stopped paying the mortgage - now what?

mrsrwallace

hi folks, thanks for the replies.
yeah steveymp i re-read the estate agent agreement and they COULD discover we had made a sale and bill us for any lost costs they should have got. pepper33, my OH had same concern about the chance of the possible landlady offering us a cheap rent to secure a sale then hit us with a higher rent after completion.

it maybe sounded too good to be true you know when i sit and mull it over. also, if say she decided to make improvements to the house and sit for a while before deciding to put it on the market then we'd be out on our ear. my biggest worry, i am shamed to say, is what will we say to folk?? if we sell now then we have 2 answers for depending on who we speak to (i.e our closest friends and family will be told the truth about how we cannot afford to keep it on and would likely be repossessed soon enough) and then for other folk like acquaintances or work colleagues we have an answer saying we're looking to move as the area has gone downhill etc. BUT if we accepted this offer then say a year or 2 down the line she decides to sell, then what do we say to folk???

if we sold now to her she said she'd keep it hush hush and wouldn't broadcast it that we are her tenant to protect our privacy so folk wouldn't know the extent of our financial mess but if she sold down the line how could we pass that one off?? We couldn't say we were selling up as any viewers/buyers would be dealing with her not us and it would be her name on the papers so the news could get out then.

i'm wondering should we just wait to see another while if we get any more offers then sell to the highest bidder and make a new start in a different house/area? brand new beginning? turning the negative into a positive?

irishjohn

Mrs Wallace

Two things to consider.

Potentially selling and renting back - the offer to keep it hush hush etc is very tempting. It could be someone making a generous gesture, did you tell her your situation or did she learn it from the estate agent?

Before accepting or refusing you could discuss the rental further with her, and perhaps seek two things . One - a guaranteed rent for a period of time to suit you and two - a signed agreement that you will be given first refusal to buy back if she decides to sell. Even these will not provide a cast iron guarantee for you though.

The second thing to consider - what to tell people. Please be assured that those who treat your situation as gossip are not good decent people. Hold your head up and be honest - tell people that the impact of the current financial mess on your household has forced you to take some very difficult decisions to keep yourself and your family going and you have taken those decisions now rather than when things become messy. You do not need to tell anyone what you ow, or even if you owe anything - simply that you have taken stock and taken some decisions for the good of your family.

You have been open and honest with us and you deserve respect and credit for this. Those who matter will give you that out in the real world.

Keep your chin up.

mrsrwallace

thanks so much for that post irishjohn
that really makes sense and you are right, why should i hide my head in shame? I am selling because we can't afford to remain here and taking responsibility for our future so yes i agree with you that those who matter to us will know the truth and who cares about anybody else? Normally i have an approach to life that the opinions of those who matter to me matter and anybody else can take a running jump but why when it involves money an debt do i care!?

In answer to your question the viewer had asked why we were selling and i thought i'd just be honest and told her it was due to the recession and losing main income and having to consider our affordability now. She then asked where we would move to and we had said we'd rent somewhere and that is when she asked about us becoming tenants for her.

I did get the feeling she was genuine and it probably would be an easy choice for her and us in that we could start paying rent as soon as house sale was completed so it would save her time etc getting new tenants. So yeah its something to consider if no better bids come our way, the house will be repossessed if we don't sell, there is no question of that so yeah, more thinking to do!

Old_Git

mrsrwallace wrote: »

thanks so much for that post irishjohn
that really makes sense and you are right, why should i hide my head in shame? I am selling because we can't afford to remain here and taking responsibility for our future so yes i agree with you that those who matter to us will know the truth and who cares about anybody else? Normally i have an approach to life that the opinions of those who matter to me matter and anybody else can take a running jump but why when it involves money an debt do i care!?

In answer to your question the viewer had asked why we were selling and i thought i'd just be honest and told her it was due to the recession and losing main income and having to consider our affordability now. She then asked where we would move to and we had said we'd rent somewhere and that is when she asked about us becoming tenants for her.

