People in thier 60's being forced to sell homes.

abaxas

magpiecottage wrote: »

Oh no they can't. They can do so if there is a change to the structure and/or use of the property as that will affect its validity of it as security.

However, they are not automatically entitled to details of income.The only reason they might need to know is if the borrower applied to increase their loan or ran into financial difficulties.

If course they are if it is part of the contract, which usually (as in 99.999999%) it is. The process of mortgage underwriting is continual, not just at point of sale.

Why wouldn't a bank want a contract stacked in their favour?

silvercar

abaxas wrote: »

If course they are if it is part of the contract, which usually (as in 99.999999%) it is. The process of mortgage underwriting is continual, not just at point of sale.

Why wouldn't a bank want a contract stacked in their favour?

Disagree, there is no obligation on the part of the mortgagee to keep the lender informed of changes in job or salary.

Once granted the obligation of the mortgagee is to keep making the repayments.

silvercar

RUN_RABBIT_RUN wrote: »

you have to pay for all your own buildings and fixtures maintenance for one thing. the landlord pays for all that if you rent

plus there's all the initial expense of buying the house in the first place

But renters have the cost of moving and renewing rent agreements.

Find a tenant paying the same rent they did 25 years ago, you'd probably be hard pushed to find a tenant I. The same rental they were in 25 years ago.

Neverland

silvercar wrote: »

But renters have the cost of moving and renewing rent agreements.

Find a tenant paying the same rent they did 25 years ago, you'd probably be hard pushed to find a tenant I. The same rental they were in 25 years ago.

conversely its a lot easier for renters to move if they change where they work or they don't like the neighbours

Outside of the UK its a lot more common to rent

abaxas

silvercar wrote: »

Disagree, there is no obligation on the part of the mortgagee to keep the lender informed of changes in job or salary.

Once granted the obligation of the mortgagee is to keep making the repayments.

Incorrect,

All mortgages come with the 'change in circumstances' clause. You decide if you wish to keep to the contract or not.

Basically it's a coverall for the lender, meaning you are almost always in breach of contract. Exactly what they want you to be, so they can (if they wish) do whatever they like.

Welcome to the world of contracts, maybe if you read them before you sign, you may understand what you need to do.

zzzLazyDaisy

I have only read a couple of pages of this thread, so I apologise in advance if I am missing something.

But I am confused - I have owned houses for the past 25 years, on interest only and on repayment mortgages. Very soon after I bought my first house my husband left and I was a single parent, and later a mature student, with very little income. I was in my twenties when my husband left and it would have been easy to close my eyes to the need to repay the loan. But I have always understood that the mortgage was on a 25 yr term, or a 17 yr term, or whatever the conditions were, and have made provision for this.

For the mortgages that were interest only I had an endowment as a repayment vehicle - okay history showed that it wasn't the best plan, but the point is that I always knew that the mortgage was a loan which had to be paid back.

I cannot imagine blindly paying the interest alone, with no plan to repay the capital at the end of the term, and just assuming that the lender would allow me to continue paying interest for the rest of my days without demanding repayment of the capital - as per the contract.

When she took out the mortgage she must have been advised that the money would have to be repaid at the end of the mortgage term.

I am sorry, but while I feel sorry for someone who may lose their home due to being unable to settle their mortgage, ultimately it is down to mismanagement or 'head in the sand' - I really can't see how the lender is the bad guy in all this!

Apologies again if I have misunderstood something.

jamesd

Thrugelmir wrote: »

To amend the contract both parties have to be in agreement. If not the termination clauses in the contract become effective.

A party does not have a unilateral right to terminate the contract if they can't get the other party to agree to a change in terms.

Part of what you're missing here is that some lenders are trying to get people to switch to repayment even before their original mortgage term ends. If the borrower refuses the lender doesn't get to just terminate the mortgage and repossess.

If both parties do not come to agreement the borrower is not compelled to repay the mortgage, they are free to continue on the original terms at least until the end of the original mortgage term.

