Voluntary reposession of a home - anyone got any experience ?

curiouscat91

Hi All,

Bought our home 2 years ago and never missed a mortgage payment although our finances are really bad at the moment. We have got no savings whatsoever. The tip of the iceberg is that my wife’s mom been diagnosed with a terminal illness and she lives abroad, it seems like my wife is adamant to go and take care of her, probably I will have to join her too not too meaning we will have to quit our jobs as sure how long this is going to take… not sure what to do about our home… it’s not in negative equity so we were thinking of handling keys back to the lender and ask them to sell it. How quick this can be? I know there might be a mortgage shortfall to pay but i am not sure if we will be able to afford it even if we find jobs abroad. Can lenders come after you abroad? I know we can sell it but we don’t have the time and fees to initiate a sale. We are desperate and we don’t know what to do.

has anyone been in the same situation can you please share your experiences?

any help would be much appreciated.

user1977

How little equity is there, if it's not in negative equity but you suspect you may end up with a shortfall? Voluntary repossession is still going to end up with costs which you wouldn't have with your own sale.

theartfullodger

You'll almost certainly end up with debt of mortgage shortfall PLUS their admin costs.  And a bad mark which will show up in any credit check, loan application, mobile 'phone contract.

Sorry.  Good luck, hope it works out .

Ps don't think renting it out will necessarily make any money...

Hoenir

Sell the property yourselves. Save a lot of unneccesary fees. 

knightstyle

The trouble is that the lender will sell at auction for a very low price and then come after you for the shortfall.
much better to sell it yourself for a realistic price, we have just sold, move in 2 days and we put it on the market on 31st June.

ACG

That would go down as a reposession on your credit report. 
Handing the keys back would mean you miss however many payments until it defaults, it then goes to court as they have to get possession of the property and then they sell it. 

All of that will add up. 

Or you could just put it up for sale yourself and take a silly offer as that would look better on your credit report, avoid a repossession and avoid all of the charges and rolled up interest, any equity will probably be gone by the sounds of it and then you will be in debt.

Or an alternative could be to rent the property out (with consesnt to let from the lender). 

Voyager2002

You can sell at auction (which is what the lender would do). Nothing to pay until the actual sale.

Hoenir

knightstyle said:

The trouble is that the lender will sell at auction for a very low price and then come after you for the shortfall.

Common misconception but not the case. 

gwynlas

Do not rush into a bad situation. If you are not leaving the country immediately then you can get three estate agents around within days  to vialue the property, Depending where you are it will have probably risen in price and you would have your deposit returned? Explain your situation to chosen EA and give them a set of keys for viewings.

Presumably you have someone who you trust who could visit to check on post etc.If the sale is prolonged into the winter then you need to think about risk of frost damage/burst pipes. You can deal with paperwork from anywhere.
You should make your lender aware of the situation so that you do not fall to far behind in payments.

It might be that your mother in law does not suffer for long so you would need to decide if you wish to remain in this country or relocate abroad.