Repossession - Employing a Solicitor to Negotiate With Building Society

MWT

silvercar said:

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.

If you check the earlier thread linked above you will see that the lender has already waited 3 years past the due date on a 12 year mortgage, I don't think they are likely to have any problems proving they have been reasonable.

The OP has been fully aware of their obligations and just doesn't want to accept that they really do have to repay the £400k they borrowed using their offset reserve account and if they still have no other plan then proceeding with a repossession is beginning to look like the banks only alternative...

 

MWT

ACG said:

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. 

Based on the earlier thread the income is not there to support a RIO, but I'd seriously suggest considering an ER product as the only practical short term solution.

Not sure if they are still around, but there were some products that offered no ERC, but at a premium interest rate, if still available that might be the best bet if they are serious about down-sizing any time soon (which is looking less and less likely as they are already 3 years past the point when they just wanted 'another 2-3 years' ...), but they need to be honest with themselves about downsizing and perhaps just take a normal ER product if the reality is they just want to stay their regardless...

Admiral_Barbarossa

EndofMortgage said:

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?

The Building Society requires you to pay off your mortgage at the end of term, this finished in 2020, when you were looking to stay for two to three years, before downsizing. You have not downsized. They want they money back.

Not the answer you're looking for, but it is you that is now required to downsize.

MWT

EndofMortgage said:

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?

Sorry, I didn't actually answer the question as asked...

The charity Shelter may be able to put you in touch with legal advisors who specialise in repossessions.

The best advice though is don't waste your time or money, as there is nothing to negotiate at this point, just decide once and for all if you really do intend to downsize, and if so, get on with it...

The only way to avoid the very reasonable pressure from the lender and their mounting costs which you are liable for is to pay what you owe and equity release looks like your only practical option (assuming your wife is over 55) other than selling as quickly as possible... 

silvercar

MWT said:

silvercar said:

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.

If you check the earlier thread linked above you will see that the lender has already waited 3 years past the due date on a 12 year mortgage, I don't think they are likely to have any problems proving they have been reasonable.

The OP has been fully aware of their obligations and just doesn't want to accept that they really do have to repay the £400k they borrowed using their offset reserve account and if they still have no other plan then proceeding with a repossession is beginning to look like the banks only alternative...

 

Ok. I thought we were talking of a shorter time period. Having money in the offset reserve with the lender, tells the lender that you can absolutely afford to clear the mortgage, which does weaken any bargaining power IMO.

If OP wants to resist then the lender would still need to go through the proper proceedings, which would mean going to court, though eventually the OP would be liable for the costs of this.

MWT

silvercar said:

Ok. I thought we were talking of a shorter time period. Having money in the offset reserve with the lender, tells the lender that you can absolutely afford to clear the mortgage, which does weaken any bargaining power IMO

It is not quite like that, we had the same mortgage from the same original lender, and what the OP has done is use the reserve facility, which as you pay down the mortgage over time, allows you to borrow back some of the gap between your original mortgage amount and the remaining amount still to be repaid.

This is a great facility because it gives you a line of credit at mortgage rates which is instantly accessible.

The hard and fast rule is that by the time your mortgage is fully paid off you must also have fully paid back anything you borrowed from your reserve.

As you approach the end of the mortgage term you get multiple reminders that the reserve has to be repaid, only by wilfully ignoring the warnings could you end up at the end of the mortgage with the reserve still outstanding.

... yet that is exactly what the OP has done, the mortgage is full paid off, they just borrowed back £400k from the reserve account with no viable plan to pay it back and then have done nothing about it for the last 3 years and now are trying to negotiate with the lender...

The original complaint was that they wanted an additional 2-3 years, but the bank wouldn't agree, well now through the passage of time they have had the 3 years they originally wanted and yet they still want yet more time...

Hard to see why the bank wouldn't just proceed with the repossession at this point as they cannot rely on the OP ever actually leaving of their own free will...

Flugelhorn

we had an offset like this and for years we got letters making it very clear what had to be paid off and when. At the end it was fully offset but the solicitor couldn't get a redemption statement until the morning of completion just in case we borrowed the whole lot again 

user1977

MWT said:

silvercar said:

Ok. I thought we were talking of a shorter time period. Having money in the offset reserve with the lender, tells the lender that you can absolutely afford to clear the mortgage, which does weaken any bargaining power IMO

Hard to see why the bank wouldn't just proceed with the repossession at this point as they cannot rely on the OP ever actually leaving of their own free will...

Seems very little risk to the lender though if the loan is only a third of the value of the property. They'll get it eventually, unless something weirdly disastrous happens.

For the sake of an easy life, I'd just be sitting back and collecting the interest.

MWT

user1977 said:

For the sake of an easy life, I'd just be sitting back and collecting the interest.

These days I would take the risk of the customer filing a complaint about being allowed to continue to incur interest and run up legal expenses when they should have been repossessed years earlier when the property prices were higher...

EndofMortgage

Thanks everyone for your replies and opinions, it has been very useful reading them. Since making the post I contacted Citizen’s Advice who pointed me in the direction of The Law Society and using their website I have made contact with a local firm of solicitors who hopefully can help me.

To help clarify here are some facts that perhaps I should have mentioned before

The original term ended at the same time as COVID and for that and some other family matters it was not the right time for downsizing. In the next two and half years there was minimal contact from the lender and certainly no urgency shown by them so I choose to ignore the situation. I realise  that may not have been the best strategy but it has given me 3 years extension so far so it hasn’t been a complete failure. In the last few months however, the lender has become more engaged and has mentioned the repossession possibility. My family love our current house but know we do have to downsize so I suppose what I have done is extend the mortgage term without the permission of the lender. The reason I now want to have a solicitor is that the final phase of this exercise is now putting the property on the market and buying another one and I want to do this without the pressure of imminent repossession proceedings. I don’t expect the solicitor to do miracles but I am hoping they can help us stall the process long enough so the sale of the property and the purchase of a new one can be done without the deadline of a repossession. I don’t want to do this myself as I need info on the process and the likely reaction of the court. I must admit I was surprised that the lender suddenly became keen to collect as the interest payments have increased significantly and I’ve never missed a payment. I believed with the cost of living crisis and government pressure on mortgage lenders to be more understanding with customers I could maybe squeeze another year before being forced to move. When I say I wanted the solicitor to negotiate with the lender I suppose what I really meant was that I wanted the solicitor to help me with legal background info so I was in a better position to negotiate.