RBS - Transfer of Title no longer allowed!

chilli_burn

Hi all

really hope someone can give me a legal something or other to press RBS on this.

So, I have had pain from RBS for many years, but they have me by the balls in that I am around 50k in negative equity so I can not leave them.

I managed to get a new deal out of them that kicked in 1st Jan 2014, 5 year fixed on a great interest rate. I will not go into details, but RBS were not great at time but came through in the end.

since then, my wife and I have agreed to divorce. I am taking on the house due to the neg-equity, and hence I need to remove her from the mortgage and the deeds.

I rang RBS, explained the situation, they reviewed my account and agreed to send me the "transfer of request" forms. 4 days later, I get a letter stating:


"Thankyou for your recent transfer of title request. Unfortunately due to a recent change in criteria, we are unable to issuethe paperwork. Royalbank of Scotland no longer offers mortgage borrowing on northern irelandproperties, includes making variances to current mortgages"

So, I rang the Ulsterbank help desk, which subsequently put me through to RBS call centre! I told them about it and the guy said

"yes, that's true, u need to go into an actual branch of ulster bank, and discuss taking out a new mortgage on your property"

I said to him, that:

1. I have 50k in neg. equity so RBS are my only option as the original valuation stands
2. I have just started into a new 5 year deal, so I would no doubt be charged 5 year early repayment at 5%
3. RBS never informed me of any of this when they decided to blanket stop any further changes to my mortgage

I mean, what if my wife or me had died? the same process has to take place, and they would screw you at that point too?

surely what they have decided is illegal in some way? I can not see this as being fair, and it is yet another example of the banks trying to screw us?

help!!! should I go to the ombudsman?

the guy on the helpline took my number and said he would call me back, but I have NEVER actually got called back by RBS before when promised

the stress of the divorce I enough to send me over the edge, and this is just the nail in the coffin for me....

cheers

kingstreet

TBH with that level of negative equity, most lenders would turn down a TofE request as they would view removing a borrower as extremely risky, if they repossessed they'd only have one person to pursue for the shortfall.

As a policy move, that's a pretty crappy move on their part, though.

chilli_burn

hi kingstreet... I wold agree under normal circumstances, but it is my wages that pay for the mortgage, my wife is a low earner.


The amount of mortgage offered to me on my own income is around 60% over the top of out standing balance on this mortgage so financially I suspect they would be OK with it when evaluated...

this is quite the predicament, it might mean that we have to both remain on the mortgage which means I will have a joint mortgage and be tied to her reliability for the next god knows how long...

hoping this dude from the help desk does call back and with some sort of news that is manageable

silvercar

this is quite the predicament, it might mean that we have to both remain on the mortgage which means I will have a joint mortgage and be tied to her reliability for the next god knows how long...

Although this is undesirable, it leaves her with a bigger problem than you. Whilst she is named on this mortgage, she will find it much harder to get a mortgage elsewhere. This may not be a problem for her now, but who knows what will happen in the future.

chilli_burn

silvercar, you are right... and that I another reason we were going down this path... I wanted her to have the freedom to move on once the divorce is through

on the flip side, I did not want to rely on her to be responsible, and not turn into a crazy-woman years down the line (not my wording LOL but u get the idea)

we just want clean beak and this will stop that happening. I can imagine the banks would not like the situation either for me getting a new mortgage... not sure it would matter too much but I can just imagine them not liking me having another liable party hanging on

I am thinking I might go to the ombudsman over this

chilli_burn

it gets worse the more I think about this..

outstanding mortgage = 160000
house value is say 110000

if RBS make me get a new mortgage, it will be with ulster bank. they will only give me a loan against a new valuation, which is likely to come in around 110000. so how the hell do I get a mortgage with no cash in the bank? going through a divorce after all!

