Mortgage Payment Holiday Ended

MattMattMattUK

HUMBUG said:

So the situation at the end of this year (end of mortgage period), my brother will be owing 40k . If Nat West insist on the arrears being paid and go ahead with their threat of repossession via the courts can my brother find a broker to borrow 40k to pay off Nat West and then repay them over 2 years  (using his £1m house as security)?  My brother is able to pay 2k a month at the moment so its not as if he can't pay off the mortgage or a loan from another lender , just needs a few more years.

He can go to a broker, he may be able to get a mortgage, it entirely depends on his circumstances, however finding out will cost him nothing. An alternative may be a personal loan but again that depends on personal circumstances. 

HUMBUG said:

I've heard of something called a bridging loan that can be extended to 2 years if necessary. 

Bridging loans are very difficult to get, not normally for this kind of circumstances, attract rates of 4% or more per month and are not usually granted for periods longer than a few months.

HUMBUG said:

Would the FCA have a list of regulated brokers that might help my brother out ?

No they don't. You could find a broker locally, find one online, or head over to the mortgage board as there are several very good ones on there. You have to approach them as forum rules do not allow them to approach you, pick one you like and send them a message. 

onashoestring

To avoid repossession your brother needs to a plan in place to pay off the £40k arrears from not paying his mortgage for 1 year. No point in waiting until the lender starts the repossession process, they have given sufficient warning about the penalties for not paying off the debt by the end of the mortgage term. The earliest this can be sorted the better. 

silvercar

I’ll move this over the the mortgage sub board, as this has strayed from a coronavirus question to a mortgage one.

best of luck OP.

getmore4less

HUMBUG said:

So the situation at the end of this year (end of mortgage period), my brother will be owing 40k . If Nat West insist on the arrears being paid and go ahead with their threat of repossession via the courts can my brother find a broker to borrow 40k to pay off Nat West and then repay them over 2 years  (using his £1m house as security)?  My brother is able to pay 2k a month at the moment so its not as if he can't pay off the mortgage or a loan from another lender , just needs a few more years.

I've heard of something called a bridging loan that can be extended to 2 years if necessary. 

Would the FCA have a list of regulated brokers that might help my brother out ?

Since this all kicked off early 2020 with 3 years to go wondering why you could not step in to help with the shortfall
Probably could have avoided the IVA.

Earlier you said they asked for a 17 month extension with 40k outstanding that's £2,353pm  why are they not paying at least that now how will they have been able to afford it after the end of the year?

if they are about to get private pensions won't there be an option to take a tax free lump sum

Could they not have started them earlier to get extra cash and increase income?

MWT

It still feels like there is something missing from this narrative as there have been options to resolve this since the start given their age and the amount of equity in the property.

Always difficult when it is not the actual parties concerned that are posting...

csgohan4

They will have difficulty getting another  mortgage as their credit file will be tarnished by all those missed payments and arrears. No right minded lender would will likely touch them given their history

They have been given more than a  year to sort this out, this is a contractual loan, your not lending from Johnny down the pub who can give you some extra time. 

This is regulated lending, Your home is at risk if you don't keep up repayments which is the case. The lender has been reasonable in allowing this for  1 year. 

They have not mitigated their costs, they could have sold their home and downsized. Going through a Repo will incur significant costs through their own choice I'd afraid. Your clutching at straws 

https://england.shelter.org.uk/housing_advice/repossession/repossession_rules_mortgage_lenders_must_follow

MWT

With as much equity as there is in the property, and being 66 years old, if the brother's wife is over 55, then although not the cheapest route, equity release would seem the obvious way to resolve the problems if the property is suitable and other alternatives (including down-sizing) have been eliminated...

ACG

https://register.fca.org.uk/s/ - The FCA do have a register of mortgage brokers, scroll down a little and you will see a tick box for mortgages. 

HUMBUG

getmore4less said:

HUMBUG said:

So the situation at the end of this year (end of mortgage period), my brother will be owing 40k . If Nat West insist on the arrears being paid and go ahead with their threat of repossession via the courts can my brother find a broker to borrow 40k to pay off Nat West and then repay them over 2 years  (using his £1m house as security)?  My brother is able to pay 2k a month at the moment so its not as if he can't pay off the mortgage or a loan from another lender , just needs a few more years.

I've heard of something called a bridging loan that can be extended to 2 years if necessary. 

Would the FCA have a list of regulated brokers that might help my brother out ?

Since this all kicked off early 2020 with 3 years to go wondering why you could not step in to help with the shortfall
Probably could have avoided the IVA.

Earlier you said they asked for a 17 month extension with 40k outstanding that's £2,353pm  why are they not paying at least that now how will they have been able to afford it after the end of the year?

if they are about to get private pensions won't there be an option to take a tax free lump sum

Could they not have started them earlier to get extra cash and increase income?

I only live on £870 p/month from my company pension so I don't have any easy available money to help him out.   In October my brother will be due his state pension (not much because he worked abroad in Belgium & Germany for most of the last 20 years) and he will also be due a small company pension from an IT company (when he was working in the UK). He is also hoping for a pay rise in April and a bonus in July . Currently even his 2k payment per month is seriously in peril because of the massive increase in utility bills , food prices , etc so he might need to ask for a 3-5 year extension. He is 65 at the moment but he won't be retiring until he is in his seventies (at least). The IT company pension is only paid in the form of an annuity , so no option to get a tax free lump sum.

HUMBUG

csgohan4 said:

They will have difficulty getting another  mortgage as their credit file will be tarnished by all those missed payments and arrears. No right minded lender would will likely touch them given their history

They have been given more than a  year to sort this out, this is a contractual loan, your not lending from Johnny down the pub who can give you some extra time. 

This is regulated lending, Your home is at risk if you don't keep up repayments which is the case. The lender has been reasonable in allowing this for  1 year. 

They have not mitigated their costs, they could have sold their home and downsized. Going through a Repo will incur significant costs through their own choice I'd afraid. Your clutching at straws 

https://england.shelter.org.uk/housing_advice/repossession/repossession_rules_mortgage_lenders_must_follow

Yes, his credit rating is very low now and Nat West seem determined to push through with repossession and haven't responded in writing to confirm rejection of his proposal/request  to pay off the debt over an extended term (its been 18 months to and fro with lots of contradictory replies agreeing with the proposal first and then rejecting it - all via telephone conversations).  He has requested a transcript of all telephone conversations with Nat West for the period of arrears.

There is some sort of protocol that must be followed before the case goes through to the courts but hopefully Nat West will negotiate a payment plan. 

My brothers house is worth £1m but it seems that is irrelevant because the terms and conditions request payment within the mortgage period (ie. end of this year).  Maybe he will strike lucky with finding a broker to facilitate a loan to pay off the arrears and offer him several years to pay it off (unlike Nat West). 

The FCA guidance does say the following:
Your lender should not repossess your home unless all reasonable attempts to resolve the situation have failed.

Alternatives to repossession

With your agreement the lender should consider whether to:

• delay interest payments

• extend your mortgage term

• change the type of mortgage you have

• add the arrears onto your total mortgage debt

They should allow you time to sell your home if you can't come to a repayment arrangement.

They must keep records of their contact with you including phone calls where arrears or charges are discussed.

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It all depends on the lender but it seems Nat West are not interested is considering the alternatives above so they can do whatever they want and ignore the FCA guidelines.