Help needed regarding reposession

propertyrental

I agree it seems unlikely the bank would start repossession procedings so soon.
However if they discovered the property is rented out, with no CTl or BTL, in clear violation of the mortgage agreement, they may have decided to take action. But I'd have expected them to write to the OP first - were there no warning letters sent/received?

If the bank does repossess, in a case where there is a tenant, but no 'authorised' (by the bank) tenancy, the court will give the tenant 2 months and then evict:
Mortgage Repossessions (Protection of Tenants etc) Act 2010

It must surely be worth having a conversation with the bank. Maybe email first and set up a time for a long distance phonecall. If they believe you are addressing the problems (both the arrears and the lack of CTL/BTL), they may well postpone the hearing. But you'll need a clear plan to offer them for both problems.

If you can buy yourself time, you'll then need to either get the tenant to start paying (sounds unlikely) or serve a S8 first, evict, and then get a new tenant in - and this time do it properly! Whatever you say about your letting agent, you seem to have been very badly advised (or else you ignored good advice).

Auction is an option but you'll take a large financial hit. An investor or experience landlord might be willing to take on the tenant/tenancy, but only if they can see profit- which means the price will have to compensate for the problems and costs of taking on this property.


Post 6: Repossession: what if a LL's mortgage lender repossesses the property?

macman

You say that the agent has been 'very good', but they a) failed to issue an S8 after 2 month's arrears, b) failed to check you had a BTL mortgage or consent to let, and c) failed to contract the tenant with a written AST? It doesn't inspire much confidence in them.
Sorry but I just don't believe this is the whole story.
It's very likely that any attempt to get a possession order will fail, as it's fairly inevitable that your tenancy is not regularised in some respect (deposit protected, GSC, EICR, How to Rent booklet etc?), and even once this is resolved, it will be well into the spring before you could actually evict the tenant.

panda4556

No this is the whole truth I have no reason to lie 

panda4556

macman said:

You say that the agent has been 'very good', but they a) failed to issue an S8 after 2 month's arrears, b) failed to check you had a BTL mortgage or consent to let, and c) failed to contract the tenant with a written AST? It doesn't inspire much confidence in them.
Sorry but I just don't believe this is the whole story.
It's very likely that any attempt to get a possession order will fail, as it's fairly inevitable that your tenancy is not regularised in some respect (deposit protected, GSC, EICR, How to Rent booklet etc?), and even once this is resolved, it will be well into the spring before you could actually evict the tenant.

The tenant has no agreement in place the estate agent adviced me to get a btl I didn't get round to it as I'm abroad bereavement do you think I should tell the bank that I'll volunteer repossession plz advice me further. I have no idea what to do & this is all my life time hard with into this house 

propertyrental

macman said:

....
It's very likely that any attempt to get a possession order will fail, as it's fairly inevitable that your tenancy is not regularised in some respect (deposit protected, GSC, EICR, How to Rent booklet etc?), ..

None of that would prevent use of a S8 Notice. They would result in rejection of a S21 Notice, but that's not relevant in a case of (2+ months) rent arrears..

propertyrental

panda4556 said:

macman said:

You say that the agent has been 'very good', but they a) failed to issue an S8 after 2 month's arrears, b) failed to check you had a BTL mortgage or consent to let, and c) failed to contract the tenant with a written AST? It doesn't inspire much confidence in them.
Sorry but I just don't believe this is the whole story.
It's very likely that any attempt to get a possession order will fail, as it's fairly inevitable that your tenancy is not regularised in some respect (deposit protected, GSC, EICR, How to Rent booklet etc?), and even once this is resolved, it will be well into the spring before you could actually evict the tenant.

The tenant has no written agreement in place. There is a tenancy agreement, just not a written one.
 the estate agent adviced me to get a btl I didn't get round to it as I'm abroad bereavement. Sympathies however - the mind boggles....
 do you think I should tell the bank that I'll volunteer repossession.

