather soppy I know.................. but all I've done, is fall in love with her, hence the reason for emmigration!

shortchanged_2 · 11 November 2010 at 10:49AM

jonathan75 wrote: »

Thankyou, what a great reply! My actually intension was to put it on the market , at the beggining of next year then wait and see what happens! If I did go down the other route, which since posting the comment, has drawn up some very interesting replies, replies I would have expected if I was leaving the country owning millions of pounds! My debt to this country, should it happen! will be like a drop in the ocean compared to the cost of the clean up today, due to the rioting students in london, I could go on, so others maybe need to think before they type!! Anyway I appreciate your words of wisdom and advice , there are some sensible human beings on here, that think as I do!

It still doesn't justify what you want to do.

bendix · 11 November 2010 at 2:09PM

Sibley wrote: »

You are not the only one glad our paths never cross.

I didn't fail in UK. That's why I managed to get this position in Bangkok. I think there were over 1000 over applicants.

I'm not scraping an existence either. I'm not rich but not doing bad.

You seem to be under the false impression that you are better than everyone else.

For me, you are the type I dislike the most. You've gone native.

If you could be bothered to learn how to speak Thai you would discover your wife hates your guys really.

I'm shallow but I see Thailand for what it is. Fun and I enjoy it.

If you want to think you are your situation are better or different from everyone elses then crack on.

By the way. Is your Thai wife the same age as you and fat?

Thought not.

You are the same as me. :rotfl:

From previous posts, we've already ascertained what your income is. It's hardly an expat income; you're hired on a local salary.

I'm confused. You say I've gone native but then suggest I take the effort to learn Thai so I know what my wife thinks of me.

I speak Thai fluently, but I don't need to use it around the house because my wife - being educated in a university and not a gogo bar - speaks fluent English too.

She owns land, her own property, and have multiple millions of baht saved in her own name in bonds and shares. She doesnt need me.

Does she hate my guts? I don't know. I'll ask her tonight.