MSE News: Mortgage rescue scheme comes up short

poormummy_3

After 2 years of being ineligible to apply for the MRS, having to advise the CAB and council about the scheme etc... we were finally eligible, applied, got accepted and our completion date on the house sale is Monday.

BUT!!!...
I've now got some questions and literally no-one seems to have the answers. We were offered a 3 year tenancy with the local housing association - but what happens at the end of the 3 years? Will we then have to move? Will we still pay 80% of market rates? Will we be long-term housing association tenants or given another short tenancy?

I have been able to find out that we will not be able to exchange or transfer to a bigger house (eg. if we had triplets).

So... going through with the MRS means we have to pay 10% of the value of our house in return for a)not having to move b)secure home for 3 years. For us, it also means only getting £5k for our house, which is £7k short of being able to pay our debts, which we have no other means of paying.

If we were to sell privately, we may get £20k for our house meaning we could pay our debts, but would have to move house and have no security. We also only have 3 weeks of mortgage interest benefit payments to come, so would need to sell in that time.

My brain hurts. I can't think clearly about which route would be the least stressful as I just can't cope with any more stress. And I have very little time to decide.

Can anyone help?

poppy10_2

poormummy wrote: »

I've now got some questions and literally no-one seems to have the answers. We were offered a 3 year tenancy with the local housing association - but what happens at the end of the 3 years? Will we then have to move? Will we still pay 80% of market rates? Will we be long-term housing association tenants or given another short tenancy?

You'll be put on an Assured Shorthold tenancy - after the three year period you could theoretically be served notice to quit but it's unlikely that the housing association will kick you out if you have been keeping up with the rent payments and the other requirements of your contract. Rent will be subject to review following the expiry of the original contract term.

poormummy_3

It just seems like I have to pay a lot of money for the MRS and still get little security by not knowing what will happen after 3 years.

purepink

Does anyone know how long an application for MRS takes, please? My OH has been trying to get a 'clean break' from his ex-wife for years now. She landed him with most of the joint debt (he was the breadwinner, so he signed for their loan for a new kitchen, car etc and then when they split up, it became 'his' debt). After struggling for years to pay everything off himself and becoming ill in the process, he finally declared himself BR. (His debt was quite small by this point). His name was still on the joint mortgage. Went to court again last year for clean break, (now BR) when ex-wife declared she had applied for MRS. Neither my OH or the BR Trustee knew this! Judge deferred case for ANOTHER 12 months, pending the outcome of the MRS! OH is now discharged BR... and the deferred court case is coming up soon, but the MRS has not completed. Can it take 10+ months to process? OH is worried the judge might defer for ANOTHER 12 months and he just wants the 'clean break' so that he can move on. Thank you.

poppy10_2

poormummy wrote: »

It just seems like I have to pay a lot of money for the MRS and still get little security by not knowing what will happen after 3 years.

Most renters live with the possibility of being given two months notice to leave their homes - you are getting a three year deal guaranteed to be 20% below the local market rate for rents - hardly what I would call "little security."

The taxpayer has been paying your mortgage for the last two years. If you wanted the security of a home for life then you should have bought a house you could afford, and kept up with the mortgage payments. As it is you have been very lucky with the amount of support you have received from the government. Sorry to say it but you come across as incredibly ungrateful.

poormummy_3

How I am now in this situation is not up for discussion and I am not ungrateful - I have however been through hell trying to keep a roof over my family's head.

I am looking for advice on how best to move forward - whether to:

a. Pay £16k to sell to a housing association, stay in my house, save £5k on rent, remain in debt, and have no idea what will happen after 3 years, or

b. Sell privately, move house, pay off all debts, possibly be repossessed in the time it takes to sell

Any advice on which would be the best route?

marushkababy

Really good, helpful threads here for and against the MRS.