When that original term ends the borrower remains free to live in the property until such time as the lender successfully obtains a possession order.

Whether the lender could get a possession order against someone who is continuing to make payments and who has a credible repayment plan in place that now just happens to be later than the lender would like because the lender has changed their new lending practices is an interesting question. I expect it to be a tough argument to make successfully given a stable income and long record of payments being made properly under the original terms.

zzzLazyDaisy wrote: »

I have only read a couple of pages of this thread, so I apologise in advance if I am missing something.

There are several things that you may have missed:

1. We don't know that the mortgage term has ended, nor what it was originally.
2. The original repayment method seems to have been sale of the property on death, which hasn't happened yet.
3. It's long been standard practice to have a mortgage in this situation continue until death even after the end of the term.
4. Lenders have been changing their lending policies and trying to get some existing borrowers to change to repayment or, where they don't want to lend to borrowers of a certain age now, trying to get them to repay or move to a different lender.

It'd be inconvenient for a mortgage lender if their borrower hadn't died by the end of the mortgage term as originally anticipated but that's not really sufficient reason to let them take the house.

Emy1501

jamesd wrote: »

A party does not have a unilateral right to terminate the contract if they can't get the other party to agree to a change in terms.

Part of what you're missing here is that some lenders are trying to get people to switch to repayment even before their original mortgage term ends. If the borrower refuses the lender doesn't get to just terminate the mortgage and repossess.

If both parties do not come to agreement the borrower is not compelled to repay the mortgage, they are free to continue on the original terms at least until the end of the original mortgage term.

When that original term ends the borrower remains free to live in the property until such time as the lender successfully obtains a possession order.

Whether the lender could get a possession order against someone who is continuing to make payments and who has a credible repayment plan in place that now just happens to be later than the lender would like because the lender has changed their new lending practices is an interesting question. I expect it to be a tough argument to make successfully given a stable income and long record of payments being made properly under the original terms.

There are several things that you may have missed:

1. We don't know that the mortgage term has ended, nor what it was originally.
2. The original repayment method seems to have been sale of the property on death, which hasn't happened yet.
3. It's long been standard practice to have a mortgage in this situation continue until death even after the end of the term.
4. Lenders have been changing their lending policies and trying to get some existing borrowers to change to repayment or, where they don't want to lend to borrowers of a certain age now, trying to get them to repay or move to a different lender.

It'd be inconvenient for a mortgage lender if their borrower hadn't died by the end of the mortgage term as originally anticipated but that's not really sufficient reason to let them take the house.

If the term of the mortgage has ended the lender has the right to their money back and I suspect that a court would have little sympathy unless the borrower can show that it was implied by the lender that she could roll over the debt and move onto a lifetime mortgage at the end of the term.

Whilst lenders are trying to get people on IO mortgages to change to repayment ones. there is little if any evidence that the lenders are threatening to terminate the mortgage if this not done.

It seems highly likely therefore that the mortgage was taken out on the basis that a repayment tool was in place to pay off the mortgage at term and no evidence has been made to actually do this.

Going4TheDream

If the banks wanted to be in the rental market then I am sure they would.

She enjoys her income and has no desire to pay off the capital........

Why should someone who has not paid their loan principal off at the end of the term be allowed to continue to pay their interest only of £501- which I imagine in this case is far less than the market rental for a £500k property?

chewmylegoff

Going4TheDream wrote: »

If the banks wanted to be in the rental market then I am sure they would.

She enjoys her income and has no desire to pay off the capital........

Why should someone who has not paid their loan principal off at the end of the term be allowed to continue to pay their interest only of £501- which I imagine in this case is far less than the market rental for a £500k property?

well, she does own 70% of the property. the market rental of the 30% of the property that the "bank owns" is probably not that far off the interest rate she is paying, given that it works out to be 4.2% or something, and gross rental yield is typically around the 5% mark.

the bank could just jack up the rate a bit - but it clearly wants its principal back instead.