Company to negotiate with lender

flads

Hi
Basically we have a property in major negative equity and a company say if we sell they can negotiate with the mortgage supplier to reduce the shortfall that we have to pay (by quite a significant amount) It would be a way out for us cutting our losses but they charge £3000.
Circumstances are that we have a £185000 interest only mortgage costing us approx £820 per month but the property is probably only worth £120000 now. They say they are confident that if we could get an offer of £120000 they could get the lender to reduce the amount we owe from £65000 to maybe £10000??
Is this possible??

silvercar

You can't sell without the lenders consent. So you are going to have to get the lender to agree to transfer the negativity equity to an unsecured loan. With the figures you quote I can't see that happening.

More likely you could hand the keys back and let the property be voluntarily repossessed. The lender will sell it and then try to reach an agreement with you about repaying the negative equity. It is at this point that the lender may agree to a lump sum payment rather than a longer term loan.

The idea of paying a company to handle this for at this stage seems madness.

ACG

Do they only charge £3k if you get the reduction or do they charge it upfront?

They can respond to that with whatever they like but for me that would be a deal breaker.

Annisele

If I was the lender in that scenario, I'd be pretty annoyed that you had a spare £3k that you paid to someone else (to try to avoid paying me) when you could have put it towards reducing your debt to me.

Why not try negotiating with the lender yourself?

flads

Thanks for replies, I am nervous of trying this myself. But am making a few more enquiries. You pay £300 upfront and agree the remainder of the fee in stages or £500 and the rest on completion. Although it will ultimately be payable no matter what reduction (if any) is achieved so there is a risk.
Really not sure which way to go

StuC75

So lets get this straight, you would be happy to pay out £3k with no guarantee of a result..

They have no motivation to see any kind of conclusion on this, and you would never be able to sell without the lenders permission on this anyway - so it is the lender that has all the power on this.

this company has no other power or ability beyond what you could probably do yourself.

Alarm bells should be ringing on your part..

flads wrote: »

Thanks for replies, I am nervous of trying this myself. But am making a few more enquiries. You pay £300 upfront and agree the remainder of the fee in stages or £500 and the rest on completion. Although it will ultimately be payable no matter what reduction (if any) is achieved so there is a risk.
Really not sure which way to go

ACG

Do not do it.

With all respect, they are praying on you "greed" so to speak. Greed in the sense that you could be £5-10-20k better off.

Jenniefour

This sounds like a scam - albeit probably legal. Like the companies who charge for getting missold payment protection back. Run a mile. Much better to see what agreement you can reach yourself - for nothing.