Dealing with mortgage debt and facing the prospect of losing your home is, without a doubt, a scary and stressful expirence. However, it's important to realise that, even when things progress to court, your home is not beyond saving.
Getting timely and appropriate advice can make all the difference.
These are some of the experiences of Housing Rights Service's clients who sought advice from our specialist advisers.
Mrs M contacted Housing Rights Service after receiving a letter from her lender stating that she must clear the arrears on her mortgage account within 14 days. Failing that, the letter stated that the lender would have no alternative but to commence legal proceeding for Possession of the property against her.
Mrs M fell into arrears during a period of temporary unemployment. During this time the only household income was that from her partner’s part time job. The couple found that they were unable to service all of their financial commitments. The couple had attempted to arrange a payment break from the mortgage by negotiating directly with the lender. The lender, however, refused to agree to this arrangement and said that it was not their policy to offer payment holidays. The lender expected the couple to maintain their current monthly payment of £500.
Mrs M was not able to make any payments to the mortgage. Arrears of £2000 accrued over the 4 month period that Mrs M was out of work. However, she was able to secure a full time permanent position and had arranged to return to work the following month. Mrs M contacted the lender and made an offer to repay the arrears at the rate of £100 per month. The lender requested an Income & Expenditure form from Mrs M before they would consider the repayment proposal.
This concerned Mrs M as she wasn’t sure how to prepare such a statement. She requested the assistance of Housing Rights Service and was able to get help from a specialist adviser. Housing Rights Service was able to prepare a comprehensive Income & Expenditure statement using information given by Mrs M. With her consent, the adviser contacted the lender and negotiated the repayment proposed made by Mrs M.
With the use of the Income & Expenditure statement, the adviser was able to evidence affordability and show the lender that the agreement was sustainable and that the arrears would be cleared within a reasonable period of time. Prompt reaction of Mrs M to her financial difficulties meant that she was able to reach a reasonable agreement with her lender and prevent the problem from progressing. By keeping up with the proposed repayments, Mrs M’s home will no longer be at risk of repossession.
Mr N contacted Housing Rights Service after receiving a Notice of Appointment from his lenders solicitors firm. The notice stated that his case was being heard in the Chancery Division of the High Court in Northern Ireland at the end of the month.
Mr N had accrued substantial arrears on his mortgage after having to give up work due to illness the previous year. He had applied for and was receiving the relevant benefits; however no decision had been made on his application for DLA at that particular moment. Mr N was confident that he will be awarded this benefit and that the amount owing to him would be sufficient to clear the arrears in one lump sum. However, he had no indication as to when the benefit decision would actually be received.
Mr N had been negotiating with the lender for a number of months to no avail. He had offered to pay the lender the amount of the monthly instalment plus £20 per month towards the arrears. The lender didn’t accept the proposal and had said that the level of the arrears is such that they would accept no less than £150 per month on top of the normal instalment. Mr N felt that this is entirely unaffordable and had been paying the normal instalment plus £20 for the last 3 months. The lender was unwilling to halt proceedings pending the outcome of Mr N’s benefit application and had issued a Notice of Appointment.
Mr N contacted Housing Rights Service and working with the adviser was able to prepare an Income & Expenditure statement to show his current circumstances, and also to show provisionally how his circumstances would improve should his benefit application be approved.
An adviser was able to represent Mr N at the court hearing to evidence to the Master his current circumstances, and how they might improve in the near future. Given Mr N’s current circumstances and the fact that he had shown good faith in making payments regardless of agreement from the lender in the run up to the hearing, the Master was happy to grant a Suspended Possession Order on the grounds that the client continues to meet the normal monthly instalment plus pay £20 per month towards the arrears.The Master was satisfied that payment at this rate would clear the arrears within the remaining term of the mortgage.
Mr N’s case goes to show that even when your lender takes you to court, things are not doomed to fail. You can still make a difference by getting specialist help from organisations such as Housing Rights Service. Advisers can represent you in court and are able to identify possible alternatives to repossession at times when the lender is reluctant to agree to your proposals.
Mr and Mrs D contacted Housing Rights Service after receiving a Notice of Appointment from their lender’s solicitors firm. The couple purchased their Housing Executive home 10 years ago, and had managed the payments for many years until Mr D was made redundant. Mrs D is unable to work due to caring responsibilities and substantial arrears have accrued on the mortgage.
Mr and Mrs D applied for benefits and were awarded Mortgage Support for Interest of £300 per month. The normal monthly instalment on the mortgage is almost £900. The couple has 2 young children both of primary school age, and were unable to meet the shortfall of almost £600 per month.Mr D has been unable to find employment and has become depressed as a result of this. He is now claiming Employment & Support Allowance due to his inability to work through illness. He does not think that he will return to work anytime in the foreseeable future.
Mr and Mrs D have been negotiating with the lender for a number of months to no avail. They have offered to pay the lender an additional £100 per month on top of the assistance they receive. The lender states that the level of the arrears is such that they will accept no less than £100 per month on top of the normal instalment. Mr and Mrs D knows that this is entirely unaffordable and has been paying the additional £100 anyway.
The couple decided that they do not want to save the home, and were advised as to how to go about presenting to the Housing Executive as homeless. Housing Rights Service represented the clients at the hearing in the High court, and the Master was satisfied that the mortgage was unaffordable and granted an Order for Possession in favour of the lender.
If you need specialist advice to help you negotiate with your lender about your arrears, or you need someone to represent you at court during a possession hearing, you can give Housing Rights Service a call on 028 9024 5640. A dedicated team of mortgage debt advisers may be able to assist you.