"All Sums" v "Present and Future Advances" Mortage Types

C

Ceres

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I'm in the process of moving my mortgage on my current property. I am building a house in the next year and will need another mortgage for that.
I've been told by my solicitor that if I take out an "All Sums" mortgage on my current property, and run into difficulties paying it back in the future, the Bank can call in my home house (which I am about to build. Solicitor says this would not be the case if the mortgage type was "Present and Future Advances". In that case, both mortgages would be secured seperately. If I run into trouble paying back current property in the future, they cannot touch my home house.
Anybody have any knowledge on this? I'm confused!

Thanks....
 
With all due respect, if your Solicitor cannot explain this in clear concise language you have the wrong person dealing with your transactions.
 
Thanks for the reply Slinky,
However, the bank manager and solicitor are saying different things. I'm hoping to get some views on this forum to clarify the situation. Can you explain the terms to me in a straightforward way?
 
my understanding is that what is called all sums and present and future advances are in effect the same. the mortgage secures what it says. the other mortgage type is often referred to as a principal sum or fixed sum mortgage. this will only secure a specific mortgage sum which is scheduled in the mortgage and even if this loan is reduced it will still only secure the reduced sum. if you wanted a top up mortgage loan you would need to execute a fresh mortgage
 
Ceres said:
I'm in the process of moving my mortgage on my current property. I am building a house in the next year and will need another mortgage for that.
I've been told by my solicitor that if I take out an "All Sums" mortgage on my current property, and run into difficulties paying it back in the future, the Bank can call in my home house (which I am about to build. Solicitor says this would not be the case if the mortgage type was "Present and Future Advances". In that case, both mortgages would be secured seperately. If I run into trouble paying back current property in the future, they cannot touch my home house.
Anybody have any knowledge on this? I'm confused!

Thanks....
Click to expand...

It probably does not matter very much. If you owe money on a mortgage and if you default on the mortgage, the lender can use the default under the Mortgage Deed to take proceedings and seek possession. If you owe money for a car and you default, then unless you have an "all sums due" mortgage, the lender will have to sue on the debt to obtain a judgement to register as a mortgage. Its swings and roundabouts.

Most Mortgage Deeds now are on an "all sums due basis" - i.e. its all sums due by you to your lender whether by way of mortgage or not.

mf
 
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