Stopped paying mortgage and moved out

chriswedge

Hi

My brother in law was recently involved in a serious accident and was unable to live on his own anymore. We temporarily moved into his flat and undertook the mortgage payments (paying into his account, whilst the payments came out). We have now moved out and my brother in laws POA has now stopped payments for the mortgage. This was a few months ago and I notice that nothing has yet happened with regards to the property.

There have been letters sent by utility companies however including one from a debt collecter. This spooked me and I called up and arranged to take over the account again whilst no-one was living there.

Basically the POA just wants rid of the flat now, and I want to remove all liability for bills. What is the best way to go about this? Can we just leave everything and forget about it or is it likely to affect the POA in some way? The utility company did say I could stop the elec/gas supply so this is an option.

Apologies if this is posted in the wrong area but we really do not know what to do.

Thanks

maninthestreet

POA? Why can't your brother in law sell the flat?

chriswedge

The Power Of Attorney (POA) is my mother in law. Basically the flat is a part rent part buy, and possibly in negative equity. They just want shot of it, and mortgage/rent payments have now been stopped for 5 months. They could do without the added stress of it all considering they now need to care for their son full-time.

Thanks

maninthestreet

Your MIL has a duty to act in the best interests of the person whom they are acting as atorney. How does failing to ensure the mortgage on your BIL's property is paid meet this duty? Does your BIL have any savings ?

chriswedge

I believe he has no savings. He was having money issues before his accident, and had cancelled his Life Assurance, Critical Illness etc previously. There is no money to continue the mortgage payments now myself and my partner have moved out, so I don't see how they could continue payments and sell, especially if it's in negative equity?

Thanks

bigadaj

In most circumstances this would be the worst option but it may practically not be that bad. Someone needs to contact the lender and arrange to hand the keys back, th slender would then sell potentially at auction and there would be a debt that the mortgage holder would be held liable for.

If your bil has no money, littl e income and prospects for economic improvement are low then the fact hat his credit file will be damaged will probably have little impact. Mortgage debt liabilities typically last for twelve years rather than six for unsecured debt, but someone needs to do something to resolve it. The someone would seem to be you mother in law.

Thrugelmir

Given that your MIL has POA, has she made contact with the creditors to explain the situation or merely walked away allowing debts to accumulate.

Annisele

chriswedge wrote: »

Can we just leave everything and forget about it or is it likely to affect the POA in some way?

Just leaving everything is very unlikely to be the best option.

Lenders have a duty to treat borrowers in financial difficulty "positively and sympathetically". But they can't do that if nobody will talk to them!

At the moment, it's likely the lender thinks your BiL has done a bunk, and is just trying to ignore his debts. If the lender knew the full situation, it's likely it would be much more sympathetic - and might even be helpful.

It sounds as though there's no chance of the BiL being able to keep the flat, so having the lender take possession and sell may be the best of a bundle of bad options.