sharesd ownership

mayflowerdancer

Hello. I hope someone can help.
My daughter bought part ownership of a flat about 14/15 years ago. She bought 25% and a housing association owns the rest. For the last 4 years it has been on the market and has not sold. She has been paying out all the charges every month although she no longer lives in it. She cannot sublet or buy 100% and it is in negative equity.
We have been advised to hand the keys back and cancel all her direct debits by 2 different agencies . She understands that her credit rating will go down but is not too worried about this.
She has also just lost her job.
Has anyone any advice or experience of this? We would be most grateful for any replies.
Thank you

cattie

She needs to be careful as I believe if it's repossessed by the housing association & a sale realises a figure less than the outstanding mortgage, your daughter will be liable for the difference.

It might be worth contacting Shelter who probably are familiar with this kind of situation.

Chandler85

Has she considered contacting the housing association and asking if they are firstly interested in buying it back (negative equity will be the issue), because they often pay market rates for buybacks.


Or asking if they would consider becoming the landlord of the property and tenanting it as their property, maybe she can negotiate, not paying any charges but not reciecing any rent if the charges are that bad. Then if/ when the property is no longer in engative equity she can sell it back to them.


I work at a housing assocation and we are forever buying back properties, some new builds that were shared ownership, but mostly the old right to buys if i'm honest.

cjv

In case you are not aware, housing benefit can be claimed for the rent/service charge on shared ownership properties. You say she has lost her job, so claiming may be something that can help financially in the short term.

She would have to be living there though.

jonnygee2

We have been advised to hand the keys back and cancel all her direct debits by 2 different agencies .

What agencies advised you this? It's nonsense. She has an agreement with them to pay rent, if she doesn't pay it they will chase her down through the courts. You can't just sweep a legal tenancy agreement under the carpet!

A 'shared ownership' is actually a long term secured tenancy with the right to buy written into it. So she doesn't actually own anything at this point, I believe. I think it might be worth independent legal advice on whether the tenancy can be terminated (unless someone on this board can tell you!).


Also, I have to say I am curious - how can something still be in negative equity after 15 years?

mayflowerdancer

Thanks for your reply. It is a very difficult situation . The flat was worth £130.00 when she bought her 25% share. It eventually dropped in value and is now only worth £100.00 if that.
I am going to contact the hosing association again to see if they will buy it back as she will be unable to pay all the charges. We will see how we get on with that.

mayflowerdancer

Thank you for your reply.
I am going to see if the hosing association will buy the flat themselves in the cicumstances.

mayflowerdancer

Thank you for your reply.
My daughter does not live in the flat. She got married and that is why she put it on the market.

mayflowerdancer

Thank you for your reply. I will contact Shelter as you suggested.

Fire_Fox

mayflowerdancer wrote: »

Hello. I hope someone can help.
My daughter bought part ownership of a flat about 14/15 years ago. She bought 25% and a housing association owns the rest. For the last 4 years it has been on the market and has not sold. She has been paying out all the charges every month although she no longer lives in it. She cannot sublet or buy 100% and it is in negative equity.
We have been advised to hand the keys back and cancel all her direct debits by 2 different agencies . She understands that her credit rating will go down but is not too worried about this.
She has also just lost her job.
Has anyone any advice or experience of this? We would be most grateful for any replies.
Thank you

mayflowerdancer wrote: »

Thank you for your reply.
My daughter does not live in the flat. She got married and that is why she put it on the market.

Welcome to MSE.

I would strongly recommend your daughter takes her own independent advice from one of the debt charities or the Citizens Advice Bureau based on her current situation (married/ non resident/ unemployed). Her credit file will be linked to that of her husband.

The CAB may help your daughter prepare a letter to negotiate with the Housing Association. Relatives getting involved often mean information gets 'lost in translation'.

HTH.