Housing Crisis Puzzle

rosegold

Hello!

Have been reading these forums for many years without joining but after today's drama, I have decided to join to see if any of you lovely lot can help! I'm sorry, it's a little complicated and long!

A little background - there is me, my partner and our 3 children. In December 2016 we moved into our perfect home which we rent for £1200 a month. Here come the issues....

Today we received a letter from (our landlord's) mortgage lender's solicitor, saying that they will be going to court and repossessing the property, I presume due to non-payment of mortgage.

After doing some googling today we realise we have no rights what so ever and will have to be out when the lender takes possession which will be in a matter of weeks. Here is the tricky bit...

The property we are in, took us a year to find and I don't think we'll be able to do it again! Basically....

I have a lot of debt and several CCJ's on my file due to a failed business several years ago. My partner has no debt. We were able to get this place only by paying 12 months rent up front :eek: which was funded by money saved by partner. The letting agent we got this house through were the only agent in our area that would accept us by paying upfront. We tried several agents before and lost money due to this. Both my partner and I are self employed and have no chance of getting a mortgage. We don't have quite enough money to pay another 12 months upfront, even if we could find someone who would take us on.

We have been told that we would be eligible for help from the council by the letting agent...but as we have some capital surely they won't help! We should *fingers crossed* get our money back that we've paid upfront for the remaining term...but this won't be until after we've moved out. We also have no friends or family in the town we live in to be able to stay with them for a short time.

So what the bloody hell do we do in this situation?

The issues in a nutshell:

1. CCjs on file - so no landlord/letting agent will take us on
2. Both self employed
3. Small amount of capital - not enough to pay 12 months

Any advice, shoulders to cry on would be very much appreciated

sparky130a

For a start, stop listening to this shister of an agent. The mortgage company become your landlord.

I have no expertise other than that but others will. All fails, give Shelter a call.

G_M

Read:

* Repossession: what if a LL's mortgage lender repossesses the property?

easilydistracted

What makes you think you have no rights? You have a legal tenancy. The mortgage company have certain responsibilities. Check with Shelter before you do anything. You will be in priority need for council as you have children but only if you don't leave voluntarily. They will do everything they can to help you find something else to avoid housing you. People with savings generally get lower housing priority by a slight margin but the homelessness rules are different. Good luck

rosegold

Thank you everyone. G_M that post is really useful. I will find out immediately if the landlord has the correct type of mortgage which I highly suspect he doesn't.

With regards to the rights, this is taken from Citizens Advice:


If your landlord falls behind with their mortgage payments, their mortgage lender could take them to court to get possession of the property. This will usually give them permission to evict anyone who lives there, including tenants.

In most cases, if the mortgage lender has been granted a possession order, you will have no right to stay in your home.

G_M

rosegold wrote: »

With regards to the rights, this is taken from Citizens Advice:

If your landlord falls behind with their mortgage payments, their mortgage lender could take them to court to get possession of the property. This will usually give them permission to evict anyone who lives there, including tenants.

In most cases, if the mortgage lender has been granted a possession order, you will have no right to stay in your home.

I disagree with the use of both underlined words, and would substitute "may" and "some" respectively.

I refer you for more detail to my link above, and the legal references within it.

Grant_Urismo

Look at this from the lender's point of view:

If they try to kick you out, they are potentially starting an expensive battle that they might not win, and if they do win, they will be left with an empty house and no rent coming in.

Or they could just get you to pay them rent each month.

It really doesn't make sense for them to kick you out, the house is worth more with you than without you!

davidmcn

Also bear in mind that many repossession actions don't progress to the bitter end - borrowers often find enough cash under the mattress to pay off the arrears at the last minute. Obviously you need to be prepared for the worst to happen though.

franklee

rosegold, I am sorry to hear this is happening to you.

I certainly echo that you read G_M's post and the items it links to.

If your landlord has a BTL mortgage or a residential mortgage with consent to let then you will be OK as your fixed term tenancy will be respected.

If a residential mortgage with no consent to let then it's likely you will only get the extra two months granted by the Mortgage Repossessions (Protection of Tenants etc) Act 2010 should the repossession go ahead. The latter leaves you short of approx. six months rent that you have paid in advance. In theory the landlord will owe you this rent, in practice will he have the money to pay you back if he is being repossessed? The letting agent should have checked for consent to let and there is the possibility you can sue them as well as the landlord. It's more likely they would have the funds to pay up.

Next time, especially if paying a lot of rent upfront, check that any mortgage lender has consented to the let or that it's a BTL mortgage before you hand over the money.

Freecall

The quote from Citizens Advice is correct but has been phased so badly that it has left you with the wrong impression of where you stand.

Looking at the quote objectively (while understanding your rights in advance) the truth of the situation can be seen : -

rosegold wrote: »

If your landlord falls behind with their mortgage payments, their mortgage lender could take them to court to get possession of the property.

Yes of course, they have a right to enforce the charge they hold on the property. From what you say, this is exactly what they are doing.

This, in itself however, does not change anything for you except that the mortgage lender now effectively becomes your landlord.

rosegold wrote: »

This will usually give them permission to evict anyone who lives there, including tenants.

Yes but only on the same basis as any other landlord. If you did not pay the rent for example or broke some other significant term of your tenancy agreement they would be able to go to the court and ask for a possession order. They would also be able to do this if you did not leave at the end of your tenancy.

rosegold wrote: »

In most cases, if the mortgage lender has been granted a possession order, you will have no right to stay in your home.

Again, in a sense they are stating the obvious. If a possession order is granted then the court will allow them to enforce it.

The real question is, will a possession order be granted?

The answer is, only if you are in breach of a significant term in your tenancy agreement or if you fail to leave at the end of your tenancy.

So your current situation is secure.

The back story is that in your particular situation you had hoped to stay longer than your current 12 month period and they are unlikely to allow you to do so. That however is another story.

Console yourself with the fact that your original landlord may not have allowed it either.