repossession and 30K short. Advice needed

sjp2057

My daughter is in a right pickle. Briefly

1 split from boyfriend 4 yr ago after buying a house together.
2 daughter offers bank to hand over her half to him. they refuse
3 he is still living there and for 3 and half years defaulted on the mortgage payments.
4 Bank is now considering repossession
5 after the house is sold they will be about 30K in the red.
6 Ex boyfriend ducks and dives CSA payments by working agency all the time and the missed the mortgage payments so the Bank wants to chase my daughter for the 30k.
7 bank won't accept her taking on a 15000 unsecured loan to pay her half even though she supports 2 kids, on social with no help from him. They refused.

They only way out is as she sees it is to go bankrypt as soon as the house is sold.

My daughter is struggling enough without this hanging over her but is there other options available.??.

can you help.

thanx

jamesd

Bankruptcy is an entirely legitimate solution. Beats you paying to prevent it. The bank is entirely within its rights to refuse to accept £15,000, since she'd owe them the full £30,000, as would the ex. She's jointly responsible for paying the mortgage so it's fine for the mortgage lender to chase her.

She could pay the mortgage arrears if she wants to avoid the repossession and probably below market value sale price the lender would get. The problem then is forcing sale of the property and avoiding the ex wrecking the place before sale. A solicitor would be needed now if she was to consider this route. It's the one that probably has lower long term consequences for her than bankruptcy but higher up front costs for the legal bills. She could discuss this option with the mortgage lender to see whether they will accept this in conjunction with some reduction of the amount overdue. While the lender will protect their interests they may recognise that the problem is the ex, not her. Not strictly true since she's also responsible for paying the whole monthly mortgage payment.

Rather than forcing sale the boyfriend might agree to moving out voluntarily so it can be sold. You or a loan can be used to pay the mortgage while the property is prettied up for sale. That might well increase the sale price achieved and for that reason the mortgage lender may accept this plan provided there is some reduction in arrears and a commitment to make mortgage payments during the process. This would be cheaper and better overall than a forced sale. The mortgage lender would have to agree to any offer that would be accepted for the property and nothing can force them to accept an offer if they don't want to, unless it's high enough to completely clear the mortgage.

If the rental market would pay enough to cover the mortgage, the ex moving out and the property being let may help, if the lender is willing to agree to this as a way of allowing the property sale price and loss from possible repossession to drop over time.

She has a right to live there and could exercise that right, with legal assistance if necessary. This could cut her own living expenses and improve her ability to afford the mortgage payments.

It might be possible to get an order allowing her to live there without the ex being permitted to live there. Legal advice would be required about the viability of this in her situation. Or the ex might agree to moving out and her moving in to avoid the likely large debt from the repossession sale. A lodger might be one way to make this affordable for her.

If she was living there the bank might accept a guarantor for the mortgage payment as part of the deal, a sweetener for them. provided that they trust the guarantor and that the guarantor understands whatever obligation they are accepting. An offer of say mortgage payment guarantee for three years might be helpful. This could be used if they have affordability doubts for her alone.

A successful repossession would normally require an absence of a plan that would solve the problem in a reasonable amount of time if there was no repossession. Written plans of various types that appear viable but have been repeatedly rejected by the lender will harm their chance of getting a repossession order.

longtermplanner

It sounds as though bankruptcy is the sensible option. It is shame she didn't opt for it 3 years ago!

sjp2057

James D

Thanks for the advice . Your advice seems to be she same as we have considered for her and in fairness it is what will happen.
The guy she was with is an ******** but its my daughter who is getting it in the neck because she is playing it straight where he never does.

Its a shame the bank wouldnt change there veiw on him 3 years ago when they alowed him to hoodwink them into aggreeing him to stay and pay the mortguage. he did so for 6 months then stopped.

The only problem seems to be that they will chase her for all of it if they cannot catch up and pin down the ex. Effectivley he will get away from the debt unless you have any advice on how to get him to pay his half. ??

regards
sjp2057

jamesd wrote: »

Bankruptcy is an entirely legitimate solution. Beats you paying to prevent it. The bank is entirely within its rights to refuse to accept £15,000, since she'd owe them the full £30,000, as would the ex. She's jointly responsible for paying the mortgage so it's fine for the mortgage lender to chase her.

She could pay the mortgage arrears if she wants to avoid the repossession and probably below market value sale price the lender would get. The problem then is forcing sale of the property and avoiding the ex wrecking the place before sale. A solicitor would be needed now if she was to consider this route. It's the one that probably has lower long term consequences for her than bankruptcy but higher up front costs for the legal bills. She could discuss this option with the mortgage lender to see whether they will accept this in conjunction with some reduction of the amount overdue. While the lender will protect their interests they may recognise that the problem is the ex, not her. Not strictly true since she's also responsible for paying the whole monthly mortgage payment.

