House Repossessed + £96k debt - Update

silvercar

redimp98 wrote: »

House repossessed for £50k is used to pay off the mortgage balance of £50. Amount owed = zero.

This would be true if there were no arrears and no repossession costs, legal costs, estate agent fees etc.

Unfortunately all these costs add up. Even when the repossessed home is sold this amount outstanding then has interest running until a settlement is reached.

If you presume that 6 court cases resulted in £4k legal costs, arrears mouting at £700 a month for a year = £8.5k, then repossession costs which are around £2k plus legal costs another 2k, estate agaent fees another £2k plus other odds and sods you are at nearly £20k. Now apply interest at SVR + 2% for every year from 1994 to now cumulatively. Easy to see how costs mount.

But you do hear of people showing the lender they have limited funds and reaching a settlement figure of a low percentage, either because the lender has all but written off the debt or because the debt has been bought by debt collectors for pennies.

Not withstanding that Homer's findings look worth investigating.

SingleSue

We were repossessed in 1994 and although the house sold for £10K less than purchased, we ended up with a bill for £29K....in 2005!

We eventually settled for 10% on the outstanding amount but only after extreme pressure to completely wreck out just rebuilt credit record from the people trying to collect the debt (5+ calls a day, 2 letters a day, telling us to go to loan sharks etc to get loans, you name it, they did it). They accepted our offered amount (we offered that amount on the advice of CAB, even though we had to borrow the money from my parents) after I said we would go bankrupt as we had no way of paying what they were asking.

Stupid thing is that in 1994 on the advice of the building society, we had offered the collections people for the insurance company (we had purchased an indemnity policy) a monthly amount towards our debt...which they refused and then didn't chase up until 2005, had they accepted that payment proposal then, they would have actually got more out of us.

mightymouse

Hi

In my experience the sooner those people who have been repossessed know their rights the sooner they will be able to deal (or hide) from the problems of lenders persuing shortfall.

Since the early 90's Lenders have obtained settlements against individuals without having to disclose whether the settlement information is legally correct or not.

The laws may be nothing new but they are goldust to people who do not know.

I for one might be able to help others better if I knew why all the pre 2000 repossessions were unenforceable.

I do agree that most lenders will accept a fraction of what they are owed but I would have no problem referring the matter to a company if there was any mileage in it for the borrower.

homer_j_3

It is important to realise that there are solutions out of there and whilst I may seem like I am on a crusade on here, I believe that this being a consumer site and not a lender website, people should be aware that there is recourse for many many people. Infact it is estimated that there may be anywhere upto 20 million claims out there.

Unfortunately, as I have said, the bit where this site may disagree with what I say is that there is no chance that I or you will be told the ins and outs properly of what the legal arguments that take place. Clearly the company that are at the forefront of this have a commercial interest and want to protect it. It has taken 6 years to get to here and an awful lot of money employing the best legal advice to check that their arguments are correct.

I know a couple of the well documented arguments and have posted about them on here but there are more from what I am told. The service is free for people (apart from a £10 cheque to their lender to get the DPA stuff). The legal costs are insured or recovered. The claim is not reduced in anyway and the settlement looks to completely rectify the clients credit status.

To me, this service is something Martin should be promoting due to the fact that it can and will help a lot of people.

ekimnas

I lost my job 2months after taking the mortgage out.

ekimnas

Purely for info - The £96k was the debt enforced by the court order and does not include interest since the date of the court order.

ekimnas

contract was signed in the solicitors office in front of him. In hindsight Ishould have sat there for two hours and read the whole thing (that is how long it would have taken). Should the solicitor have pointed this out to us? (just a question because I don't know) However are you telling me that everybody reads there mortgage agreement from fron to back before signing it. I don't think so.

ekimnas

If i remember rightly, I believe the figure was @ £69k including arrears, fines, court costs etc...

ekimnas

I have amended the post accordingly because the house would clearly not have been £85k.Put that down to my age and failing memory !

homer_j_3

ekimnas

You may have options available to you through the above link or through other companies that specifically look and specialise at this. You are never going to win a legal argument without the right information and arguments.