UB wants me to surrender home in positive equity : Good outcome evenutally

Discussion in 'Mortgage arrears & negative equity case studies' started by Polly 123, 26 Aug 2018.

  1. Polly 123

    Polly 123 Registered User

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    Last edited by a moderator: 24 Jan 2019
    Thread title updated to reflect outcome - Brendan

    I am currently finished a 5 year deal with my mortgage supplier which was at a reduced interest rate and following 2 other short term options lasting 6months and 1 year respectively.

    I have again completed an up to date MARP form for consideration and I got a call to say that when they input the figures its is coming up as voluntary surrender.

    Current Mortgage 120k
    Current value 255k
    Years left to pay - less that 7 of a 20 year mortgage

    Less that 1k arrears at present, this is down to them losing my MARP forms in the first case and then having to wait for a slot for a customer services rep to call me which took 6 weeks.

    I have never missed a payment in the last 6 years I have always kept in contact with them, I have asked them to consider spreading my repayment over 20 years to allow us to stay in the house, this will be possible as the payments are similar to now and I hope to rejoin the workforce even part-time within the next year or two, (I am a single parent with a special needs child who does not attend school on a full time basis)

    Is it possible to negotiate something like this when voluntary surrender comes up following their assessment?

    How many times can you use MARP or be under their protection?

    My main concern is to keep a home for myself and my child to live it, I know I would have approx. 120k clear if I sold it myself now but I would get nothing in our local area for this amount for us to live.

    Any suggestions, encouragement or advice while I am waiting for them to come back to me in writing about what my options are?
     
    Last edited by a moderator: 24 Jan 2019
  2. newtothis

    newtothis Frequent Poster

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    First of all, your situation is far from unique and you are definitely not alone. Just out of interest, who is the lender?

    I would deal as much as possible by letter rather than phone call. No harm in taking a phone call, but always follow up with a letter summarising what was discussed and any actions agreed. It's important to create a paper trail to back up your side of the story should the need arise.

    Waiting six weeks for a phone call is crazy, but not in the least surprising.

    It's hard to say if you have a sustainable mortgage without seeing more details. However, if you are making reasonable efforts and payments cover at least the interest and part of the capital your chances of your home being repossessed are practically zero due to the helpful attitude of the courts.

    The advice to go to one of IMHA or New Beginning is good, though by no means obligatory. You do need independent advice however to establish whether or not your position is sustainable (it sounds like it may well be from what you say, but that’s a guess). If it genuinely isn’t sustainable, you might be better off putting your efforts into a plan B rather than continuing on with a potentially long and stressful path.

    You can of course make a counter offer to anything the bank proposes. If they reject it and only suggest voluntary surrender or repossession and you believe you can ultimately pay the mortgage off, just set out that this is what you will do and start doing it. They may or may not start court proceedings: if they do, by documenting that you have told them this will help you. Although the courts are sympathetic and very unlikely to act against you if you are making best efforts, it is extremely stressful so hopefully it won’t come to that.

    Do not under any circumstances stop making payments; even a token amount if you’re particularly stretched financially is better than nothing.

    Best of luck!
     
  3. Polly 123

    Polly 123 Registered User

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    Apologies for delay in replying, have had a lot going on .

    I cant seem to copy the link you show above Brendan but I've included everything below,thanks

    INCOME:
    Social Welfare for One Parent family/ reduced carers 1,344
    DCA 309
    Child Benefit 140
    Maintenance 160

    Car needed for medical appointments
    Childcare costs - Nil (family helping out)


    HOME LOAN
    Lender : Ulsterbank
    Outstanding: 120,400
    Value of Home: 250k-260k
    Interest Rate : SVR 4.5%
    Monthly Payment due (following 5 year agreement: 1,513
    During agreement 620
    Amount in arrears 1,800 (shortfall of actual full payment and affordable payment x 2 months while waiting for UB to come back to me)

    No Investments

    Credit Union Shares 90.00
    Credit Union Loan 265.00


    OTHER loans and creditors

    Credit Card 2,500 @19%
    Paying minimum €80 pm

    No other loans
    No other savings
    No lump sum expected

    HOW IMPORTANT IS IT RETAINING YOUR FAMILY HOME

    I really want to keep the family home


    ANY OTHER RELEVANT INFORMATION
    I am trying to find part time employment for when child is in school so not to have childcare costs unfortunately not much going in our area, probably will earn minimum to €10 ph based on jobs in local area. Mortgage was taken out when I was in full time employment and there was never an issue with payment, work was then reduced to part time but could still make payments. Eventually job went, worked with UB on agreeing on interest only term when working on a CE scheme after that, they agreed a new 5 year plan which was reduced interest rate, all payments were made monthly and never missed since I've been in MARP. Contacted UB in April regarding options when deal was up in August, got a reply in late May, completed SFS with all info requested and sent by registered post, heard nothing so rang 3weeks later they had no record of my SFS so gave me date and time for 7 weeks later when I would get a call from arrears support unit, in the meantime full mortgage repayment was due and another one due tomorrow, could not afford it so continue to pay the 620. Spoke to agent from arrears support 2 weeks after agreed time and date, completed SFS, came back saying voluntary surrender. Suggestion of extended term, gone to underwriters for consideration and was to expect a reply within a week, nothing back and heading into 3rd week.


