Posts Tagged ‘MORTGAGESHORTFALL’

My home has been sold and now I have received a letter chasing an outstanding balance. What are my options?

As the various lending institutions work through their ‘delinquent’ mortgage books, more and more people are approaching us at the end of the sale process, when the lender and their agents, usually solicitors, chase and seek recovery of the outstanding amount due, after the disposal of the asset(s) involved.

If a property was purchased pre property crash, then inevitably there will be a significant price variation after a sale based on today’s property values. Negative Equity is an extremely prevalent issue in today’s property climate in Northern Ireland and across the UK.

Invariably this balance will be a lot higher than you thought but will include the following additional information:

1.       All the interest since the last payment made.

2.       The property would have been sold ‘In Repossession’. Recent DSD figures show that these properties yield as little as 59% of the market value.

3.       Costs of the necessary action to recover the property through court.

4.       Any other associated costs

 

The balance left after the sale, I.e. ‘The shortfall’ is relative and the route which is taken is dependent upon two key factors

1.       Do you have significant surplus income? And/or

2.       Do you own other assets?

 

Inevitably, the balance is irrelevant. If a client cannot afford to pay a £70,000 shortfall, then they most certainly will not be able to afford a £100,000 shortfall.

Therefore, If the answer is no to both of the above questions then the options open to you firstly and the lender secondly are:

1.       A choice of formal insolvency, be it bankruptcy or IVA, subject to your individual circumstances.

2.       An informal insolvency option to settle with the lender on a full and final basis for a reduced amount.  

 

As ever we would implore you to be proactive as these things will not just go away.  By this stage the lender and their advisors usually want the matter resolved, one way or another, as does the client. 

Bell & Company have developed a specialised team who work with a wide variety of lenders and situations and resolve issues like these on a daily basis with excellent success.  If you find yourself with any of these issues, please get in touch with us here at Bell & Company. To discuss your case with us please call Karen on 02895 217373 to arrange your free initial consultation at a time and place to suit you. We look forward to assisting you.

Northern Ireland Housing Market Recovery? You’re Joking!

We hear a lot of optimistic individuals in Belfast claiming the  Northern Ireland housing market is “recovering”. Recovering is definitely not the term, improving maybe. Recent figures from Debt Action NI however suggest throughout Northern Ireland there has been a 24% increase since 2013 of borrowers falling into negative equity and mortgage shortfall debt.

Mortgage shortfall debt is now at £44 million across Northern Ireland.

Alarming statistics, particularly for those with their heads in the clouds suggesting recovery.

Further concerns have been raised as a poll conducted suggested 68% of home owners in Northern Ireland will be unable to meet their mortgage repayments when interest rates rise. I’m afraid it is not case of “if” interest rates will raise but “when” with The Bank of England marking the third quarter next year for a rate rise.

With 41% of homeowners in Negative Equity and Northern Ireland accounting for 56,034 out of 120,511 UK Properties with Mortgage Shortfall debt, according to Council of Mortgage Lenders figures, this is an Economic and Social time bomb which does seem to pass under the nose of Politicians all too often.

Many charities offer free advice and are encouraging individuals to take up this advice but they do not deal with Negative Equity and Mortgage Shortfall debt on a daily basis, this is our “Bread and Butter”. Our Resolution team achieve fantastic results and are happy to discuss any case over a free initial consultation with the decision on proceeding completely in your hands. Bell & Company have a fantastic rapport with all lenders and understand specific lender processes and protocol.

Bell & Company pride ourselves on the quality of the advice given. We give clients practical and realistic options tailored to your situation. The Resolution team invite you call the office and discuss your options over a cup of coffee. Call us today on 02890 517047 or email [email protected].

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Terry Bell – Director