Mortgage Shortfall??????????

[CMJAG42]

Hi there, i'm looking for some information with how the building societies collect any mortgage shortfall after repossesion?

Hypothetically:

My sister is in a threeway mortgage with her parents on a property that is not in negatve equity! (bliss for some!!!!!) She has moved on but due to circumstance she has become unable to pay her share of the mortgage and her parents cannot cope with the full ammount (this is also an 'Intrest Only' mortgage).

Obviously she is feeling responsible that the position seems unatainable but one option is that they let the building society have the property back.

Knowing that the properties generally go to auction, so the mortgage company can realise its equity quicker, means generally lesser figures realised for the property, causing a shortfall

One option would be to sell the property but as time runs on they cannot afford to pay for somewhere whilst it's on the market. Plus the mortgage company are keen, very keen!!!!!!

So here's the question:

Knowing this and going down the reposession route, she realises that she is responsible for her third, how do most mortgage companies go about claiming any shortfall? Is it through the courts? Debt collection agencies?

And are they generally ameanable to any offers?

Thanks for any advice or info in advance:)

Regrds

Chris:)

[MilkTrayMan]

Hello CMJAG42!

 

Lots of questions.

...Would need more info from U to cover ALL the extra advice that U may need...i.e. If anyone was to become homeless etc etc

 

Simplistically put, once a Repossession has taken place, the Mortgage Provider has 12yrs to chase any shortfall legally.

...However, there is a voluntary code of conduct by the Council of Mortgage Lenders that they cease chasing after only 6yrs, if contact has NOT been established with the former Mortgage Holder.

 

Here is a link to MY Thread, which hopefully should spur U on to act positively, quickly + with purpose...

http://www.consumeractiongroup.co.uk/forum/halifax-bank-bank-scotland/49329-bitter-soft-centres-anyone.html

 

NEVER EVER just hand the keys/property back to the Mortgage Provider!!!

Shelter: Going to court

http://www.adviceguide.org.uk/d_mortgage_arrears.pdf

National Debtline England & Wales | Debt Advice | Factsheet 11 Mortgage Shortfalls

 

 

If there is POSITIVE equity + it is unlikely that the Mortgage repayments can be met, get the property on the market pronto.

It is MUCH better to try to sell the property yourselves, than leave it to the Mortgage Provider to sell it.

If the price U sell at is competitive + low enough, it WILL sell...

 

 

...

[patdavies]

Knowing that the properties generally go to auction, so the mortgage company can realise its equity quicker, means generally lesser figures realised for the property, causing a shortfall

 

The mortgage holder is legally obliged to get the best price for the property - this is why auction is used; there can be no accusations of marketoing the property at too low a price as in auctionm iit will achieve the best price on the day.

 

Knowing this and going down the reposession route, she realises that she is responsible for her third, how do most mortgage companies go about claiming any shortfall? Is it through the courts? Debt collection agencies?

Depending on how the mortgage is worded, she may not just be liable for one third - each may be liable for the whole lot if chased by the mortgage holder. They coukld come after the person that they judge best able to pay for the whole lot.