Thanks. For me, I am looking at whether the management company has a legal right to claim the service charge in the first place, because most of the claim is for a sink fund against planned major works: but the lease makes no mention of collecting service charge in advance of expenditure. If I was right on this, the arrears would disappear. However, Mortgage Express could still stick to their guns, based on earlier breaches. I have sent a note to Joan about the group action and wait to hear more. But the law does not favour borrowers.

The legal position is that any payments due under a mortgage are due on the dates that the mortgage says they are due. For monthly mortgage payments, that will be a date agreed with the lender. Other dats won't be agreed directly with the lender: service charge is an example. The lender's rule will require you to pay your service charge whenever the service charge is due to be paid under the terms of your lease, be that on an annual date or some other, more frequent, date. If you do not pay all the service charge due, and pay it by the due date, you have failed to meet the terms of your loan. Whether the lender does anything about it at that time again is not the point. If they ignore, but later get upset with you, they can refer back to when you FIRST breached your terms and take action. So, again, if you ever had mortgage arrears of two months plus, even though (like me) you may have reached, and kept to, an arrangement with them and paid them all off, they can ALWAYS appoint receivers based on the first (and possibly the only) time you had arrears. Most lenders would not do this because, if they are now getting all their money and you are not accruing debts (by not paying service charge) they may well lose a lot of money. So they are more likely to work with you on any issues. But Mortgage Express, being bust, has a different set of considerations and only so long in which to reduce its loan book (that is, how much is lent out to customers). So, although Mortgage Express is going after weak loans looking for ways to terminate the loan, it is also going after really strong and safe loans. Because these are 'strong and safe', borrowers should be able to remortgage away and Mortgage Express want that because this also reduces the amount they have lent. You will see at once that the issue here for them is not profitability (keeping 'strong' loans would be profitable). The issue for them is how quickly they can get rid of loans one way or the other. A third way that they are encouraging is getting borrowers to reduce their debt by paying off capital. To encourage this they have removed early payment charges and when they review your portfolio they will probably apply the 75% loan to value rule. In a world where the value of properties has fallen, some landlords with excellent repayment histories will find that the value of their properties has fallen below this level, just because of market changes. Mortgage Express will use this to require payments of capital to reduce the loan. In my case, they are appointing receivers. The receiver (unlike the lender) can then sell at will, which is what they plan on. Hope this helps. Whatever your circumstances,Mortgage Express are looking for ways to get you off their books altogether, or at least to reduce your borrowings. In your last entry, you again refer to whether paying off arrears means they can't rely on previous missed payments. I trust I have explained that they can.

The questioner can be as incredulous as they like. The point here is that Mortgage Express is operating to an unusual set of standards because they have gone bust. They're not interested in being reasonable for the long term benefit. If they see trouble, they want such cash as they can get. Earlier this afternoon they repossessed my seven properties because of service charge arrears. I was paying the fund on refurbishments and had only one more to go. A going concern with a longer term view and future might have allowed me more space. Mortgage Express does not have a longer term future. You are looking for a set of understanding principles that simply don't apply in the circumstances facing Mortgage Express, and I might say that your responses to some of the well meaning, and accurate, replies borders on being impolite.

Mortgage Express are taking a hard line and this includes either enforcing, or explicitly reserving the right to enforce, either new conditions or old ones rarely enforced before. An example is that they might warn you that if things are not perfect in the future, the trigger point empowering them to take action may have been passed years before. So, let's say that you have no arrears now, but go one month into arrears. If that had been the first time, they might not be able to do anything. But if you had been, say, two months in arrears 10 years ago, the law empowered them to take action ever since that date. So what they are saying is, be good, or we'll exercise the powers already available to us because of what you did in the past. On your questions, failing to pay service charge is a breach of the 2010 conditions (if not your earlier version); trying to argue that you had grounds to not pay service charge may be a complicated effort. And, no, I bet your loan conditions do not allow you to stop paying on one to pay off arrears on another. The basic truth is that if you are not perfect, then Mortgage Express don't want you. They are a failed business trying to recover what they can, but within limits. Sometimes, it amkes sense for the lender to get what they can while they can rather than try to 'make it work' with you.

I have seven buy-to-let mortgages with Mortgage Express (ME) and reached a temporary agreement with them to deal with arrears. After a successful 12 months, they suggested capitalising the arrears. They then allocated a 'relationship manager' to visit me. I thought that, as with other other lenders who have sent counsellors in the past, this would prove positive for both sides. In the event, they said they have realised that I haven't been paying service charge on the flats and that they have had to meet this obligation, which is true. Instead of paying service charge, we have been refurbishing the flats. They have now written with certain demands, including that all the rental income be spent on the mortgages and the arrears so that the arrears are settled within 12 months. I am proposing to agree, provided that we first deduct from the income an amount to cover the service charge and that I pay this as I should to the management company. Hopefully, ME will agree. But what I would welcome advice on is their threat to repossess the properties unless I also agree to new terms. Needless to say, those terms would grant them extensive new freedoms to repossess in the future. ME are correct to say they are now merely enforcing their existing rights, because they need to reduce their loan book by selling off 'good' mortgages. This includes getting my own into good order ready for sale to another lender. But it sounds like duress to insist on new terms as part of a deal on current arrears that have been handled differently, and successfully, to date. One of the properties is subject to a suspended repossession order at a low repayment amount suggesting that, if this went to court, I may be able to maintain current rates of repayment on the others. After all, I've stuck to the 12 month agreement for the 12 months. Any thoughts would be welcome on whether I should contest the new terms even if I make the payments that they want. I do accept that these funds are owed to them.