SANTANDER "Term come to end"

keithtoon

Hi all,
After a monthly review I have been told I will receive a letter from Santanders solicitors to clear my mortgage deficit.
Here is my history.
Interest Only Mortgage expired 2 years ago Ans as requested house on market. Yes I want to downsize so looking to sell to be mortgage free. House was on market last may at £625,000 (valued by estate agent) after 4 months I reduced to £600,000this was with a online EA. In October Santander suggested I use a local EA which I have done. After a month the local EA suggested I drop price to £580,000 which the house is now on Rightmove at this suggested price.
Every month I had to ring Santander to give them a update as to the viewings and feedback.But yesterday after the monthly review I felt very sick and worried that they are now transferring the deficit to their solicitors.
My outstanding mortgage is £130,000 I have never been behind in my payments!
Does anyone know what will happen next or is there anything more I can do?
Thank you Kg

Hoenir

After two years not surprising Santander's patience is wearing thin. Why not price the property at an attractive level. Thereby generating plenty of interest which should drive the actual selling price higher. As you are in breach of your mortgage contract. Next step would be forced repossession. Incurring you with costs. 

RelievedSheff

You need to look at it from their side as well. They have given you two years over your initial agreed term to sort out paying off your mortgage. They quite rightly want their money back.

Continue marketing the property and have a thorough and honest review with your estate agent of the marketing price. For it not to have sold in two years it is over priced. 

Not much you can do about Santanders internal processes. You will receive letters from them keeping you updated as to case progress. Don't ignore them. Make sure you read them and understand the content.  

Mark_d

It is surprising that Santander allowed you to reach the end of your mortgage term without being on track to repay the capital.  Towards the end of my parents mortgage, the lender switched them to part-repayment to ensure the capital would be paid off at the end of the term.

So your mortgage term has come to and end and you are in debt by £130k?  Can you possibly remortgage?  If you allow the property to be reposessed you might end up with nothing, so the safest thing would be to work with the estate agents to get a sale quickly.  They might advise you to drop to £500k.  It's a significant drop but getting the quick sale could be what saves you from a real life nightmare

Hoenir

Mark_d said:

It is surprising that Santander allowed you to reach the end of your mortgage term without being on track to repay the capital.  

Nothing unusual in this. A legacy from the past. Santander can only ask how not force the issue. Ultimately responsibility lies with the borrower. 

keithtoon

Update: I have reduced to £568,000 today and updated Santander. They will still sent out the letter. They did mention I could extend my mortgage, ie re mortgage till I am 70 which is 2 years away. Hopefully the new price might attract a buyer, fingers crossed.
TIA...Kg

Hoenir

Seems Santander are covering their own backsides. Presumably you don't meet the criteria for a remortgage. 

keithtoon

Hoenir said:

Seems Santander are covering their own backsides. Presumably you don't meet the criteria for a remortgage. 

They have suggested I apply to remortgage, I think they call it "Extend your Deal?
Every monthly review was welcomed with a " as long as your house is on the market", which they can see on Rightmove. Everytime I rang them you speak to a different person but this months review was a bit of a shock!!!
Never mind see what comes along as I have reduced the price. 
TIA Kg 

MWT

keithtoon said:

Every monthly review was welcomed with a " as long as your house is on the market", which they can see on Rightmove. Everytime I rang them you speak to a different person but this months review was a bit of a shock!!!

No lender is going to rush into repossession, but after two years it is reasonable for them to increase the pressure as it strongly suggests that the property is overpriced.

Good that you have reduced the price, but is this after a serious discussion with your EA about where the price should be to get a sale in the current market?

Your other option is to use something like equity release to clear the mortgage and then take time to sell on your own terms as and when you want.

I wouldn't usually suggest doing this when you want to downsize as early redemption charges can be high, or the interest rates on products with no ERC can be higher, but there are also some products with 'downsizing protection' that would let you transfer the product to the new property if it is acceptable to them.

All still very much a final choice option though, generally be better to price the property at a level that will help you get a quick sale at this point...

keithtoon said:

My outstanding mortgage is £130,000 I have never been behind in my payments!

Never behind on payments, but clearly in breach of the obligation to repay the mortgage 2 years ago, so this isn't a valid point really and certainly not a point in your favour if the lender decides you are not really serious about getting the property sold...

Hoenir

keithtoon said:

Hoenir said:

Seems Santander are covering their own backsides. Presumably you don't meet the criteria for a remortgage. 

They have suggested I apply to remortgage, I think they call it "Extend your Deal?
Every monthly review was welcomed with a " as long as your house is on the market", which they can see on Rightmove. Everytime I rang them you speak to a different person but this months review was a bit of a shock!!!
Never mind see what comes along as I have reduced the price. 
TIA Kg 

Probably catching up now with the backlog caused by the pandemic era. Administering deliquent accounts is administratively time consuming. Now you are firmly on the radar so to speak. 

silvercar

Out of interest, what interest rate are they charging you? Their SVR or are they adding a penalty rate?