repossession and bankruptcy

jar16

Is almost a year too long to accept for the lender on my repossessed house to appoint a asset manager to take over and sell the house it 2 more months to sell it
I went bankrupt 6 weeks after the repossession
SSE are telling I must still pay the daily standing charges for gas and electric from the date I left until the lenders sold date

National_Debtline

Hi jar16 and welcome to the forum.


Did you inform SSE at the time that you were leaving the property, and did you supply a final set of meter readings before leaving?


If so, you should be able to argue that liability from that point on lay with the lender.


If not, things might be a little less clear-cut.


At the very least, you can argue that any standing charges incurred between your repossession and the date of your bankruptcy cannot be pursued, as these should be included in your bankruptcy.


You may also be able to argue/complain to the mortgage lender that their duties in "managing" the property after repossession should have included notifying any energy suppliers and/or arranging for utilities to be turned off altogether. This complaint could potentially be escalated to the Financial Ombudsman Service. However, that would be a dispute between you and the lender, rather than with SSE.


There is no precise definition of exactly how long is "reasonable" for a lender to take to market and sell a repossessed property. You can, however, refer to the guidelines in the FCA Handbook:


http://fshandbook.info/FS/html/FCA/MCOB/13/6


Things may be a little clearer if you can get your hands on any supply contract you took out with SSE. If one exists but you do not have a copy, they should have a copy on file that they can provide you. The terms and conditions of this contract may help to clarify who is responsible for standing charges in this sort of scenario.


Dennis
@natdebtline

footyguy

Are you sure about the lender being responsible for utility bills, Dennis?

The OP has posted essentially the same question previously here, to which I have responded. (in particular post#6)

https://forums.moneysavingexpert.com/discussion/5193719

As I understand it, the owner (and the OP still is the legal owner until the property is sold Edit:maybe not if the OP then went rankrupt? ) remains liable for all the attributable costs to the property.
That's not just utilities, but things like mortgage payments, insurance cover, maintenance costs and even council tax.

The lender does usually isolate all supplies (gas, electric, water, etc) when a property is repossessed, but all that does is prevents further usage; standing charges will still accumulate at the applicable rate.

They only isolate the supply - they do not request to have it cut off. Doing so would not only adversly affect the property sale price (and may incur costs), but would result in high costs of reconnection - typically £100s or more for any buyer.

With energy, either the customer takes out a contract or one is deemed to exist by that customer having used such energy supply (which presumably they did when they lived in the property prior to eviction)

There are also terms on how such an existing contract may be ended. Usually it is by someone else taking over, or deemed to take over, responsibility for the ongoing supply e.g. by sale or let of the property.

It could be possible for the OP to request disconnection of the supplies, but that is unusual and usually not recommened for similar reasons to that I have already given. (and the OP cannot grant the supplier access to the property to disconnect the supplies anyway)

I do not accept the lender takes any responsibility for the ongoing costs associated with the property, but even if they are, do you think the banks and building societies ring round the suppliers to take over supply contracts on properties that are repossessed - they are unlikly to know which actual supplier does supply.
(There is no possibility of a deemed contract with the lender either because as I say, they do not actually use any of the supply)

Someone is expected to pay for the supply.

I believe the OP remains responsible for the ongoing costs attributable to the property until it is sold ... and is then liable for the sale costs too.
What the OP could do is use a comparison site to find the best deal for them. Not all suppliers apply a standing charge (in fact a white label of the existing supplier offers such a tariff )
A supplier does not need access to a property to take over the supply.


If the OP is going bankrupt anyway, can't they include all such debts, at least those accrued up until bankruptcy, in such a bankruptcy?
(I know little about bankruptcy, but just a thought)

In response to the particular question the OP raises here initially, I would have thought a year from reposession to sell a property is too long, especially in todays market (although that could depend on location I suppose).
That doesn't sound like losses have been mitigated, and since as I say the OP would still be liable for mortgage payments (amongst other costs) during this time, it would be hard to argue the sale was delayed whilst they obtained the best price.
(The "best price" has to include the speed at which the sale goes through, and so limits the ongoing costs to the existing owner)

I remember back in the height of the credit crunch (when very few people if any were buying, because no one could borrow any money) some repossessed properties were instead let by the mortgage company in possession to limit ongoing costs to the owner.

(Once you put a tenant in, most of the ongoing costs are then the responsibility of the tenant, and those that are not are hopefully more than covered by the rental income)

luvchocolate

I had 2 properties repossessed in January 2012 went B.R in August same year, once the houses were taken by the lender they paid the council tax...it took 2 years for one house to be sold with a massive shortfall which went into the B.R

footyguy

luvchocolate wrote: »

I had 2 properties repossessed in January 2012 went B.R in August same year, once the houses were taken by the lender they paid the council tax...it took 2 years for one house to be sold with a massive shortfall which went into the B.R

That was nice of them

[STRIKE]
Are you sure they didn't simply add the costs to the amount outstanding which, as you say, did eventually result in "a massive shortfall"?
[/STRIKE]

Edit: Actually it seems a property becomes exempt from council tax from date of repossession (assuming it remains empty) until sold
https://www.gov.uk/council-tax/second-homes-and-empty-properties

luvchocolate

the massive shortfall was due to my ex who continued to live in 1 property and in spite of having a declaration of trust for him to pay the mortgage while he lived there he did not and the shortfall was due to the fact he stripped the house of kitchen and bathrooms before he was evicted...it was heartbreaking.