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Does anyone know about this voluntay agreement


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“Lenders who are members of the Council of Mortgage Lenders voluntarily agreed from 11 February 2000 to begin all recovery action for a shortfall within six years of the sale of a repossessed property. If your property was taken into possession and sold more than six years ago, and you have not been contacted by your lender to recover any outstanding debt, you will not now be asked to pay the shortfall. In Scotland, lenders will begin recovery action within five years”

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After your lender takes your property into possession they have a legal duty to sell the property for the best price that can reasonably be obtained. The property will generally go on the market as soon as possible and your lender will get independent, expert advice on the price it should be sold for and the best method of sale. If the sale of the property results in a surplus after all the money owed to the lender and any other secured lender has been repaid, then this surplus is returned you. Your lender should notify you of the surplus but if you cannot be contacted, the money will either be held by the court or your lender until you can be contacted. But if the sale proceeds are not enough to pay off the money you owe to the lender, then there is a "shortfall debt" which you still owe your lender after possession. Interest will usually continue to be charged on your mortgage loan until the property is sold and any shortfall is repaid. There will also be other costs charged to your mortgage account, including estate agents' costs in selling the property and legal costs.

 

In England, Wales and Northern Ireland, a lender legally has 12 years to contact you to begin the process of seeking repayment of a shortfall debt; this period is usually 5 years in Scotland. However, lenders are committed to fair and sympathetic treatment of people who have suffered repossession, and accept that individuals should not face long delays before being contacted to discuss repaying the shortfall. Most lenders will contact you fairly soon after possession to try to agree to a manageable arrangement for repaying all or some of the debt.

 

Lenders who are members of the Council of Mortgage Lenders voluntarily agreed from 11 February 2000 to begin all recovery action for a shortfall within six years of the sale of a repossessed property. If your property was taken into possession and sold more than six years ago, and you have not been contacted by your lender to recover any outstanding debt, you will not now be asked to pay the shortfall. In Scotland, lenders will begin recovery action within five years. The six year limit only refers to beginning recovery action and does not affect a lender's ability to recover the shortfall debt over a longer period. If there is evidence of mortgage fraud, the time limit will not apply.

 

Have a read here:

 

http://docs.google.com/viewer?a=v&q=cache:IV_4glfMQD4J:www.parliament.uk/briefing-papers/SN04837.pdf+%E2%80%9CLenders+who+are+members+of+the+Council+of+Mortgage+Lenders+voluntarily+agreed+from+11+February+2000+to+begin+all+recovery+action+for+a+shortfall+within+six+years+of+the+sale+of+a+repossessed+property.&hl=en&gl=uk&pid=bl&srcid=ADGEESgrV5TFMblAR_CGSMIL5FIjiA3VzfnybPGyCoyHjnD2dXvc0B3RypIuyQslqoOQ1SNCCxEG06Vq0iQnO4RRefb6sO2NRm4JL00kLkl_jfxa-LWfYZ4heuha4NTzv9CRtUoFn4sw&sig=AHIEtbSMX1rB1AA1aHRx0Y9N1wTBv3bw3A

 

What is your situation?

Edited by ukaviator

WARNING TO ALL

Please be aware of acting on advice given by PM .Anyone can make mistakes and if advice is given on the main forum people can see it to correct it ,if given privately then no one can see it to correct it. Please also be aware of giving your personal details to strangers

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Thank you for that ukaviator. My situation is that following an industrial accident in 1992 our house was re-possesed by the Britannia Building Society in 1995. I divorced my wife in 1996 and moved to Australia in 2004. Out of the blue in 2008 i received a letter from solicitors of Britannia, i can only assume my ex gave them my address here in Australia. I did a bit of research and emailed back the parragraph i posted as the building society are a member of this council. and i heard nothing since.

 

In my case it is more than 12 years since i was contacted by anyone but i think it is around 8 years after the sale that they contacted my ex and she responded to the debt. From what i understand if either party on the mortgage replies the clock stops.

 

I just dont want this over my head or my new wife on our return to the UK next year

 

Thanks in advance

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