As advised, speak to the bank!. Offer to
* pay off arrears, giving a clear undertaking of by how much and over what period.
* switch to a CTL or BTL mortgage. Explain about the bereavement, and how little time you had before going abroad. Agree to whatever increased mortgage costs BTL involves
If you are convincing, and lucky, the bank will re-consider. They don't actually like repossessing......

Alternative is to offer voluntary repossession but that, or court repossession, will cost you more. A lot obviously depends on whether you can access some money to reduce (or better still remove) the arrears.

Meanwhile get your agent to serve a S8 immediately. Quite often that is enough to incentivise a tenant to pay (at least some) of the rent arrears.....

SameOldRoundabout

This is so confusing. So you rented out the property in March. Already 1 missed payment. No tenancy agreement, reduced rent, no deposit. 

June another missed payment due to tenant this time. 

October another missed payment. 

Lender then immediately issued proceedings to repossess the following month?! 

It seems very unlikely and rushed. Have you actually spoken to them and tried to arrange a payment plan? Why are you still abroad when you’re too poor to eat and certainly can’t fulfill your mortgage obligations. Why is there no tenancy if you have an agent? 

Tiglet2

panda4556 said:

macman said:

You say that the agent has been 'very good', but they a) failed to issue an S8 after 2 month's arrears, b) failed to check you had a BTL mortgage or consent to let, and c) failed to contract the tenant with a written AST? It doesn't inspire much confidence in them.
Sorry but I just don't believe this is the whole story.
It's very likely that any attempt to get a possession order will fail, as it's fairly inevitable that your tenancy is not regularised in some respect (deposit protected, GSC, EICR, How to Rent booklet etc?), and even once this is resolved, it will be well into the spring before you could actually evict the tenant.

The tenant has no agreement in place the estate agent adviced me to get a btl I didn't get round to it as I'm abroad bereavement do you think I should tell the bank that I'll volunteer repossession plz advice me further. I have no idea what to do & this is all my life time hard with into this house 

You have a property worth £300k and an outstanding mortgage of £86k.  Leaving aside the issues with the tenant, you should have been speaking to your mortgage lender about restructuring your repayments to something you could afford.  You should NOT voluntarily hand the property back. 

If you speak to the Bank, they will usually work with you to come to a mutually acceptable solution.  They may offer to extend the term so that your monthly repayments are reduced, for example.  They may agree to a temporary payment holiday or to go onto an interest free mortgage until you were in a better position financially.  If you ignore your bank or refuse to speak with them, they won't help you.

You also need to tell the bank you need their consent to let the property or that the mortgage needs to be changed to a buy-to-let one, now that you are no longer living in the property.  I'm not sure how the lender will view this, but you do have a decent amount of equity so hopefully it can be agreed.

You will need to persuade the tenant to leave, maybe by offering a reasonable sum of money for him to go, if the tenancy was not set up properly and, as yet, no Section 8 Notice served.  

When you were living in the property, how did you manage to pay your mortgage?  Have you stopped working since going abroad in March?  Are you planning to come back at all?

london21

panda4556 said:

london21 said:

If you are renting, you will want your tenant to pay each and every month but have to have some funds in case they fall behind that one does not fall behind with the mortgage.

If you were to sell with auction with tenants in, might not get the best return. 

You mentioned tenant behind 2 months' rent, but you had fallen behind payments even before the property was rented.

Repossession might not get the best return also as the bank will focus on getting their funds and paying costs then you get the remaining. 

All the best. 

Don't the bank have a legal duty to sell for the best price?

They do but because it is repossession can be lower than normal sales.

They are motivated to sell so timing etc all play a part. 

babyblade41

I'm sorry I don't buy any of this story.

A bank won't get a possession order in such a short space of time, firstly on such a small amount owing versus  value of asset they would sort out a repayment plan.

What were you doing for work before you left to go abroad , especially as you have been over paying.

None of this makes any sense at all , least of all the story of the EA .