I did get the feeling she was genuine and it probably would be an easy choice for her and us in that we could start paying rent as soon as house sale was completed so it would save her time etc getting new tenants. So yeah its something to consider if no better bids come our way, the house will be repossessed if we don't sell, there is no question of that so yeah, more thinking to do!

she may be thinking you would be good tenants .

Old_Git

mrsrwallace wrote: »

oh and another thing....potential buyer/landlady has said that i could cut out the middle man (i.e estate agent) and save the fees on that by removing my property from the market and doing a private deal. I have no experience of that so a) is it legal to do that? b) how quick nowadays does a sale complete bearing in mind that this is a cash buyer with no mortgage approval holding her up? c) i also have an IVA that is half way completed, will this be taken into account when selling? Quite a few things to consider so any advice is greatly appreciated Oh and sorry! but after house is sold and shortfall is there to pay would i need to amend IVA or can I arrange a repayment plan with the mortgage lender?

I take from this that if you sell the mortgage still wont be clear .
Can you sell and still owe on the mortgage.

irishjohn

Another thought

Enquire how many houses she owns and rents out and how long she has been doing it - all in a gentle way to help you gain a better picture of who you are dealing with. If she has a reasonably sized rental portfolio then you could be onto a good solution for your dilemma. If however its her first venture - you would need to be more wary - just in case it doesn't work out as she hopes and she decides to re-sell quickly.

mrsrwallace

Old Git, in answer to your question, no the mortgage will not be cleared if or when we sell. There will be quite a shortfall debt left and so we will either have to arrange with the lender a repayment plan to pay that back or consider BR although I would prefer not to take the BR route unless it was the absolute last resort.

Yes you can sell the property with a shortfall but you need to speak to the lender to agree to that, we have spoken to ours and they have agreed we can have some time to try and sell the property before they initiate the repossession process. This way they have a better chance of getting a better price so more money towards paying off the mortgage whereas if they repossessed they might have to take a massive drop in price or face even lower offers at auction.

mrsrwallace

little update on the situation.....
we have accepted an offer on the house and have been to view some rentals to see what is on offer for what we can afford. simples! :jexcept it's not...!??

got a letter from the buyer's solicitor confirming offer and so I had to contact the mortgage company to get confirmation for the solicitor that we will owe a shortfall and also to get confirmation that the mortgage company will release the mortgage charge from the property to enable the sale to proceed. !!!!!!! This sounds like this will take FOREVER to get this sorted. So now we have to wait on mortgage company to get a valuation done and for them to confirm the offer we got is the best we'll get etc etc and now i'm left worried AGAIN that something is going to go wrong with this!

I thought (naively) that you get a buyer, you sell, you pay back the shortfall but NOOOOOOooooooO! It seems to be correspondence for this and correspondence for that and it's all beginning to really get to me now, i sometimes wish I'd just thought !!!! it and let them have the keys - that seems such an easier option from where I am sitting now. All I seem to do is be on the phone on hold waiting to get advice or whatever every day. I come in from work shattered and spend my entire free time up to my eyes in paperwork and emails and seemingly going one step forward and two back again.

Also contacted my IVA company to see about getting the shortfall debt included in that and there was MORE paperwork sent out to complete and a variation meeting arranged - if creditors refuse then i have no alternative but BR. I don't want that if at all possible due to my work and possible future work.

So I am in a dilemma as to what to do next, it is inevitable we will have the house repossessed if this sale falls through or the buyer gets fed up waiting for all this process to get finished. So do we just go ahead and find an affordable rental house anyway and give them a date for when we can move in as realistically we cannot stay here forever regardless of the outcome. Ah - !!!!!!! fed up with this now.:(

saverbuyer

Did you apply for support for mortgage interest (SMI)?

Golden_Anemone

saverbuyer wrote: »

Did you apply for support for mortgage interest (SMI)?

Posted on first page

mrsrwallace wrote: »

...hi
believe me there is little to no help out there for working families with children! I have looked! In fairness we do get some Child Tax Credit and Working Tax Credit but it's not enough to compensate for our once high income and so to remain living here is living beyond our means. We get Rate relief but no mortgage assistance. That is only for people in receipt of benefits and even then there is a serious delay before anyone gets actual financial assistance...