Considering voluntary repossession

jdogg1976

Hi guys, sorry if this is the wrong forum.

I have a problem. I am a homeowner, well I've got a mortgage. I am desperate to get out of my house but feel trapped. My wife and i have been subject to vandalism and local youths terrorising us. We are at our witzend and feel we can't go on any more in that house or we will both end up being sectioned.

Over the last couple of years we have had nasty notes put through the door, one of our doors kicked in, and had windows smashed twice. We are both scared in our own home. Other than that we are unhappy anyway in the house, we've had a kitchen ceiling fall down, the boiler badly needs replacing and it needs so much work done on it.

But there lies the problem. We can't sell the house to escape these mindless idiots because the house needs work done on it. We need to redecorate the kitchen after the ceiling incident, we need to put up a new back fence and gate to stop these idiots getting in, we need to properly mend the door and window, the boiler needs replacing.

Until we do these things we can't realistically sell the house. We can't afford to make these repairs. Can't get a loan due to bad credit. Basically we are trapped. We tried last year to sell it to one of these dodgy companies who buy your house off you at a cut down price but they only offered us £25000 when we still have £47000 left on the mortgage.

I'm sure despite the work needing done, it's worth at least what's left to pay on the mortgage, potentially more. So that offer was an insult to us.

So what I'm thinking of doing is going for a voluntary repossession. Just hand the keys back to my mortgage company and leaving. I would then hope to find somewhere to rent/let. My parents have offered to take us in as well.

Have any of you ever done this? What has been your experience?

I know I will still be liable for the mortgage until they sell it.

Any help would be appreciated.

Annisele

jdogg1976 wrote: »

I'm sure despite the work needing done, it's worth at least what's left to pay on the mortgage, potentially more.

In that case, why don't you just sell it on the open market? I know you say it needs lots of work doing to it, but some people specifically seek out houses like that - they want to buy a 'doer upper'.

I know I will still be liable for the mortgage until they sell it.

Unfortunately it's worse than that. Repossessed houses often sell for less than they would if the owner was still occupying them, and if the house sells for less than the mortgage amount you'll be liable for that shortfall.

jdogg1976

I will have to pay a survey fee which I can't afford right now.

Yeah I know I'd be liable for the shortfall.

Thank you.

Annisele

Usually the buyer pays for the actual survey, but the seller does have to pay for an energy performance certificate (which you can sometimes get for £60 or so).

If you can't afford that, it could be worth you asking your lender about an assisted voluntary sale. With an AVS, you stay in your house until it is sold, and the lender covers some of the costs of the sale - but both AVS and repossession will trash your credit rating. If you're not worried about protecting your credit rating, AVS is *probably* a better option than repossession - but the lender doesn't have to offer it.

Shelter should be able to give you some good advice - but be patient with them, they're very busy.

GM11

try the auction route also. It's a real shame you are being hounded out, have you been to the police or council and looked into the ASBO route? i would exhaust all other options before i went down the repo path. it may seem a temptation now because it will let you see a light at the end of the tunnel but later you will regret.
with a little thought and creativity a house can be tarted up with little money, i feel for you, in this day and age this kind of thing shouldn't happen!

wwtrend

Not all companies that advertise we buy houses make offers below market value. I know this because I have one and work alongside a number of others where we specialise in properties where people have difficulties selling. Up and down the country there are property meetings. I don't know what area you live in but if you check out the property investors network you will find these meetings. Get in quick because there are no meetings in August. Contact the organiser and you will get the first meeting free. You could also ask your local organiser to put you in touch with someone who would offer you market price. Market price would be on your house in it's current condition. Kitchen roofs falling in are normal repairs for property investors. You also may be interested in making part of the deal for the property investor to find you some options for somewhere else to live within your budget and even to look for somewhere else where you can get back on the property ladder and minimize the length of time you have to pay dead rent. Some companies are good and some are not so good so it's the same as everything else on the market.

There's a big meeting in Berkshire tonight then next week in Leeds, Manchester, Newcastle London and other places. Would love to help you myself but can't send my details. With something as big as a house don't give up because you had a bad experience with one company. There are people who specialise in getting property below market value and very often they work involves repossessions. So the previous advise about handing back the keys is correct. Please try finding a decent company to buy your house offering market value and no fees to seller as an option before you consider AVS because your credit rating is something really worth protecting. It's just an option worth exploring properly can't hurt might help! I know you are probably feeling low at the moment with everything going on but it will pay to make some effort now instead of looking for a quick and easy solution of giving up. The beauty of finding the right people to take on your property is we don't like to see someone fall off the ladder but taking a step back is sometimes necessary and no-one goes through life without some hiccups. Getting info on all your options is important before making your final decision.

I would have liked to meet some people I know now when I first had a problem and had to make decisions by myself when I feeling the lowest. You have each other, supportive parents and people who care enough to give others then will never know or meet sound advice. Keep strong your options are far more than you believe at present and you need them all in a row with the pros and cons of each before making a final decision.

I_have_spoken

My wife and i have been subject to vandalism and local youths terrorising us

Can you get the bizzies off their backsides by escalating this to hate crime (race, disability, faith etc.)?

wwtrend

Sorry look at the website, property investors network for details of property meetings. There are others as well which might be property clubs but I know the the property investors network will let you attend the first one free otherwise they are £20 and the other meetings around £15 to £20 a meeting.

Rain_Shadow

A friend of mine split from his wife due to her alcoholism and violence. He left the home and she remained in it. They agreed to sell and put it on the market at £180k (os mortgage was about £50k). However, she then made viewings near impossible and generally did everything she could to block a sale. Eventually he surrendered the property to the lender. It sold for £110k.

So, don't imagine the lender will do you any favours as long as they get their investment back.

jdogg1976

Thanks for all the great feedback guys, I've not had a chance to go through it all yet as I'm in work but I will do ASAP.

pinkteapot

If it's repossessed it will be sold by the bank for a rock bottom price. If what they get for it is less than the mortgage you owe, they'll chase you for the difference, which you will be legally liable for. You'll have to enter some sort of repayment agreement with them end up going down the bankruptcy route.

I'm not saying this to be mean, just to make sure you're aware of what the repercussions will be.

Have you got any idea of what it would sell for on the open market? People will buy houses that need work, so long as they're priced accordingly. If it's worth £50k on the market, it'll see for a lot less if it gets repossessed. If at all possible, sell normally at a knock-down price for a quick sale.