Mortgage shortfall after repossession

bassett111

Ok. Got into trouble during 2008 Icelandic bank collapes. Have many C.cards in default. 2010 offered the buy to let mortgage co. the 6 months arrears but they had already instructed receivers. tenant got scared after THEY contacted him and promptly left.

They gave management to an estate agents about 20 miles away, not in the area at all. Flat was not rented at all whilst they had it. Then about a year later they auctioned it for a big discount leaving me with £21000 shortfall. A year later they added and extra £5000 for reasons unknown.

Can I get this written off due to the fact that they did not rent it out and therefore this would have at least covered the interest plus some arrears. Also they sold it for a knock down price in 2011. the last flat that sold for this price was in dec 2002. since 2011 the prices have all been a lot higher that their sale. (15000-20000 more).

My reason for asking is that I didn't realise this stayed for 12 years not the usual 6 years and I want to get another mortgage again in a year when the C.cards have finished.

chasingfreedom

No I'm afraid its very unlikely you'll get anything written off. They aren't obliged to go out of their way to rent out your property to prevent you incurring costs. It's also standard practise for them to auction off your property at a rock bottom price just to get rid of it. There is very little you can do about it as you basically defaulted on your mortgage.


I've never heard that a shortfall stays on your file for 12 years though, not sure if anybody else can confirm that? I thought 6 years was the maximum for everything.

chasingfreedom

Actually though I just found this on the national debtline website which might be useful to you -


If you think any of the examples below apply to you, contact us for advice.

• The house was sold for a lot less than the market value at the time of sale.
• The house was not marketed well enough to obtain the best price.
• You arranged a sale which was refused by the lender, but after repossession the house was sold by the lender for a much lower price.
• If the house stood empty for a very long time, you may be able to argue that the mortgage company should have rented it out and therefore off-set possible rental income against the shortfall balance.
• Check who bought the property. Your lender should not have sold it to a related company.

Maybe you should give them a call and see what they say?

National_Debtline

chasingfreedom wrote: »

I've never heard that a shortfall stays on your file for 12 years though, not sure if anybody else can confirm that? I thought 6 years was the maximum for everything.

Hi CF


The significance of 12 years here is that it is the period within which the mortgage lender has to start legal proceedings to recover any capital owed from the shortfall. For any part of the shortfall which is interest, the usual six-year limitations period applies. This doesn't mean the debt shows on one's credit report any longer than usual, however.


I hope that clears things up a little!


Dennis
@natdebtline

bassett111

Thanks CF That's what I found as well. That led me to the questions.
Again thanks ND. So they could start right at the end of the 12 years , get nothing from me but I'd have this debt for a further what?...6 years?
I think the capital would be about 7000 short. Never had any paperwork at all as I had moved. didn't want to contact them in case they start the clock again (for 12 years?)