Uncle sold a mortgage that finishes when he's 104

AnotherJoe

Rosie111 wrote: »

£10 a month for 20 years only adds up to £2400 paid. So over 40 years it would be £4800. I can't understand where the figures given come from. Or am I missing something?

Most likely that the uncle took out what in effect was an equity release scheme and perhaps was making the minimum statutory repayments.

theoretica

AnotherJoe wrote: »

Most likely that the uncle took out what in effect was an equity release scheme and perhaps was making the minimum statutory repayments.

I agree, I suspect that they were token payments set to ensure the debt didn't go statute barred or become forgotten about.

getmore4less

what are the details on the statements you have.

with more details can probably work something out


eg

20years ago rates would have been over 6%

6% on £4k that's £20pm interest only
paying £10pm
After 20 year £8.6k
After 40 year £23.8k

be interesting what the £19k included, might be just the total interest.

tumbledowngirl

getmore4less wrote: »

what are the details on the statements you have.

with more details can probably work something out


eg

20years ago rates would have been over 6%

6% on £4k that's £20pm interest only
paying £10pm
After 20 year £8.6k
After 40 year £23.8k

be interesting what the £19k included, might be just the total interest.

This is the initial letter from Halifax, from 1996.

Further Advance on Mortgage £5000
Monthly package costs £29.14
Interest rate 6.99%
APR 7.5% variable

480 gross monthly payments £13,982.40
Initial interest. £14.80
Admin. Fee £80.00
Revaluation fee. £65.00
TOTAL AMOUNT PAYABLE. £19,142.20


His last mortgage statement, January 2016 states that £136.08 was paid in the previous 12 months, but the interest was £136.12, so he finished the year owing more than he did at the start.

tumbledowngirl

Forgot to say, it looks like the loan started off as a further advance and at some point became a retirement home plan.
Bit confused about it starting as a further advance, because when it was taken out, my husband's uncle didn't actually have a mortgage with Halifax (it had ended 2 years previously).

Thrugelmir

tumbledowngirl wrote: »

His last mortgage statement, January 2016 states that £136.08 was paid in the previous 12 months, but the interest was £136.12, so he finished the year owing more than he did at the start.

4 pence is neither here nor there.

dunstonh

Thrugelmir wrote: »

4 pence is neither here nor there.

Probably due to rounding. 4p does not fit into 12 monthly payments.

Forgot to say, it looks like the loan started off as a further advance and at some point became a retirement home plan.

Not an uncommon journey. Debts moved into equity release to make life easier....

getmore4less

tumbledowngirl wrote: »

This is the initial letter from Halifax, from 1996.

Further Advance on Mortgage £5000
Monthly package costs £29.14
Interest rate 6.99%
APR 7.5% variable

480 gross monthly payments £13,982.40
Initial interest. £14.80
Admin. Fee £80.00
Revaluation fee. £65.00
TOTAL AMOUNT PAYABLE. £19,142.20


His last mortgage statement, January 2016 states that £136.08 was paid in the previous 12 months, but the interest was £136.12, so he finished the year owing more than he did at the start.

I will check the initial statement later

How much does the estate owe now?
Any details on things like current interest rate.

£140 in a year is a tiny debt or tiny interest maybe both.

If this initial rate was a variable tracker it could be very low.

JP08

tumbledowngirl wrote: »

Bit confused about it starting as a further advance, because when it was taken out, my husband's uncle didn't actually have a mortgage with Halifax (it had ended 2 years previously).

I know that when I "paid off" my old Halifax Mortgage I left a nominal amount (£100 if I recall correctly) on the mortgage. Halifax used to do a "Deedstore" thing in the days before the Land Registry being the be all and end all for property records. They also, if you left the Mortgage account running with a minimal amount, charged no interest and kept your deeds safe in Deedstore for free.

If the old boy had done something like this then borrowing again would probably show up as a "further advance".

tumbledowngirl

JP08 wrote: »

I know that when I "paid off" my old Halifax Mortgage I left a nominal amount (£100 if I recall correctly) on the mortgage. Halifax used to do a "Deedstore" thing in the days before the Land Registry being the be all and end all for property records. They also, if you left the Mortgage account running with a minimal amount, charged no interest and kept your deeds safe in Deedstore for free.

If the old boy had done something like this then borrowing again would probably show up as a "further advance".

Ah, that makes sense, thanks - I did find something to do with deedstore and keeping a £1 in the account for it to be free.