Your browser isn't supported
It looks like you're using an old web browser. To get the most out of the site and to ensure guides display correctly, we suggest upgrading your browser now. Download the latest:

Welcome to the MSE Forums

We're home to a fantastic community of MoneySavers but anyone can post. Please exercise caution & report spam, illegal, offensive or libellous posts/messages: click "report" or email forumteam@.

Search
  • FIRST POST
    • Cafm1992
    • By Cafm1992 9th May 18, 7:54 PM
    • 12Posts
    • 3Thanks
    Cafm1992
    In-laws trying to reclaim 20k surplus from repossessed house sale.
    • #1
    • 9th May 18, 7:54 PM
    In-laws trying to reclaim 20k surplus from repossessed house sale. 9th May 18 at 7:54 PM
    Hello all and thank you in advance for any advice.

    I hope that this is an appropriate forum to post this in and apologies if it is not.

    I realise that many of you, once you have read below, will shake your heads at how my in-laws have handled their situation. I know I do but I would like to help them get back what is rightfully theirs.

    I believe (optimistically) that my MIL and her husband are due a surplus of circa 20,000 from the sale of their repossessed house in 2004.

    • The house was bought for 108,000 in 2001
    • Re-mortgaged for 135,000 in 2002,
    • Secured loan from SPML for 20,000 in 2002
    • Secured loan from IGroup for 10,000 in 2002
    • Secured loan from IGroup for 5,000 in 2002
    • Total secured debt of 170,000 in 2002
    • House repossessed in 2003
    • Sold for 190,000 in 2004

    Given that the sale price was 20,000 more than the original debt, discounting any interest accrued during the time, I believe that there may be a chance of a surplus being due and that all secured debts are now cleared.

    Due to a series of family and financial issues, my MIL and her husband never checked on this or updated any of their creditors with their contact details. The time scale without any contact or payment is now well over 6 years, so past the statute of limitations for legally enforcing debt.

    My questions are, is the bank:

    1. The seller of the house?
    2. Responsible for distributing the surplus to the creditors?
    3. Holding any surplus money? (Should there be any)
    4. Able to tell me about any surplus money, if I write to them requesting the information?

    Also, should there be any debt outstanding; will contacting the bank result in resetting the statute of limitation on debt?

    Thank you,
Page 1
    • elsien
    • By elsien 9th May 18, 7:59 PM
    • 16,889 Posts
    • 42,635 Thanks
    elsien
    • #2
    • 9th May 18, 7:59 PM
    • #2
    • 9th May 18, 7:59 PM
    What about any court or selling fees? Have those been taken into account, plus any interest charges?
    All shall be well, and all shall be well, and all manner of things shall be well.

    Pedant alert - it's could have, not could of.
    • John-K
    • By John-K 9th May 18, 8:04 PM
    • 654 Posts
    • 1,017 Thanks
    John-K
    • #3
    • 9th May 18, 8:04 PM
    • #3
    • 9th May 18, 8:04 PM
    As above, auction fees, interest, penalties, administrations costs, they all add up, and reduce the potential surplus.

    No harm in checking, but I!!!8217;d be surprised if the bank just decided to keep it and keep quiet about it.
    • Cafm1992
    • By Cafm1992 9th May 18, 8:07 PM
    • 12 Posts
    • 3 Thanks
    Cafm1992
    • #4
    • 9th May 18, 8:07 PM
    • #4
    • 9th May 18, 8:07 PM
    Thank you for your reply, I had not thought to consider court fees or selling fee that the bank must have incurred.

    Interest had crossed my mind, however due to several house moves since 2003 my in-laws have not been able to find any paper work which could help us determine and interest charges.

    I also forgot to mention that it was not until this year that my father in-law thought to check the sold price on rightmove, which is when the idea about reclaiming the surplus came to him.
    • Farmerbob
    • By Farmerbob 9th May 18, 8:10 PM
    • 205 Posts
    • 124 Thanks
    Farmerbob
    • #5
    • 9th May 18, 8:10 PM
    • #5
    • 9th May 18, 8:10 PM
    I think you are being quite optimistic there. Who carried out the repossession was it the mortgage company or one of the second charges they took out? If it was the bank then they would be able to confirm if they sent any funds left over to the second charges which may give you a better idea what it anything was left over?
    • Cafm1992
    • By Cafm1992 9th May 18, 8:25 PM
    • 12 Posts
    • 3 Thanks
    Cafm1992
    • #6
    • 9th May 18, 8:25 PM
    • #6
    • 9th May 18, 8:25 PM
    Thank you all for your replies,

    Farmer bob, I now realise there is more to this, it had not even occured to me to one of the second charges may have carried out the repossession, I assumed that the creditor with the largest stake would have been the one to carry out the repossession.

