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Bossc@
Starting Member
United Kingdom
25 Posts |
 Posted - 06 May 2009 : 12:47:37
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Hi
We went BR on 22nd January and found ourselves a rental property and moved out of the home on 30th Jan. We had previously tried to negotiate mortgage payments with the Mortgage company but they were extremely unhelpful. Anyway, we notified them of our intent to hand the property back and on our I&E forms for the Or put down the shortfall due to negative equity etc (based on a valuation at the time) on the forms. The keys were sent back to them recorded delivery and they have admitted to us and the OR that they have them. They have sent us several forms that they say we must fill in before they will take possession back. As far as I'm concerened they have been sending us deeds of acknowledgement and we've scrapped them on advice of the CAB and the OR helpline.
Our case was passed to the RTLU not long ago and we received a letter from the RTLU yesterday, enclosing anotherform from the mortgage company, stating that the mortgage company have been unable to take possession as we have not filled in the forms. The RTLU say that until they are signed and returned they will have to apply to the court to take possession.
I spoke to an officer at the rtlu yesterday and he said as far as hes concerned any shortfall in will be covered by the BR but I'm not convinced as this is different to what we have been advised.
We're both worried that if we sign this and return it then we could be lumped with another debt outside of our BR. What happens if we get discharged and the ouse isn't sold until afterwards - are we then going to under this massive cloud again?
Sorry about this but the body of the letter from the mortgage company is below:
"I/we the undersigned consent to the giving of voluntary possession of the above property to the Bristol & West Mortgages as mortgagee. I/we will be vacating the mortgaged property on: ____________________ and possession of the property can therefore be taken after this date.
I/we acknowledge that the power of sale which is set out in the Residential Mortgage Conditions and which we accepted when we signed the Mortgage Deed in favour of Bristol & West Mortgages, becomes exercisable with delivery of possession to the Bristol & West Mortgages of the mortgaged property.
I/we further undertake to remove all personal effects and chattels from the mortgaged property by the above date and acknowledge that in respect of such items left in the property after that date, the powers referred to in the said Residential Mortgage Conditions shall immediately apply in favour of the Bristol & West Mortgages without any necessity on its part to give any notice written or otherwise.
I/we acknowledge that the Bristol & West Mortgages and the Indemnity Insurance Company (if applicable) reserve the right to enforce ther personal covenants contained in the said Mortgage Deed against me/us and that I/we remain responsibl for the payment of the Mortgage Debt. I/we understand that the term "Mortgage Debt" includes all interest payable under the Mortgage Deed which will continue to accrue however long it may take Bristol & West Mortgages to sell the property. If there is not enough from the sale proceeds to fully repay the Mortgage Debut due under the Mortgage Deed we understand that we will still be responsible for paying the balance.
I/we confirm that I/we are fully aware of te implications of giving Voluntary Possession of the Mortgaged Propery."
Sorry for the essay but this is really worrying us now. |
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gettingoutofdebt
forum expert
2418 Posts |
Posted - 06 May 2009 : 13:22:13
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Hi,
I have seen a similar letter on another forum and the recommendation is NOT to sign and just hand the keys back to the mortgage company. If the mortgage company have already admitted to you and the OR that they have the keys then there shouldn't be a problem.
If the property was in negative equity then the shortfall is included in the BR and you normally have the option of buying the property for £1 provided you have/can keep up the repayments.
"The RTLU say that until they are signed and returned they will have to apply to the court to take possession."
I would tell them to apply to the court. You have nothing to lose as the shortfall is included in the BR, the mortgage company has admitted to taking the house back and you are not residing in the property.
Send a letter back to the mortgage company noting the dates that you left the property, were made BR, they admitted receiving the keys to the property and that you have been advised by the CAB and OR not to sign the letter. |
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gettingoutofdebt
forum expert
2418 Posts |
Posted - 06 May 2009 : 13:39:47
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Managed to find a letter that you could use to send to the mortgage company:
DATE
NAMES
ADDRESS
Dear Sir/Madam,
Re: Account No. xxxxxxxxx. Address as above.
