Mortgage: Voluntary repossession after BR?

jpr_74

Hi, here is a brief timeline of events:

June 2010: I split from my ex, move out of the house where we have a joint mortgage with no equity and declare myself BR. The mortgage is declared on the BR forms and is with Paratus.

May 2011: She declares herself BR, continues to live in the house and keep up the mortgage payments as the interest rates are so low.

June 2011: I am discharged from my BR.

Feb 2015: I find out that my ex had passed away, the payments for the mortgage have been up to date until this point. I have had nothing to do with the property, or made any payments towards it.

May 2015: The property is now placed in my name only and I am being chased for payments.

July 2015: I just want shot of the property - there is now £1600 in arrears but I don't want anything to do with it. Paratus suggest voluntary repossession.

Now am I still covered by by BR should there still be any arrears on the property even though it was in 2010? My new partner is worried about any future joint mortgage with me when this is needed 6 years after my BR as my credit file is going to look bad with just the mortgage showing arrears.

alastairq

Since the mortgage commencement pre-dated the date of BR petition, then the BR will include any shortfall of equity.

[Providing you have not,subsequently, signed any sort of 'deed of acknowledgement' of any shortfall, with the mortgagor?}

Be aware, however, that a re-possession will also be recorded, and whilst the existence of a past BR may put some mortgagors off, a past re-possession will put them off even more.

You are best to seek advice from a whole-of-market mortgage advisor when applying for a mortgage in the future.

silvercar

What is the property now worth? If there was no equity in June 2010, it doesn't mean that there is no equity now. You may find that there is sufficient equity to repay the mortgage and the arrears. Then there will be the question of who owns the benificial interest following both your bankruptcies.

fermi

Remind the company that:

1) Your BR means are not liable for the mortgage or any shortfall. Should they try to falsely claim that your are liable, then you will be reporting them to the FCA and taking the matter to the FOS.

See: http://forums.moneysavingexpert.com/showpost.php?p=63168439&postcount=3

2) Any default on your credit file resulting from non-payment or repossession MUST be backdated to the date of your bankruptcy.

See: http://debtcamel.co.uk/credit-file-after-bankruptcy/ and https://forums.moneysavingexpert.com/discussion/5197584 and https://forums.moneysavingexpert.com/discussion/5225121

Again, if they refuse then tell them you will be taking them to the FOS, and remind them of the cases in the above links.

(3) In the meantime remind them that as you are not liable for the mortgage payments they should not be recording missed payments/arrears on your file. Recording such payments would be inaccurate and be a misrepresentation of your liability to anyone checking your credit file.

See FOS cases here https://forums.moneysavingexpert.com/discussion/4873346

cancatsdance

From my experience ( and i walked away from two mortgages and left them the keys ) i had to wait 3 years from dischage before i got another motgage

this re-possession will also be recorded ?????? recorded where

jpr_74

fermi wrote: »

Remind the company that:

1) Your BR means are not liable for the mortgage or any shortfall. Should they try to falsely claim that your are liable, then you will be reporting them to the FCA and taking the matter to the FOS.

See: http://forums.moneysavingexpert.com/showpost.php?p=63168439&postcount=3

2) Any default on your credit file resulting from non-payment or repossession MUST be backdated to the date of your bankruptcy.

See: http://debtcamel.co.uk/credit-file-after-bankruptcy/ and https://forums.moneysavingexpert.com/discussion/5197584 and https://forums.moneysavingexpert.com/discussion/5225121

Again, if they refuse then tell them you will be taking them to the FOS, and remind them of the cases in the above links.

(3) In the meantime remind them that as you are not liable for the mortgage payments they should not be recording missed payments/arrears on your file. Recording such payments would be inaccurate and be a misrepresentation of your liability to anyone checking your credit file.

See FOS cases here https://forums.moneysavingexpert.com/discussion/4873346

So even though the mortgage remained in a joint name, and she continued to pay the mortgage (with my name still on it), and the receiver did not repossess the property when she also went bankrupt - Paratus cannot chase me for this as I declared the property as an asset on my BR form?

And when the property is sold, shortfall or not, I am not liable and can contest this?

fermi

Correct. Only way you can make yourself liable again is if after the date of your BR YOU sign an acknowledgement agreeing to be liable.

If you did not sign any such paperwork then you are not liable, no matter what else may have been done.

jpr_74

Just bumping this thread......

I wrote to Paratus with a complaint regarding the liability of the mortgage, and they have just replied to me, saying that the are unable to uphold my complaint and I remain the sole borrower.

I have also discovered that the mortgage was setup as "Tenants in common", and my ex-partner (to my knowledge) did not have a will. Therefore as I understand it, her oldest son would be the beneficiary of her side of the mortgage.

Also my beneficial interest was sold to a 3rd party at the time of my BR.

Any further advice would be appreciated.....

fermi

In that case contact the FOS and ask them to write to Pardus.

http://www.financial-ombudsman.org.uk/consumer/complaints.htm

Paratus can reject your complaint all they like, but you are still not legally liable.

May also be worth speaking to your old OR to see if they will write to them. Sometimes they will even after that many years. Sometimes they won't. But you can at least ask.

jpr_74

Well this was the response I received:

"I refer to your letter received on 31 July 2015. I am sorry that you have had cause to complain and thank you for taking the time to bring this matter to our attention

I understand your complaint to be that you believe as you have previously been declared bankrupt the mortgage was included in the bankruptcy and you therefore no longer responsible for this debt.

I have reviewed the account and note that the information you provided you were declared bankrupt on 7 June 2010 and we have received the documentation to confirm this.

I also understand originally the account was in joint names with ***** ***** who sadly passed away in January 2015 and whose name has therefore been removed from the mortgage.

I can confirm that when a mortgage is taken out in joint names both parties are jointly and severally responsible for the mortgage debt.

I also have to advise that while a mortgage can be included in a bankruptcy this is dependent on the lender agreeing to this. If the lender choses to rely on their security for the mortgage debt, which is the property, the mortgage is then not included in the bankruptcy. I have to advise that Paratus AMC Limited would always choose to rely on our security for the mortgage.

I can confirm therefore that as the sole remaining borrower you remain liable for the mortgage debt despite being declared bankrupt in June 2010.

I am sorry that you have had cause to complain, but I am unable to uphold your complaint in this instance. The mortgage was not included in the bankruptcy as we did not agree to this and chose to rely on our security for the mortgage debt"


Can Paratus do this and where do I stand with regards to this and my bankruptcy?

I have already contacted the receiver and they said that the property was included in the bankruptcy and they had also contacted Paratus 2 weeks ago on my request. So far I have had no response from them.

Thrugelmir

jpr_74 wrote: »

Therefore as I understand it, her oldest son would be the beneficiary of her side of the mortgage.

You cannot inherit a mortgage.