High Loan Charges/Mortgage Shortfalls Questions

[Nightmare4banks]

Hi All!

 

I would lke some input regarding High Loan Charges(HLC)/Mortgage Indemnity Guarantees regarding the practical aspect associated with these sort of policies mainly

 

1.once a possession order is granted in favour a lender can a lender automatically claim for the shortfall from the MIG policy or not once the property has sold at a shortfall?

 

2.Also,does the policy affect the amount owed by the borrower?(My guess here is no because the policy is for the lender's benefit and not the borrower?)

Clarification please.

 

3.Once a shortfall is established should the lender be persuing the borrower or the insurance company or both?

 

 

4.If there is clearly a HLC charge in the mortgage agreement but when enquiring about the MIG policy it is denied that any policy exists(which is clearly untrue as this is the whole idea behind charging the fee in the first place)what would one suggest the way forward? I was thinking about using CPR 18 under the County Court Procedures.

 

5.Does the denial of the non-existence of a MIG policy give the borrower the right to sue for misselling or under any other header i.e. damages?

 

 

5.Does a borrower have a right to inspect a MIG policy or not considering that it is not to benefit him/her?

 

 

Ideas/views would be highly appreciated.

 

Many thanks in advance.

[ananya]

Hi All!

 

I would lke some input regarding High Loan Charges(HLC)/Mortgage Indemnity Guarantees regarding the practical aspect associated with these sort of policies mainly

 

1.once a possession order is granted in favour a lender can a lender automatically claim for the shortfall from the MIG policy or not once the property has sold at a shortfall? I would imagine they can only claim if there is a shortfall, after the property has sold

 

2.Also,does the policy affect the amount owed by the borrower?(My guess here is no because the policy is for the lender's benefit and not the borrower?)

Clarification please. In what way do you mean? The borrower normally has the mortgage indemnity policy charge added to the fees on completion, well that's how it's worked for us

 

3.Once a shortfall is established should the lender be persuing the borrower or the insurance company or both? I would think that the mortgage company get reimbursed via the indemnity policy and then the insurance company chase the borrower for the shortfall

 

 

4.If there is clearly a HLC charge in the mortgage agreement but when enquiring about the MIG policy it is denied that any policy exists(which is clearly untrue as this is the whole idea behind charging the fee in the first place)what would one suggest the way forward? I was thinking about using CPR 18 under the County Court Procedures. Sorry, beyond me I'm afraid

 

5.Does the denial of the non-existence of a MIG policy give the borrower the right to sue for misselling or under any other header i.e. damages? Again, beyond me.

 

 

5.Does a borrower have a right to inspect a MIG policy or not considering that it is not to benefit him/her? I wouldn't have thought the borrower has any right to view any policy held for the benefit of the mortgage company.

 

 

Ideas/views would be highly appreciated.

 

Many thanks in advance.

 

Good luck

[Nightmare4banks]

ananya,

 

Many thanks for your post and wishing me good luck because I am going going to REALLY need it!

 

Answers to some of your questions:

 

1.Here I mean has the lender already claimed against the MIG policy or not as the sale has completed.However,I am being persued now.

 

2.Again I am talking abot the event when a property has been repossessed and not when the mortgage is being arranged.

 

3.I asked this question because the lender is chasing me and not the insurance company.I was charged a High Lending Charge when the mortgage was taken out but the mortgage company is denying that there is any MIG policy now! Mighty questionable!

Edited May 8, 2008 by Nightmare4banks