I guess I would have to et a loan out from someone to cover the equity shortfall on the mortgage change over, but still leaves me with nothing for getting any sort of a decent LTV on the new mortgage

I wonder would ulster bank honour the RBS valuation on the current mortgage?

this is not even taking into account the early repayment charge that RBS will try and swindle...

wow, this situation is impossible... there must be something legal here.. RBS can not just blanket screw the world over again

Goldiegirl

Whenever I see the phrase 'surely it can't be legal' (or similar) on MSE, it usually means 'the bank won't do what I want, and I'm angry and frustrated'

To be honest, I think the no longer lending in Northern Ireland thing is a side issue in your situation.

The real issue is the negative equity. It would be very unlikely for any lender to consider a transfer of title where there is negative equity. They feel the situation is insecure enough as it is, as, in the event of repossession, they wouldn't get all their money back, and the situation would be even more insecure if one borrower was removed.

Although it doesn't help you, they decide who they want to lend to, and on what terms. You can't force them to do something that is outside their lending policy.

Early repayment fees aren't a swindle, they are part of the terms and conditions of the mortgage, which presumably you agreed to when you completed the mortgage.

I don't envy your situation- I think you might have to sit tight until house prices recover, and then you'll be able to resolve the situation

chilli_burn

hi goldiegirl

thanks for the candid response. although I do agree with you on most terms, what i can not see as being fair, is that the RBS let me sign up to a new 5 year deal, without ever mentioning that they are about to remove any further changes to that policy no matter what the circumstances are

having only me on the mortgage would be far more financially stable for RBS than to have my ex-wife on it that's for sure, and they would see that just be reviewing credit records.

their decision to just remove possibility any mortgage amendments full stop can not be right. what if one of us had died? the same process has to take place!

Thrugelmir

chilli_burn wrote: »

I am thinking I might go to the ombudsman over this

Your mortgage is a contractual liability. That is joint and several. To amend the terms in any way all parties to the contract have to agree to any change. Removing your partner is detrimental to the security that RBS holds. So there is absolutely no basis on which they will agree given your circumstances. Approaching the ombudsman will get you no where.

As has been said before your wife will be the one to suffer. As she will need to remain on the mortgage.

As part of the divorce process you'll need to get her to agree to making no further financial claim on the property in the future. Correspondingly you'll need to give an undertaking to remortgage when circumstances permit. No one can predict the future so a time limit should be placed in which this takes place. (Obviously this will be in years). If the property is not remortgaged within the time limit. Then the property is sold.

The arrangement needs to be fair to both parties to suceed. With a suitable undertaking then it is in your interests to repay the existing mortgage as soon as possible.

Goldiegirl

Maybe the policy hadn't been changed when you signed up. Or, as you were making a long term commitment to them, they didn't even think to mention that they weren't doing new lending in NI, as you were 'locking in' for period of time, they didn't think you'd be wanting a new mortgage.

Re dying....

This is how it works in England & Wales - I don't know if it's the same in NI

It depends if the deeds were drawn up as joint tenants, or tenants in common.

If it's a joint tenancy, the property automatically reverts to the surviving borrower. So the deeds and the mortgage would be changed without the need for a Transfer of Equity.

If it was tenants in common, the deceased persons share of the property can be left to another person, and often a transfer of equity application is needed to resolve the situation. In cases where the ToE is not possible, due to negative equity for example, the mortgage would be held in the names of (for example)

Mr John Smith deceased & Mrs Anne Smith,
until everything was sorted out! Not ideal, but when I worked for a lender, I did see a few cases which took years to resolve!

chilli_burn

right, thanks guys, that does clear it up. did not think about the financial order containing lines in there about the house having time limits, and forcing a sale through on a certain date etc.

what a time for a divorce! bit of a pain that i have to rely on my ex-wife paying her share. however, in reality, I was going to be paying the entire mortgage anyway, but I was worried with her still on the deeds, she could at a later date, come in and demand her half, no matter what the agreement stated!

this is what I need to do then:

"get her to agree to making no further financial claim on the property in the future. Correspondingly you'll need to give an undertaking to re-mortgage when circumstances "

there is already a section about no further claims on pensions and what not, so this will just have to be another section around the property, just mean sit will be a little more complex

thanks for all the advice people. although no good news, I think I understand a bit better now