Letter from solicitor for immediate repayment, or property returned?

Discussion in 'Mortgage arrears & negative equity case studies' started by munchy, Mar 1, 2017.

  1. munchy

    munchy Frequent Poster

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    Hi all. I have lived in London since 2012. For a few years now I have had long periods of unemployment, poor health etc have meant that for some time I couldn't pay the full mortgage to the EBS, and then when I left I got a tenant and send all the rental to the bank, which has been less than the full repayment amount for a few years now. Arrears have steadily accrued.

    The property may be worth 180k at a push with an outstanding mortgage total of around 240k incl the arrears. Over the past few years I have been back and forth endlessly trying to reach an agreement with EBS (mostly them writing a strong letter regarding arrears on the property, and me asking for interest-only and sending off a Financial Statement and them not responding for another 6 months until sending off the next letter, and not referencing my correspondence. Round and round going nowhere)

    So I just got a letter from a solicitor saying that they want the 240k within 7 days, or the property returned. Do I understand that if I return the property, it settles the debt? They dont mention any requirement to pay back a shortfall, or reach and agreement etc. They said that if they dont hear from me, they can reclaim the property at any time without warning.

    Does anyone else have experience of this? Do they suddenly turn up after 7 days or is there time to decide what to do, and at least give my tenant fair warning etc?

    I have no appetite for a long drawn out legal argument and also dont have the money to pay the total back.

    I appreciate any information or advice.
     
  2. mathepac

    mathepac Frequent Poster

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    You will indeed be liable for any shortfall as well as any other costs incurred in recovering and securing the property.

    Is mortgage for an investment property or residential? There may be differences in the legal processes required to recover possession of the property by the bank but AFAIK they cannot simply show up and without the benefit of court orders for possession etc.
     
  3. Brendan Burgess

    Brendan Burgess Founder

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  4. munchy

    munchy Frequent Poster

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    It was a residential properly (my home) until I left and got a tenant to help with the mortgage. So they still regard as a residential property I guess

    Could someone recommend a professional who I can call asap? Ive only a few days to get to the bottom of it. Either a lawyer or accountant?
     
  5. munchy

    munchy Frequent Poster

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    This list of questions doesnt apply as it has gone beyond assessing the feasibility of arrears - the bank has made a call and I need to understand the next legal steps to take.
     
  6. Setanta12

    Setanta12 Frequent Poster

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    Are you still in the UK Munchy? What date was the letter received? Have you kept copies of all your correspondence with the Bank, and copies of their correspondence with you?
     
  7. munchy

    munchy Frequent Poster

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    Yes I left years ago and they have had my local postal address since 2013. The letter arrived yesterday and dated from 26 Feb. I have copies of all my numerous and fruitless emails, and registered mail letters over the years. In fact I thought Id sell it when the value rises and put it behind me (maybe a couple more years) I owe like 1600 pcm and I send them the rental which is 1100pcm. So they have always had something coming in.
     
  8. munchy

    munchy Frequent Poster

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    Happy to hand property over and walk away (its been a nightmare in other respects too - regarding the management and dilapidation etc) but terrified of a drawn-out court case or continuing to be in debt to them.
     
  9. deanpark

    deanpark Registered User

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    I used the good services of Irish Mortgage Holders Organisation (for free) who liaise with distressed mortgage holders and EBS. I got a writeoff of a large amount of the shortfall owed to EBS.

    I would advise you get IMHO on the case and let EBS know you intend to use them to represent you.
     
    munchy likes this.
  10. munchy

    munchy Frequent Poster

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    Amazing advice, thanks so much. This exactly what I needed.
     
  11. deanpark

    deanpark Registered User

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    Let us know how you get on Munchy.
     
  12. munchy

    munchy Frequent Poster

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    Hi there. So have made some calls and the guys at IMHO have been friendly and move fast. However he said it was unlikely I could get a write-off and I would "definitely be liable for the shortfall" (fair enough, I guess)

    I must fill in another SFS

    What I am finding confusing is that if I am earning a higher salary, they are more likely to reach and agreement (ie maybe hold off selling for a few more years until prices increase?) but with a low salary and less ability to repay, they will probably force a sale and judgement now. How does that work?

    Ive got a good contract now but its been years of no or low employment before so Im starting over without much security so I hope they can see that.
     
  13. munchy

    munchy Frequent Poster

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    So the thing which really makes me anxious is the idea of debt collectors coming to my home in London. My current bank accounts have my PO Box details on them. However, if more paperwork is required by courts, they will likely find out where I live. It really bothers me - folk coming to the house.
     
  14. Bronte

    Bronte Frequent Poster

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    Munchy please be logicial. You have no Picasso on your wall in London do you? What on earth are you thinking they are going to call to your house for. Your TV set. You're not even close to that step yet. I can't see an Irish bank going after someone in the UK who is only earning enough to pay rent and live.

    What advice did the IMHO give you as to the next step you should take? And he is correct, you will be liable for the shortfall, when they reposses and sell, but that's only a legal fact, but it does not mean they will necessarily pursue you. That depends on many things. Getting the house gone would seem to me to be the beginning of the end of this nightmare for you. Try and see that.
     
  15. munchy

    munchy Frequent Poster

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    Hi Bronte. Thanks for that. My anxieties are racing at the moment. What would be ideal is for them to wait a few more years until property values increase and they can recoup all their money including arrears. The guy at the IMHO said something along the lines of "yes they will likely pursue this" so I had a vision of fighting it in London. Thanks again for the input. I hope we can reach an agreement without going to court etc.
     
  16. deanpark

    deanpark Registered User

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    Hi Munchy. Glad you got in touch with IMHO. At least you will buy yourself some much needed thinking
    time by getting IMHO involved. From your previous posts on this I can see you are panicked but at least IMHO will go through a process with EBS and it may turn out better than you are fearing. If you had left it and tried to sort out on your own I don't think it would be advisable based on the experience you have had to date with EBS. From my own extensive (!) experience of EBS they are fair to deal with and are one of the more understanding banks amongst all of them.
     
  17. munchy

    munchy Frequent Poster

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    Hi Deanpark. Amazed to hear about your experience with EBS although it may be because properties have started to increase in value again. At the depth of the recession they were very closed and would not engage with me despite me sending long letters etc.

    I have heard that banks can sell debt to local UK collectors who can harass and bother people. That terrifies me as I hate confrontation. Also I've started a small business and it's breaking even do far and I've cash in the bank to pay tax etc. I wonder how the banks and their legal teams will view this? Less or more risky for them?

    The ironic thing about all of this is that with all this money I owe them I've actually had no direct benefit - no cash / cars / free accommodation etc. It's been created because the mortgage simply could not be sustained and arrears gave crept up and up.

    The guy I spoke to at IMHO was a bit snappy with me - sounded almost sympathetic to the bank. I also have a recommendation to use a friends solicitor who helped her successfully

    Now is it it better to use a solicitor or mortgage expert? Tricky