Landlord is behind on mortgage

voytovdwiof

Hi,

A letter arrived at the property a few days ago and I took it to the estate agents, they opened it and left it out in clear view so I "accidentally" read it.

The letter was addressed to the landlord and states the mortgage has multiple outstanding payments (arrears) and they are sending someone out to the property to talk with the owner and that this will incur a charge. Seems they are thousands behind on the mortgage, multiple letters have arrived in the past but I've just handed them on.

Does this mean that they are a) unaware he is letting out the property (is this fraud?) b) potential to repossess the property?

I have just renewed my contract for 6 months rental so not sure what to do.

Gwhiz

It looks like they may not know about renting that's for sure.

If I was you I'd start thinking of moving.

taxsaver

Yes, it seems certain that they do not know that it's been let (but I don't believe it can be considered fraud). Yes, they are very likely to start to move toward repossession in the near future. However, the lender will have to give you at least two months notice to vacate and I think might be bound by the six month fixed term.... but I'm not sure on this last point.

paddyrg

Looks like you may be moving soon one way or another - see if you can use the advance notice as a chance to look around things and if you see a bargain maybe have a word with the agent on the quiet that you know the position and may want to jump suddenly if there's going to be trouble...

GAH

Heres a little bit of advice below, if the house is going to be repossessed you don't have many rights as a tenant.

If your landlord has a residential mortgage, any tenants in the property will be unauthorised unless the lender subsequently consents to the property being let. These tenants will have even less protection from repossession. If the property is repossessed the lender will not need a possession order to evict the tenants as they are not lawfully in the property. If the tenants refuse to leave, the lender may be able to evict them as trespassers, which can be done through the court in a matter of days. Any unauthorised tenant who learns that a possession order has been made should immediately start looking for alternative accommodation.

dancingfairy

I don't believe that's actually the case.
I would contact Shelter in the first instance to find out where you do stand but I was under the impression that lenders had to give tenants the required notice (2 months) once they are made aware that there are tenants in there.
It is however highly likely that you will end up leaving so I would start saving and looking around now. You may need to withold the rent but this is not something I'd do without talking it through with Shelter first.
Also is your deposit protected? if not then it looks like things are shaky and you are les likely to get it back - particularly if your LL goes bust - sorry
df

voytovdwiof

I rent through an estate agent, my deposit is protected (I have the certification here) and I'm financially secure enough I can move with a days notice if needed, however it'll be an annoyance finding a property I assume.

Thanks for the information all, I'll start considering this outcome... how the landlord has managed to get behind on his mortgage is beyond me, I pay a reasonable amount rent that should cover most mortgages (this property would cost no more than £60,000 to buy) and I'm always on time, he must have an expensive drug problem or something.

may_fair

Quoting from the Painsmith legal blog:

"The Dwelling Houses (Execution of Possession Orders by Mortgagees) Regulations 2010 requires that the mortgagee gives notice at the time they apply for a Warrant of Execution to instruct the County Court bailiff to enforce a possession order. When doing so they must also send a notice to the property by first class post or by hand delivery or personal service addressed either to the tenant in their own name or to “The Tenant or Occupier”. The form of this notice is set out in detail and it specifies all the details of the Court who will be dealing with the matter and the details of the mortgagee who is seeking possession. It also spells out the tenant’s new rights under the Act* to ask for a stay of 2 months in the execution of the warrant and the process by which this is to be done."

This applies to tenants whose tenancies were not authorised by a mortgage lender.

*Mortgage Repossession (Protection of Tenants etc) Act 2010

bruciebounus

voytovdwiof wrote: »

Hi,

A letter arrived at the property a few days ago and I took it to the estate agents, they opened it and left it out in clear view so I "accidentally" read it.

The letter was addressed to the landlord and states the mortgage has multiple outstanding payments (arrears) and they are sending someone out to the property to talk with the owner and that this will incur a charge. Seems they are thousands behind on the mortgage, multiple letters have arrived in the past but I've just handed them on.

Does this mean that they are a) unaware he is letting out the property (is this fraud?) b) potential to repossess the property?

I have just renewed my contract for 6 months rental so not sure what to do.

If you can find out who is starting the repossesion proceedings, get in contact with them, and they should be able to keep you in the loop- not give you any confidential info, but let you know if the house is going to be reposessed or not.

We had something similar last November. However they knew the property had tenants in it, so the bank wrote to us to let us know that the house may be repossessed.

In the end it went to court and landlady agreed with the bank a repayment plan so she wouldn't lose the house. Apparently they usually try to do this in the first instance.

I'd suggest you go to the Citizens Advice Bureau, as they were very helpful to us when we were in this situation.

franklee

Links to more info on the Mortgage Repossessions (Protection of Tenants etc) Act 2010, including the Department for Communities and Local Government guidance, from the sticky thread here:

http://forums.moneysavingexpert.com/showpost.php?p=42187220&postcount=407

SouthCoast

And advice from Shelter can be found here:

http://england.shelter.org.uk/get_advice/repossession/repossession_by_a_landlords_lender