Repossession at end of mortgage term.

[Sellessal]

My husband and I currently have an interest-only mortgage with Future Mortgages which ends in September 2013. Both of us had good jobs but 2007 I had a bad fall at work and eventually lost my job as I was unable to sit at a computer all day. I am still on Incapacity Benefit and Industrial Accident benefit. In 2008 my husband was made redundant as was told by the Jobcentre that he was wasting his time looking for employment. As my husband had a small private pension he took this early to try to continue paying our bills. As a result of this we were told we did not qualify for any benefits as we had £10 a month too much coming in.

Our endowment insurance turned out not to be worth the paper it was written on and due to our lack of finances we were unable to pay it. Our mortgage is now due to be settled with an outstanding amount of £250,000. We believed that we would be able to sell the house and repay the debt with no problem as it was valued at £300,000 two years ago. It is now worth less than the mortgage. We have considered handing the keys back to the mortgage company but do not know what the consequences would be, We could try to sell the house at below its value and still owe the outstanding balance. As we will both be on state pension next year I don't know how we will ever be able to repay this. Any advice would be most welcome.

[tuttle]

Very sad to lose your home at this late hour, what type of property is it? I have a number of ideas for you, will try and offer some help. Do not hand the keys back.

[Sellessal]

Its a four bedroomed detached house. Once our family home but now only the two of us. Any suggestions would be appreciated.

[tuttle]

you should rent it out, in my area it would gain £1400pm - cheapest place to live is on a mobile caravan site, nice holiday for a year or 2, savings could then have you abroad for the winter, when i'm in my twilight i'm going to think like the birds

[Sellessal]

Thanks Tuttle for the advice but I was really looking for something a bit more constructive, lik the legal implications and what would happen after repossession.

[tuttle]

Thanks Tuttle for the advice but I was really looking for something a bit more constructive, lik the legal implications and what would happen after repossession.

It does take some time before a repossession happens, I would seriously look at your income and what you would gain for selling everything, will your children help and contribute towards the mortgage? afterwards they would just pursue the debt, but you could go bankrupt and pay a % in the pound, after 2yrs it would be discharged. So you have a few options, moving to a smaller place might make life easier. Hope this helps.

[42man]

Have you tried claiming back for a missold endowment policy ?

[Lea_HTH]

Have you tried speaking to the local authority about the possibility of using the mortgage rescue scheme? There are certain criteria to be met, but you may qualify.

 

Handing back the keys is not something you should consider lightly. You will remain responsible for the property and its upkeep, insurance and council tax, until it is sold - so effectively, your outgoings won't change much in relation to the house (the monthly payments will continue to accrue as arrears and will need to be repaid eventually from the sale of the house, or in a shortfall if the house sells for less than the mortgagee is owed). An owner occupied house will sell for more than a repossessed property that is empty, so if you can sell it whilst you are still in it, even if you have to take a cut in price, then that is likely to be a preferable option.

 

If you did choose to undersell the house and you are left with a shortfall, you could negotiate with the mortgagee to accept what the house sells for as a full and final settlement of the debt. The alternative is to make an arrangement to repay any shortfall on a weekly/monthly basis - it may be the case that once you're on pensions they will not think it is worth chasing you for any shortfall.

 

You need face to face advice on the best options for you, so I would suggest you contact your local CAB office and/or the local authority department that deals with the mortgage rescue scheme. They can advise you on what to do next.

[tuttle]

I think the mortage rescue scheme money got used up in 10secs flat, everyone jumped on it, and i bet some fraudsters too.

[Lea_HTH]

I think the mortage rescue scheme money got used up in 10secs flat, everyone jumped on it, and i bet some fraudsters too.

 

Then you'd 'bet' incorrectly. The scheme is woefully underspent and if someone qualifies then it is a fabulous scheme that allows people to stay in their homes.