    Just off to phone to my MIL and she thinks that it was one of the second charges.

    I will write to the bank in the hope it was carried out by them to see what information they hold.
    • PrettyKittyKat
    • By PrettyKittyKat 9th May 18, 8:53 PM
    • 536 Posts
    • 492 Thanks
    PrettyKittyKat
    • #7
    • 9th May 18, 8:53 PM
    • #7
    • 9th May 18, 8:53 PM
    If your inlaws didn't update their address if with the companies then it is possible they were sent letters, and the debts may not be statue barred. However, given how old they are it could be possible they haven't tried to make contact even at the old addresses in over 6 years.

    I feel your calculations may be far too optimistic. You have quoted the amount of money lent from the creditors, there most certainly would have been interest on this balance, plus charges for missed payments. Given that the property was repossessed within 1 year I am guessing it is likely that they made very little payments following the remortgage and getting the secured loans. Then as others have started there will be alot of fees and charges involved in the repossession.

    Personally I think you are best leaving well alone. Why open a potential can of worms from so long ago?
    • PrettyKittyKat
    • By PrettyKittyKat 9th May 18, 8:55 PM
    • 536 Posts
    • 492 Thanks
    PrettyKittyKat
    • #8
    • 9th May 18, 8:55 PM
    • #8
    • 9th May 18, 8:55 PM
    Also, as it has been 14 years since the sale I am wondering if the banks will hold any information? Especially as you say you have no documentation in regards to the loans? I know all companies have to have a data retention policy, the companies I worked in would destroy data 6 years after it was last used although I believe banks do have longer periods. I'm no expert on this aspect it was just something that popped into my head.
    • davidmcn
    • By davidmcn 9th May 18, 8:59 PM
    • 8,191 Posts
    • 8,542 Thanks
    davidmcn
    • #9
    • 9th May 18, 8:59 PM
    • #9
    • 9th May 18, 8:59 PM
    4. Able to tell me about any surplus money, if I write to them requesting the information?
    Originally posted by Cafm1992
    No, in the same way that your bank isn't likely to have a chat with your in-laws about your financial affairs. You can of course assist the in-laws with contacting their previous lenders to see what information they might still have.

    But I presume your in-laws would have been in considerable arrears by the time of repossession, with possibly several of their accounts? So add the arrears, the accrued interest, penalty charges, legal costs, marketing costs...
    • Cafm1992
    • By Cafm1992 9th May 18, 9:40 PM
    • 12 Posts
    • 3 Thanks
    Cafm1992
    Thank you PrettyKittyKat for your reply, you have pretty muched hit the nail on the head on how I feel regarding potentially opening up a can of worms from a time that at least my MIL wants to just forget.

    I have just looked at the historic Bank of England interest rates and between 2001 and 2003 the interest rate was 4%, so even if the loans were at the Bank of England rate, then interest would be just shy of 7k per year, assuming they made only a few payments. Further highlighting how optimistic I was being.

    Regarding everyones advice about costs to consider, I think I may advise my in-laws to just let sleeping dogs lie on this one.

    Thank you all.
    Last edited by Cafm1992; 09-05-2018 at 9:43 PM.
    • caprikid1
    • By caprikid1 10th May 18, 11:27 AM
    • 639 Posts
    • 629 Thanks
    caprikid1
    I think this is almost certainly wiped out in costs. If you think of nothing paid for 2 years on 170K of debt @6% that equates to 20,400. I appreciate it probably was not 2 years but I bet it is a least a year, each account in arrears will add charges. Selling charges , court charges. I bet it did not cover the costs.
Welcome to our new Forum!

Our aim is to save you money quickly and easily. We hope you like it!

Forum Team Contact us

Live Stats

89Posts Today

2,093Users online

Martin's Twitter
  • Ta ta... for now. This August, as I try and do every few yrs, I'm lucky enough to be taking a sabbatical. No work,? https://t.co/Xx4R3eLhFG

  • RT @lethalbrignull: @MartinSLewis I've been sitting here for a good while trying to decide my answer to this, feeling grateful for living i?

  • Early days but currently it's exactly 50 50 in liberality v democracy, with younger people more liberal, older more? https://t.co/YwJr4izuIj

  • Follow Martin