Repossession - Employing a Solicitor to Negotiate With Building Society

EndofMortgage

We live in Surrey and our interest only mortgage deal ended some time ago. We continue to pay the interest and have never missed a payment. We would like to stay in the property for another year before downsizing but the building society are threatening repossession. The outstanding mortgage is about a third of the market value of the house so there is lots of equity protection for the building society. A new mortgage isn't possible as we are retired. We would like to employ and pay for a solicitor to negotiate with the building society as neither of us feel we are capable of doing that. 

Is there somewhere I can get a list of solicitors who have experience in mortgage repossession matters and has got a reasonable fee structure or does anyone have advice on how to go about finding one?

housebuyer143

You are in breach of the contract so I'm not sure what you expect a solicitor to do. Have you considered a lifetime mortgage or retirement interest only? 

Flugelhorn

agree it sounds like you need to change the type of mortgage you have, have you had such discussions with the building society?? 
Or maybe need to get on with the downsizing - suspect they won't go ahead with repo if you are actively selling 

MattMattMattUK

You have two ways to stave off repossession, clear the mortgage by obtaining funds elsewhere, as others have said a lifetime mortgage is probably the only (expensive) route to that, or clearing the mortgage by selling the property. 

You say that the mortgage ended some time ago, your contract with the lender will have meant you needed something in place in time for that, not just when you felt like it months/years after that. You mention you are "paying the interest", is that at the same rate as your old fix, or their likely 8-9% out of contract rate?

If you inform them you are selling and put thr house on the market they will likely agree to pause the repossession for 3-6 months, but you will need to sell thr property as they will recommence as soon as their deadline passes. 

pjread

I'd be inclined to just market the property, maybe looking for the high end of the valuation range - if you get a great offer it compensates for moving earlier than you ideally wanted, but in reality it could take a year if you're fishing for a high offer (and maybe you lower asking price in 9-12 months to what you really need/want for it if need be)

This way you can be open and honest with the lender that you're actively marketing the property

Only other thought is whether there's another vehicle to redeem the mortgage to de-stress the situation - did you not have something in place?  Perhaps pension lump sum(s) or emergency funds you can refill once you do sell.

silvercar

Provided you are paying the interest on the SVR, as opposed to the deal you had, the lenders hands are fairly limited. Although you are in breach, the lenders options are limited. There is an argument that they are accepting monthly payments so are acquiescing to the mortgage being extended. 

One option would be to apply to use the governments new initiative of extending mortgage terms by 6 months. If they refuse, then you put in a complaint that they have to deal with or you complain to the financial ombudsman. Both of which take time.

MWT

silvercar said:

Provided you are paying the interest on the SVR, as opposed to the deal you had, the lenders hands are fairly limited. Although you are in breach, the lenders options are limited. There is an argument that they are accepting monthly payments so are acquiescing to the mortgage being extended. 

One option would be to apply to use the governments new initiative of extending mortgage terms by 6 months. If they refuse, then you put in a complaint that they have to deal with or you complain to the financial ombudsman. Both of which take time.

I'm not sure that is reliable advice, the lender will have served notice of the breach of contract and accepting the interest payments doesn't weaken their position, it just reduces the costs that the borrower is accruing as a result of the breach.

Similarly the Mortgage Charter is only available to those who are up to date with their contractual payments, which the borrower in this case clearly isn't, having failed to repay the capital at the agreed time...

user1977

EndofMortgage said:

the building society are threatening repossession. 

What exactly do those "threats" amount to so far? What are you expecting to offer in any negotiation beyond what you've told us? A solicitor isn't going to have cunning legal arguments (assuming there is nothing fundamentally flawed in the security which the BS have).

I don't know how inclined lenders are to actually proceed with repossession in such cases - repossession is expensive and risky, and I suspect they'd prefer to sit back and collect the interest, while churning out letters warning you about their rights.

Keep_pedalling

Nearly two and a half years ago you you posted a similar thread wanting to stay in your 7 bedroom, £1.4M home for 2-3 year, and now that time is up you still want to stay another 2-3 years. 

https://forums.moneysavingexpert.com/discussion/6116827/short-term-loan-secured-of-home-is-it-possible#latest

Frankly this is madness you are pouring money into a house that is way bigger than than you need. Apart from the interest charges the running costs will be vastly more than a more suitable 2-3 bed house would be. Just bite the bullet and get this on the market ASAP. Get rid of the debt and the associated stress, then start enjoying your retirement with some of the equity you will be freeing up.

ACG

Have you spoken to a mortgage broker? 
There are things called RIO mortgages - Retirement Interest Only - assuming the income is there, it could be ideal. 
You also have equity release although that gets a bit messier. 

silvercar

MWT said:

silvercar said:

Provided you are paying the interest on the SVR, as opposed to the deal you had, the lenders hands are fairly limited. Although you are in breach, the lenders options are limited. There is an argument that they are accepting monthly payments so are acquiescing to the mortgage being extended. 

One option would be to apply to use the governments new initiative of extending mortgage terms by 6 months. If they refuse, then you put in a complaint that they have to deal with or you complain to the financial ombudsman. Both of which take time.

I'm not sure that is reliable advice, the lender will have served notice of the breach of contract and accepting the interest payments doesn't weaken their position, it just reduces the costs that the borrower is accruing as a result of the breach.

Similarly the Mortgage Charter is only available to those who are up to date with their contractual payments, which the borrower in this case clearly isn't, having failed to repay the capital at the agreed time...

I'm not a lawyer, but I would think that acceptance of payments does count for something.
It is all arguable, if it ever reached court, as there is also an obligation to TCF (treat customers fairly). Points along the line of: I'm still paying you interest, so you are not losing money; If you lend for 25(?) years, does lending for 26 really effect the lender, how much effort did the lender make to remind the customer of the need for full repayment? (My lender writes to me every couple of years and expects a response on my plans to repay the mortgage, does every lender?).
The lender also has to consider a courts view of allowing a repossession in these circumstances. Would a court grant some time to the borrower, given that the lender is receiving interest and so the loan isn't growing and the lender has some return on their money and presumably by the time it reached court the property would be on the market.