Ulster Bank Unsustainable Mortgage

Discussion in 'Mortgage arrears & negative equity case studies' started by Aliloan, 9 Feb 2019.

  1. Aliloan

    Aliloan New Member

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    Hi
    I have a mortgage with Ulster Bank. I have a tracker rate. I was on an arrangement with them but paid P & I. I earn 20k per year and also have FIS of 90euro per week. My mortgage runs until 2038 and although I am not in arrears they have told me my mortgage is unsustainable. They advised me of the Mortgage to Rent scheme but although it's a struggle each month paying the mortgage I am terrified of not owning my own home. My 2 daughters are adults now although the youngest 18 lives at home still. I never had much left after paying my mortgage for anything but always thought when I die they would have the house. I feel such a failure. Is there any such thing as switching to a council loan rather than mortgage to rent. Is there anything I can do to keep my home at affordable monthly payments..of around 400 pm. Loan balance is 134k valued at 120k.
    This is my first time posting so sorry if I've done anything wrong. Bank told me this on call going through finances last Saturday.. They sent valuer down on Wednesday. I'm so scared and clueless..
     
  2. Brendan Burgess

    Brendan Burgess Founder

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    First of all, read this Key Post:
    What to do if you get a letter saying your mortgage is unsustainable

    Loan Balance: €134k
    Valuation: €120k

    Your repayments on €134k over 19 years at 1% would be €645 per month.

    The interest on €134k @1% is about €100 per month. The rest of the repayment is capital so you are gradually reducing the mortgage balance and you will eventually build up equity. So keeping the house is the right idea.

    I presume that the only reason you are not in arrears, is because Ulster Bank did a deal with you?

    How much are you paying at the moment?

    What sort of deal do you have or did you last have with Ulster Bank?

    Is the daughter who is living with you working? Can she contribute to the running costs of the house? Will she be able to do so in the medium term?

    Can you rent out a room in the house now or in the medium term?

    What age are you?

    What you should do...
    Continue paying €400 per month if that is all you can afford.
    Document your conversations with Ulster Bank.
    Ulster Bank will probably try to pressurise you into a voluntary sale, but you must be clear that you will not be doing that.
    They are unlikely to take legal action while there are no arrears and while you are paying the interest in full and reducing the mortgage.
    If they do take legal action, make sure to go to court and tell the Registrar your story. Ulster Bank has not got a home in hell of repossessing your home.
     
  3. Aliloan

    Aliloan New Member

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    9
    Thanks Brendan
    I am 51. My Daughter is doing her leaving cert this year.
    I was paying €448 in the arrangement and can just about afford to continue with paying that.
    I lost child benefit when she turned 18 in January and will lose FIS when she finishes college. She will be deferring for a year due to health issues.
    I am looking at the rent a room option. I don't know if I would still be entitled to a medical card and a grant for her if and when she is able to go to college if I have rental income.
    Thank you for coming back to me I will just continue paying them all I can and see what they send me in this pack they are sending.
    I've rung my solicitor too and will go to him with it when it arrives. Thanks again
     
  4. Marobar1

    Marobar1 Registered User

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  5. Aliloan

    Aliloan New Member

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    Thank you yes I will go to them too
     
  6. Brendan Burgess

    Brendan Burgess Founder

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    Don't bother with your solicitor. This is not a legal issue.

    MABS is a good option.

    Brendan
     
  7. Brendan Burgess

    Brendan Burgess Founder

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    Has this arrangement come to an end?

    Brendan
     
  8. Aliloan

    Aliloan New Member

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    Yes since December that's why we had the call last Saturday to go through financial statement. So I would be in arrears if I don't pay the higher amount from now on. When he put the numbers in it came back as unsustainable. He told me this on the call and advised that I would get a letter and pack in the post regarding mortgage to rent .
     
  9. Brendan Burgess

    Brendan Burgess Founder

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    OK,

    So you will go into arrears. No big deal. After two years, you will be about €5,000 in arrears. They would be laughed out of the court if they tried to issue repossession proceedings for that amount.

    There are much higher priorities for them - people who are paying nothing and not returning calls.

    It's easy for me to say, but try not to worry about it.

    What county do you live in?

    Brendan
     
  10. Aliloan

    Aliloan New Member

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    I live in Westmeath.
    I've done a lot of reading on mortgage to rent since talking to them. I know full well that I probably would be eligible based on income etc. It took me a long time to get my own house as a single person. I'd probably actually have some sort of quality of life on mtr rather than just working my heart out for minimum wage to keep my house but at the end of the day I want to keep it.
     
  11. mugsymugsy

    mugsymugsy Frequent Poster

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    As Brendan has said keep to what you have been doing. Ensure all correspondence is by letter and keep a copy of all notes with dates and timelines .

    Further down the line if a child can help with additional funds towards the mortgage then this will help.

    Best of luck with it!
     
  12. Aliloan

    Aliloan New Member

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    Thank you
     
  13. Brendan Burgess

    Brendan Burgess Founder

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    MTR is not for you.

    You have a very cheap tracker. Every month, you are reducing the balance you owe. It will be a tough grind for a few years, but then you will own the house outright.

    Brendan
     
  14. Aliloan

    Aliloan New Member

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    Thanks Brendan
     
  15. bleary

    bleary Frequent Poster

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    Is it as black and white as that ? The op is currently barely meeting the mortgage. Income is very low.
    Effectively fis is paying the mortgage and that will end in a couple of years . They owe 110% of the value of the house they have been effectively renting the house paying a mortgage in excess of the house value.
    How will they pay the mortgage when Fis ends.
    Realistically will they be able to work and earn to the age of 70?
    Realistically will the kids want the family home? How likely are they to move home after college. Have they spoken to them about what they want?

    I'm not saying mtr is the way to go but I would consider it at least. You wouldn't have the same bills as now, maintenance costs etc. It just might give you a peace of mind you'll never have struggling for the next 20 years .
     
  16. Aliloan

    Aliloan New Member

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    Thanks I know what you are saying and believe me I have run this over in my head a million times.
    It will be tough as it's always been to pay but at least the house will be mine. I will consider letting a room when my daughter is in college. I expect I'll work until I'm 65/66 anyway.
    I suppose my original post was about whether I was foolish to even consider going up against their proposal. I see now that it is not. Hard work and struggle is how it's always been that's not my concern. My concern is not owning the house. It's all I've worked towards in the first place. Thanks again for your response.
     
  17. Brendan Burgess

    Brendan Burgess Founder

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    Maybe not black and white. But it's fairly clear.


    If he is on MTR, he will have to pay around €3,000 a year in rent.

    With a cheap tracker, he is paying €1,200 a year in interest.

    In about 4 years, he will have cleared the negative equity.

    He will be freer to do what he likes with it.

    If he were at the very last stages of the repossession proceedings e.g. an order had been granted with a 6 month stay on execution, he might consider it then. But no need to give up ownership now.

    Brendan
     
  18. Aliloan

    Aliloan New Member

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    I am a she and the sole owner of the house. I will consider everything carefully when they send the letter/pack. In the meantime I will be paying as much as I can each month which includes principal.