Rather than forcing sale the boyfriend might agree to moving out voluntarily so it can be sold. You or a loan can be used to pay the mortgage while the property is prettied up for sale. That might well increase the sale price achieved and for that reason the mortgage lender may accept this plan provided there is some reduction in arrears and a commitment to make mortgage payments during the process. This would be cheaper and better overall than a forced sale. The mortgage lender would have to agree to any offer that would be accepted for the property and nothing can force them to accept an offer if they don't want to, unless it's high enough to completely clear the mortgage.

If the rental market would pay enough to cover the mortgage, the ex moving out and the property being let may help, if the lender is willing to agree to this as a way of allowing the property sale price and loss from possible repossession to drop over time.

She has a right to live there and could exercise that right, with legal assistance if necessary. This could cut her own living expenses and improve her ability to afford the mortgage payments.

It might be possible to get an order allowing her to live there without the ex being permitted to live there. Legal advice would be required about the viability of this in her situation. Or the ex might agree to moving out and her moving in to avoid the likely large debt from the repossession sale. A lodger might be one way to make this affordable for her.

If she was living there the bank might accept a guarantor for the mortgage payment as part of the deal, a sweetener for them. provided that they trust the guarantor and that the guarantor understands whatever obligation they are accepting. An offer of say mortgage payment guarantee for three years might be helpful. This could be used if they have affordability doubts for her alone.

A successful repossession would normally require an absence of a plan that would solve the problem in a reasonable amount of time if there was no repossession. Written plans of various types that appear viable but have been repeatedly rejected by the lender will harm their chance of getting a repossession order.

jamesd

They will chase both of them for all of it until they get it or both go bankrupt.

It is worthwhile discussing the bankruptcy plan with the lender in case that causes them to realise that they do face a loss of any shortfall if they don't come to some alternative agreement.

longtermplanner

sjp2057 wrote: »

The only problem seems to be that they will chase her for all of it if they cannot catch up and pin down the ex. Effectivley he will get away from the debt unless you have any advice on how to get him to pay his half. ??

Sorry but you need to stop thinking about "his half" and "her half". these concepts are useless unless both parties have lots of money in the bank, and it sounds as though neither has.

Even if her ex paid "his 15k", your daughter should not saddle herself with a loan for "her 15k". As a single parent who is already struggling, this would make no sense at all. and she should be looking at bankruptcy to get rid of it.

And as there seems no chance he will pay, bankruptcy will give her the new start that she needs, putting this old relationship completely in the past.

janineh1982

Sorry to hear about your daughters troubles.

I had a similar issue about 8 years ago when i and my ex husband split up. He remained in the house saying he would take the mortgage on....After months of messing around he decided he didn't want to take over the mortgage and also stopped paying his 'half' of the monthly balance (whilst he was supposedly taking the mortgage on we paid 50/50 for the mortgage)

At the time i didn't earn enough money to fully pay the mortgage (even though i had moved back to my parents with low bills)...Essentially he turned into a very large [STRIKE]****[/STRIKE], not very nice person, refused to pay any bills/mortgage, refused to move out, refused to agree to sell, refused to agree to rent.

Throughout this period i was in constant contact with the mortgage company who understood the issues, however as other MSE'ers have noted....The bank/Mortgage lender don't define the loan or mortgage as his and hers, they simply see it as an amount owing for which both parties are equally liable. There will be no opportunity for your daugther to pay her 'half' and leave her ex responsbile for the remainder. If your daughter did pay 'half' the bank would continue to chase her and her ex for the remaining monies owed.

Essentially my situation went on for months and months to little avail, solicitors were involved but essentially we couldn't do anything quick enough before the bank (after about 6-8 months) started looking at repossession. After agonizing over my options (including IVA, but this is a legal agreement and again needed ex husbands buy in (pardon the pun), it appeared the only one was to declare bankruptcy.

This isn't a decision to take lightly though. If your daughter opts for this route, she will be liable potentially for up to 3 years to re pay creditors (based on affordability) ....This will be on her credit record for 6 years, stopping her from getting simple things like a phone on contract, to passing credit checks for rental, bank accounts, credit cards and mortgages.

I really would ensure that all other routes have been fully exhausted (sitting down/sending a letter etc to the ex and explaining she will go bankrupt and this will leave him liable for all monies owed. In which he will either have to pay these debts and if he can't he will have to go bankrupt! etc etc) before deciding bankruptcy may be a route for her - it is a long frustrating and challenging road to getting her 'credit' life back......

Best of Luck