Mortgage discharged by mistake?

garythehutch

Hi everyone

I am hoping for some clarity.

Long story short, I've found out that the mortgage on my property was discharged by the bank last year. I have confirmed this with HM Land Registry and double checked it. This looks to be some sort of mistake on the banks part.

My question is:

Can I take advantage of this mistake legally and advise my bank that I no longer have to pay the outstanding funds on the mortgage AND/OR would I be due to be refunded on the mortgage payments I have made since last year?

If so, where do I start? Do I go to a solicitor or do I go to the bank directly?

ACG

You have signed an agreement with them.
You still have to make your payments whether or not it is secured against the property. The same as if you took out an unsecured loan.

garythehutch

I've made an agreement with them, yes... but they have declared that that agreement has been settled with the Land Registry.

So technically, the money I am still giving them monthly, where is that going? It isn't to work towards settling the agreement I had signed, as that's been legally settled?

Maybe I am over simplifying it but surely this is a monumental !!!!-up?

Wh05apk

garythehutch wrote: »

I've made an agreement with them, yes... but they have declared that that agreement has been settled with the Land Registry.

Where/how did they declare the agreement was settled? All they have done is removed the security, effectively now you have an unsecured mortgage, but you still owe the capital.

garythehutch

The Land Registry informed me verbally after accessing their systems that the bank had declared it settled.

And if they've made a mistake that has caused me to have an unsecured mortgage, when I signed up for a secured mortgage, then surely that's a breach of terms? So why would I pay for something that I didn't sign up to?

Just playing devils advocate with these questions.

ACG

Your agreement would have said you will pay £xxx per month for however many years.

As part of that agreement they secure that debt against the house.

Whether it is still secured against the house or not, you still agreed to pay £xxx per month for however many years.

Even if it is not showing on the deeds, they are still legally entitled to their money back and I would imagine they have the paperwork to back it up.

GMS

You know it to be an error and admit you owe the money.

If the bank have mistakenly releasd the charge then the charge may well be unenforceable. The debt however remains as unsecured if that is the case.

Defaulting would lead to recovery of debt and ultimately bankruptcy. The debt is there. You may well get a gesture of goodwill from them but I am 99.9% sure the debt won't be written off.

TrickyDicky101

You won't successfully argue your mortgage contract has been frustrated because of this mistake on their part. You still owe the money.

If you really want to take advantage, sell the house, pocket all the proceeds and do a runner before settling your (now unsecured) loan balance with the bank.

stator

Don't tell them about it. Continue paying your mortgage. If in the future things go horribly wrong for you and end up defaulting on your mortgage, you may benefit from their error.
If you point it out now they may well try to correct it. The T&C of the mortgage probably mean you would have to help them do this.

anselld

They took the charge off by mistake. They can no doubt put it back on just as easily.

getmore4less

If you structure your finances correctly and don't own the house(joint tenants is not going to work).

Then die there is a chance the debt could be written of.