With reference to the above and your letter dated DATE_OF_LETTER within which you enclosed a Voluntary Surrender statement for us to complete and return. We will not be signing the aforementioned statement and would request that you take this letter as our formal request for the voluntary surrender of the property.
We voluntarily surrender possession of the above mentioned property to NAME_OF_MORTGAGE_COMPANY and agree to the sale of the property.
We understand that the proceeds of the sale will be applied to the account to pay off in whole or in part the balance outstanding.
We note that NAME_OF_MORTGAGE_COMPANY are at liberty to remove and/or sell any items of a personal or household nature remaining in the property after the date of our giving possession.
We confirm that the property has been vacant from DATE_YOU_MOVED_OUT.
For your information, we can now be contacted at the following address and would request that all correspondence be in writing only to this address:
NEW_ADDRESS.
Yours faithfully,
NAMES.
Apparently there are some clauses within the mortgage agreement that if you sign the voluntary possession form then you could be liable for any shortfall so definitely don't sign in. |
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Bossc@
Starting Member
United Kingdom
25 Posts |
Posted - 06 May 2009 : 22:07:37
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Thanks for that, thats exactly what we thought. We've already sent a letter in a similar veign as to the one you've posted along with the keys and we had a call shortly afterwards to say they wouldn't accept the house back until we'd signed the form.
They also sent a form to the examiner asking to forward it to us and then contacted us shortly after to say that they had spoken to the examiner who advised that we should sign and return it. I then spoke to the examiner who said she had done nothing of the sort and simply said she would forward it but we should take independent advice as to whether we should sign it or not. They have then sent another form to the RTLU as per my original post. I spoke to the RTLU officer who again said we should seek advice as he couldn't advise us but the upshot is that the company should apply to the courts for repo as per their covering letter.
Just when you think that the letters and calls stop..... |
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frosie90
Junior Member
285 Posts |
Posted - 06 May 2009 : 22:19:54
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Hi Bossc@,
I had similar letter from Northern Rock and refused to sign it. I sent my keys off by recorded delivery but they said they would not accept voluntary without a forwarding address. Having spoken to my OR though I ended up deleting the paragraph that said about "being liable for shortfall" etc. which I think quite a few people have done on this site. I put my forwarding address on because the OR said he would be including this on his letter to them anyway. I think with the form as long as the paragraph is deleted/crossed out it is ok???? I have included the estimated shortfall in the BR. It is all very worrying though. I am going to send a copy of the form to my OR when I send my I & E form to him. |
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Bossc@
Starting Member
United Kingdom
25 Posts |
Posted - 08 May 2009 : 14:08:40
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Thanks for the replies all. I've found this on the insolvency.gov.uk site
Question: If my house is sold sometime after the bankruptcy order is any shortfall on the mortgage still a debt in my bankruptcy?
Answer: A debt which is secured by a mortgage or a charge on a property is still a provable bankruptcy debt. The mortgage loan company is "a secured creditor" which means they have rights over an asset, the house, and can require the asset to be sold to pay their debt. These rights are not affected by the bankruptcy.
On the making of a bankruptcy order the mortgage loan company could
make a claim in the proceedings but, unless it wished to give up the security, could only claim for any (estimated) shortfall.
If you continue to live in the property it is likely that you will continue to make payments to the mortgage loan company to avoid the property being re-possessed. When the property is eventually sold any
shortfall to the mortgage loan company is still a provable debt in the bankruptcy, even if you have been discharged, as you are released from the debt on discharge.
Your bankruptcy does not affect the obligations of any joint owner who has not been made bankrupt to repay the mortgage loan debt or any shortfall, as they are still liable for the whole of the debt.
After the date of the bankruptcy order the mortgage loan creditor may ask you to sign a "deed of acknowledgment" of the outstanding debt. If you have signed such a deed the mortgage loan creditor can take action against you to recover any shortfall following the sale of the property.
I've advised the RTLU that I wont be signing it.
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Voluntary repossession.
