Virgin Money (NR) - Repossession Shocker

EvilDoctorPorkChop

Hi all,

Just want to check something and wondered if you goood people would have an answer.

My sister is in negative equity on her property. Conservative estimate is that she purchased the house in 1995 for £90K and over the last decade has borrowed £200K (shocking I know) and the house is now only valued at £225 to £240k.

She claims she got a letter from Virgin Money (as a Northern Rock customer) saying that they are going to repossess the house in 8 weeks time. She also claims the CAB says there is nothing that can be done about it.

So I ask myself: Is she really having her home repossessed simply for being a high risk customer and not for being in arrears or anthing? Hmm all sounds a bit fishy.

Surely they can't just repossess within 8 weeks because a borrower is deemed high risk?

Please can anyone confirm this or blow my sisters deception out of the water? I need to confront her on this because my parents who live with her are having to go into rented accomodation and want me to be guarantor. I have a feeling they will move my sister in too (hoping I wont' notice) and I refuse to be a guarantor for someone who is incapable of managing their money and, worst of all lies, about it.

Please help me work out if I'm being overly suspisious or whether this is a common practice by lenders!!

BoGoF

There is no way they will reposess unless there are arrears and it takes many letters etc before it ever reaches that stage.

Thrugelmir

Sounds as if she has defaulted on the mortgage repayments. Allowed arrears to accumulate. At a guess buried her head in the sand and ignored addressing the issue.

So the NR would have grounds to apply to a court for repossession.

ACG

As above.
You cant just take something, if your sister was keeping up with the repayments as agreed they wouldnt be looking to repossess...why would they? Its more hassle for them and they would probably get less on an empty property.

Chances are your sister is probably atleast 3 months in arrears before she gets a letter like that.

dunstonh

So I ask myself: Is she really having her home repossessed simply for being a high risk customer and not for being in arrears or anthing? Hmm all sounds a bit fishy.

You are not getting the full story.

Lenders dont just suddenly do this and no court in the country would grant repossession on that basis. She has to have arrears and multiple months worth.

opinions4u

EvilDoctorPorkChop wrote: »

My sister is in negative equity on her property. Conservative estimate is that she purchased the house in 1995 for £90K and over the last decade has borrowed £200K (shocking I know) and the house is now only valued at £225 to £240k.

So look at your sister's lifestyle. If looks like she routinely borrows an average additional c£10,000 a year over an above what she earns and has been doing that since she got the house.

She claims she got a letter from Virgin Money (as a Northern Rock customer) saying that they are going to repossess the house in 8 weeks time. She also claims the CAB says there is nothing that can be done about it.

If she hasn't been paying the back this is quite likely. Again, look at her lifestyle. Look at how much her debts have increased year on year. Has her income increased at the same pace to make that ever increasing level of debt affordable?

So I ask myself: Is she really having her home repossessed simply for being a high risk customer and not for being in arrears or anthing? Hmm all sounds a bit fishy.

Nah, she's in arrears. Tell her to cut the crap and tell you the truth.

Please can anyone confirm this or blow my sisters deception out of the water? I need to confront her on this because my parents who live with her are having to go into rented accomodation and want me to be guarantor. I have a feeling they will move my sister in too (hoping I wont' notice) and I refuse to be a guarantor for someone who is incapable of managing their money and, worst of all lies, about it.

Your caution is wise. She will probably never learn. The over-borrowing habit is now deeply engrained.

Please help me work out if I'm being overly suspisious or whether this is a common practice by lenders!!

There other other reasons for repossession but they are exceptionally rare. Failure to maintain a property. Unauthorised tenancy. In 20 years of involvement with mortgage lending I can only remember 1 repossession case that wasn't mortgage arrears.

ESKIMO

She would have to be in a substantial ammount of arrears before repossession could occur as others have stated.

However, I do think you have a point on the 'high-risk' category as when Virgin took over from NRAM they may have programmed a system to 'dump' some of the 'higher-risk' mortgages which meant that they sent out a generic 'scary' letter. Unlikely, but not impossible.

Thrugelmir

ESKIMO wrote: »

However, I do think you have a point on the 'high-risk' category as when Virgin took over from NRAM they may have programmed a system to 'dump' some of the 'higher-risk' mortgages which meant that they sent out a generic 'scary' letter. Unlikely, but not impossible.

NRAM split the old NR asset book up and retained the high risk assets.

No grounds for sending scary letters. Not sure Richard would want PR of that nature even if they could.

somethingcorporate

Not a chance of it just being a high-risk customer. If she has kept her repayments up in line with her contract then she wouldn't have heard anything.

Sorry, but she is lying to you.

holly_hobby

As already stated, the only way a possession order would be instigated by the lender, and granted by the courts, are in relation to a breach of mortgage contract or arrears (in excess of 3 mths) .

A possession order hearding does not always result in a repossession order being granted by the Judge - it very much depends upon the circumstances of the hearing i.e if the mortgagor can demonstrate why they fell into arrears, how they may clear them and maintain the mortgage - the order may be suspended.

If however, its a breach of terms or there is evidence that the mortgage is unsustainable in the long term, or has been run irresponsibly - then the order may well be granted.

Your Mum & Dad (if not party to the mge) shoud qualify for emergency housing as in effect they have been made homeless by anothers actions - speak to your local authority or housing association for guidance.

Your Sister - well things are a tad more complicated for her ...

Hope this helps

Holly

EvilDoctorPorkChop

Hi all,
Thanks for your helpful advice. I thought it was all very suspect.
I spoke to NR today to check their policy on mortgage arrears and they confirmed that no such letter re high risk customers would ever be sent. Repossession only happens after many letters and a court hearing.
I am fuming that both my sister (and my mum and dad who backed up her story about speaking to the CAB) have lied to me in such a barefaced way. Quite possibly to make me feel more obliged to help them out of the hole they find themselves in. Feel vindicated in my decision not to act ad their guarantor. Hmm 2012 nay end up bring the year if the family rift.
Sorry to end the thread on a negative note