    PREFERRED REALISTIC OUTCOME?

    Obviously it is very important to me to keep my home. I am suggesting that the remaining term on my loan be extended to the longest term possible to allow me to be able to make affordable payments and stay within our home. There is currently approx. 7 years left on a 20 year mortgage. I would hope that I will be in a position to return to work in the next while, I understand I am very welfare dependent but for the moment I need to deal with my current situation which is being a carer for my child until school becomes more full days. I cannot rent out a room due to my child, if I was to sell there is nothing I could afford within a 20mile distance.

    Many thanks
     
  4. Brendan Burgess

    Brendan Burgess Founder

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    This is tough as it does seem that your mortgage is not sustainable.

    You can't afford the repayments on a mortgage of €120,000.

    Even if they reduce the rate to 2.4% and extend the term to 20 years, then the repayments would be €630 per month.

    This is a failure of public policy.
    1) There is no reason why a mortgage like this should not be put on interest only indefinitely. You have positive equity. There is no risk to the lender. But the Central Bank does not allow this and the banks don't want it either. It makes no sense.

    Interest only at 2.4% would be €240 a month which you could afford. So what if you are not paying down the capital?

    2) The second failure is that we should do what they do in the UK. The government will have to house you if you lose your house. It would be much cheaper for the government to pay your mortgage for you and treat it as a loan secured on the house.

    Joan Burton got rid of the Mortgage Interest Supplement which was crazy. We now have a ridiculous Mortgage to Rent which is no good to you as you are not in negative equity.

    3) The third failure is that we allow banks to charge 4.5% SVR on loans like this.

    So what to do?
    1) Contact your local TDs and tell them how stupid our policy is.
    2) Write to Governor Lane of the Central Bank and tell them how stupid our policy is.
    3) Continue paying the €620 you are paying.
    4) Write to Ulster Bank and tell them that this is enough to clear the mortgage over 20 years.
    5) Tell Ulster Bank you want to fix your mortgage rate for 2 years at 2.3%
    https://www.askaboutmoney.com/threa...e-to-2-3-fixed-for-two-years-all-ltvs.208751/

    Not sure if they will allow you to fix it for two years as they consider it unsustainable.

    Check out this Key Post
    What to do if you get a letter saying your mortgage is unsustainable

    Ulster Bank may begin legal action.
    Respond to every letter you get in writing.
    Continue paying your mortgage.

    It's very unlikely that the court will give them an order for possession.
    If they begin legal action, they will probably end up rescheduling your mortgage for you anyway.

    Brendan
     
  5. Polly 123

    Polly 123 Registered User

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    Brendan, thank you for taking the time to reply. You have summed up exactly how I see it, yes it not sustainable on paper but I can afford the 620 and have proven this by making these payments without any exception for 6 years, I just need the opportunity for this to be afforded to me. I will write to them to see are they open to any of your suggestions, I will update the post once I receive anything from them, thanks
     
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  6. Polly 123

    Polly 123 Registered User

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    10
    Just to give a quick update, got a letter saying I was 2 months in arrears so I contacted the arrears support to acknowledge letter to be told that the underwriters have refused to agree any further arrangements and my mortgage is deemed unsustainable, I should get written notification within a week and then she said they were offering me 'help with selling my house' to ensure a quick sale, devastased to say the least.
     
  7. Brendan Burgess

    Brendan Burgess Founder

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    No need at all to be devastated. Annoyed and frustrated, yes, but not devastated.

    Continue with the advice above of paying what you can, and respond to every letter you get from them and their solicitors.

    You will not lose your house.

    Brendan
     
  8. newtothis

    newtothis Frequent Poster

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    I would follow Brendan's advice. Write back to them saying that in the absence of them offering you an arrangement you will continue to make payments at the same rate; that this covers all of the interest and some capital; you will increase the amounts as and when you can afford it and that you have every intension of paying off the complete amount over time. It is inconceivable any court would order a repossession in these circumstances. Any further letters from them along the same lines, just repeat. If they start harassing you, they are only digging a deeper hole for themselves: just make sure you have all interactions documented so you can present your case if it comes to it. You are not alone. Best of luck!
     
  9. Brendan Burgess

    Brendan Burgess Founder

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    I didn't stress this enough. Some people claim in court "I spoke to someone and they said xyz..."

    After every call, for example today's, write down the name of the person to whom you spoke, the date and the time.

    Show that you are proactively trying to resolve this.

    if it goes to court, the legal team for Ulster Bank will be embarrassed.

    Brendan
     
  10. Brendan Burgess

    Brendan Burgess Founder

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    One more suggestion. Most people seem to believe that there is a tsunami of repossessions happening in every court in the country. That the banks are evicting people every day.

