house repssession

[Sgt.Rock]

Does an individual who has had their house repossessed have any financial obligation to the bank/building society etc who have repossessed their house?

[Eve]

Can you put it in some context?

Do you mean can they still chase up and outstanding amount if the sale of the house was not enough to fully discharge what they were owed?

[Sgt.Rock]

More than 3 years after being repossessed a friend has received an order from the mortgage company for �46k. The company cannot give a breakdown of what the amount is for and I'm pretty sure the house was sold for more than the outstanding mortgage amount.

[Eve]

Has your friend contacted them to ask what it is about and why so long after the event?

Had they taken out any additional borrowings from the bank (or from anyone else who may have sold the debt onto the bank)?

[ZopaUser]

There is a debt owed to the mortgage company - this will be the mortgage any arrears, outstanding interest and charges which will include court, repossession and sale costs. The mortgage company will persue the balance if not fully discharged by the sale of the house. On the other hand if there is any residual, this is paid to the borrower.

[Sgt.Rock]

J - Yes but I don't think they are getting much sense.

Not that I know of.

Zopa, Is it possible for the company to do this over 3 years after the repossession? I'm pretty sure the house went for well more than the 46k they are asking for.

I get the idea my friend does not have much cash at all, what happens if they are unable to find the requested 46k?

[buildersmate]

The mortgage company must provide a breakdown of what the claim is for - its as simple as that.

[Sgt.Rock]

That was my thought buildersmate, he is trying to get that but not getting anywhere, mortgage company is being a bit stroppy.

[Skyline D]

"I'm pretty sure the house went for well more than the 46k they are asking for"

That in itself is a meaningless statement if it actually says what you meant it to say.

If for example he owed �200k on his mortgage and they sold the house for �154k then they would have sold it for "well more than the �46k" but he would still owe them �46k (plus any costs of the court action and sale of course).

[redcrx]

http://www.nethouseprices.com/
see if you can see here what it sold for.
Id have thought that interest and costs would be added by the mortgage company til it sold.

[themas]

If the total costs to the lender (outstanding mortgage loan, arrears of interest, all selling costs etc.) total up to more than the selling price then there is a shortfall. If this is the case then yes, the lender can chase for it. In some cases for 12 years, but under a voluntary Council of Mortgage Lenders (CML) agreement in a lot of cases for 6 years. So they are well within the time limit.

They have to provide a detailed breakdown of what they are claiming, with the selling price and all the costs itemised. This needs to be checked carefully, and anything that looks dubious queried. If they went to Court with their claim, they would have to produce this detail so it is absurd of them to say they can't provide it. They should be told that, unless they provide it, nothing will be done to try to come to any payment arrangement because they have not produced any evidence that any money is owed. If they are a CML member and still won't act properly, complain to CML or FSA.

If money is owed then it should be possible to arrange an instalment payment arrangement based on the income and reasonable expenses of the debtor; alternatively if the debtor can borrow (or get from family) a proportion of the amount a full and final settlement offer can be made. If advice is needed on this, go to the local CAB or call CCCS.