    Ring your local court office and find out when the next repossession hearings are on. Go down and watch what happens. You will come away with a new lease of life.

    Brendan
     
  11. newtothis

    newtothis Frequent Poster

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    I would take this a stage further. If anything significant is said to you over the phone, note down the details as Brendan suggests. However, I'd go on to write to them stating what was said on the phone and stating that unless you hear from them to the contrary within 10 working days that you will take it that they agree this is a true and acurate record of the conversation.
     
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  12. Polly 123

    Polly 123 Registered User

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    Many thanks for replies and advice, I will reply to their correspondence when I get it and follow advice above, I have been keeping record of all phone calls received and made together with peoples name and dates and times of calls since April. I really appreciate the glimmer of hope, I will update with any future developments
     
  13. Brendan Burgess

    Brendan Burgess Founder

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    It's not a glimmer.

    Ulster does not have a glimmer of hope of repossessing your home. If you tried to lose your home, it would take some years.

    If you continue as you are, you will have it paid off before they get an order.

    Brendan
     
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  14. rameire

    rameire Frequent Poster

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    you need to reduce the interest rate on your mortgage to help reduce the increase in debt.
    if you dont want to fix on the 2.3% for 2 years they have a discounted variable rate of around 3.5% based on an ltv of 60%
    you could even get a rate of 2.8% for 5 years on your ltv if you wanted to fix for a longer term.
     
  15. rameire

    rameire Frequent Poster

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    also, their standard variable rate should be 4.3% not 4.5%
     
  16. Bronte

    Bronte Frequent Poster

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    Don't agree that you have to go all formal there. That's just getting people's backs up. The fact they don't reply and contradict is enough.
     
  17. Sunny

    Sunny Frequent Poster

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    100% with Brendan on this. Keep doing what you are doing. Keep engaging with them and keeping records. If they suggest something on the phone that you are not sure of, ask them to put it in writing. Do not commit to anything they suggest until you have had time to look into it and get advice. Most importantly, don't get stressed (easier said than done I know). You have done everything right up to now. If Ulster Bank want to bring this to court, then let them. It will take them years if ever for them to succeed based on your actions up to now. Best of luck.
     
  18. newtothis

    newtothis Frequent Poster

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    I hardly think one sentence at the end of a letter is "to go all formal". And no, it doesn't get people's backs up; it's just letting them know you are treating them with a formality and seriousness the communication deserves and that you won't be intimidated or pushed around. Trust me: banks don't spare the formality in their own communications to borrowers in these circumstances, so it's hardly starting it either. There's a very specific reason for doing it, which is to prevent them coming back at a later stage to say "we never said that". Just my opinion, of course.....
     
  19. Brendan Burgess

    Brendan Burgess Founder

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    And my opinion too.

    Brendan
     
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  20. Polly 123

    Polly 123 Registered User

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    Just to give an update on what has happened over the last number of months.

    I wrote to the bank appealing their decision to classify my mortgage as unsustainable. My first error was to send the letter prior to receiving notification from them in writing (I had just been notified by phone) but I did it hoping to try get the ball rolling and avoid the arrears continuing to rise and because I had not got anything in writing 2 weeks after the phonecall. I rang them to ensure they received my appeal letter when I had heard nothing after 2 weeks and was advised that they had received it but because they hadn't sent a letter to me I could not lodge an appeal until I received a letter, this took a month in total before I received the letter after the phonecall. Following this I again lodged my appeal of their decision and the came back saying that if I made the payment to extend my mortgage that I would be putting myself under financial pressure despite the fact I had and still have been paying near enough the same amount for the last 6 years. Their suggestion was I sell my home and downsize to a 2 bed house, repay the outstanding balance and purchase a 2 bedroom house somewhere else.

    After this they gave me the option of appealing their decision and complete an updated SFS for independent review. This appeal was successful and the bank needed to try re-negotiate something with me, I suggested a partial writedown of capital, a reduced interest rate for a 5 year period, to park some of the loan and finally to spread the remaining mortgage over the longest term possible. Another SFS later and I've have today received my letter saying they have agreed to extend my mortgage. The offer of a reduced LTV interest rate was not on offer to me at this time. It also states that this agreement does not cover arrears which are now over €5k and will remain on my account and will be expected to be paid down.

    In short I am very happy to be allowed the option of staying in our home, I am thinking of this as a long term rent to own but at least I am paying something down that will benefit the family in the long run. Its been a very stressful 9 months since my initial communication with them, the continuous letters and phonecalls you get from them despite working with them to find a solution were probably the most draining thing, each letter asking you to make contact immediately to discuss your account and when you ring you are told to ignore it that these are automated letters that are generated until a solution has been put in place, you get 2 to 4 of these letters most weeks. On a plus side I was very lucky that the agent representing the bank over the last number of months was nothing only understanding, polite and helpful, the complete opposite of what you have to deal with on the phones so I would highly suggest if anyone is in a similar situation that you meet with them as opposed to filling out SFS etc over the phone.

    Thank you all for your advice it was invaluable to me.
     
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