So my folks lost their home - How do i protect my OWN house?

[HannsG]

Found out today my folks lost their £400k home because they could not pay back £3,500 on their mortgage (mortgage arrears). They have paid of around £350k and had £50k outstanding..

Even though I offered to take on their mortgage and keep the house in their name. They refused...

Our relationship is very very strained, but their pride and complete blindness to the situation has led the family to this...

The bank has terminated the mortgage and want full amount outstanding paid in 4 days...

So. I have my own house. If i was to lose my job where the fk would I be?

Anyone here have a mortgage protection scheme? Is it worth it?

[Beyond Rational]

A mortgage protection scheme? Is that the same thing as having savings?

[miniman]

With respect, surely there's more to it that this? Why would a bank take this approach when the arrears are so trivial in comparison with the value of the property?

To answer your other question - I lost my job this time last year and, despite having payment protection insurance, never managed to get a penny out of them in 8 months because of the frankly ludicrous process one has to go through to get them to do anything at all. I'm no financial adviser, but I rather think that sticking the premium in the bank for the last decade would have served me better.

[HannsG]

Beyond Rational said:

A mortgage protection scheme? Is that the same thing as having savings?

Yup have a years worth of savings set aside to cover mortgage for a year and utility bills.

Bu even then this has scared the hell out of me..

[HannsG]

miniman said:

With respect, surely there's more to it that this? Why would a bank take this approach when the arrears are so trivial in comparison with the value of the property?

To answer your other question - I lost my job this time last year and, despite having payment protection insurance, never managed to get a penny out of them in 8 months because of the frankly ludicrous process one has to go through to get them to do anything at all. I'm no financial adviser, but I rather think that sticking the premium in the bank for the last decade would have served me better.

So...

they have been in arrears for around a year.

Not paying, and then paying, delaying payments etc. Its been going on for a long time now.

I think the bank has just got sick of asking for the money.

They have had warnings and debt recovery chasing them also..

[2 sMoKiN bArReLs]

HannsG said:

Found out today my folks lost their £400k home because they could not pay back £3,500 on their mortgage (mortgage arrears). They have paid of around £350k and had £50k outstanding..

They were already living in an empty house? (otherwise they could have sold some stuff to raise a fairly small sum in the scheme of things)

[HannsG]

2 sMoKiN bArReLs said:

They were already living in an empty house? (otherwise they could have sold some stuff to raise a fairly small sum in the scheme of things)

Father is a business man.

He owns three houses and one business.

His new business venture messed cashflow...

So. this 400k house was his retirement home and he had family stay their mortgage free if they covered all maintenance and utility bills. This was the agreement and it worked...

He was happy with the arrangement. When the money problems happened he was given many solutions to the problems.

I offered to pay it outright. But nope.

[2 sMoKiN bArReLs]

HannsG said:

2 sMoKiN bArReLs said:

They were already living in an empty house? (otherwise they could have sold some stuff to raise a fairly small sum in the scheme of things)

Father is a business man.

He owns three houses and one business.

His new business venture messed cashflow...

So. this 400k house was his retirement home and he had family stay their mortgage free if they covered all maintenance and utility bills. This was the agreement and it worked...

He was happy with the arrangement.

Not doubting you old chap. Just seems odd to throw away £350k (or whatever house is worth) for such a tiny sum. You must admit, sounds odd to an outsider!

[miniman]

It does indeed seem rather odd for someone with four properties and a business to be unable to find £3,500 to keep the bank at bay.

[SystemParanoia]

can i have the £50k that they have refused ?

[Jasandjules]

miniman said:

It does indeed seem rather odd for someone with four properties and a business to be unable to find £3,500 to keep the bank at bay.

A quick re-mortgage would solve it surely?

[davepoth]

HannsG said:

So. I have my own house. If i was to lose my job where the fk would I be?

Being nice to your relatives, presumably.

Don't stretch yourself with a mortgage, keep some savings back to cover the mortgage for a while, and perhaps get an insurance policy, although make sure it does actually cover you properly.

[LeoSayer]

2 sMoKiN bArReLs said:

Not doubting you old chap. Just seems odd to throw away £350k (or whatever house is worth) for such a tiny sum. You must admit, sounds odd to an outsider!

The bank get their £50k back and the home owners get the residual £350k surely?

[p4cks]

I work for a mortgage lender's debt management department and I think that there may be a lot more to this than the OP has led on/been led to believe by his parents.

[gaz1234]

Sounds odd. I know o people not paying for long periods and then art payments etc.. Still n got kind out repo

[Disco You]

p4cks said:

I work for a mortgage lender's debt management department and I think that there may be a lot more to this than the OP has led on/been led to believe by his parents.

I don't work for a mortgage lender, and no st Sherlock.

[Spudler]

p4cks said:

I work for a mortgage lender's debt management department and I think that there may be a lot more to this than the OP has led on/been led to believe by his parents.

Very much this ^^^.

Could be a number of reasons. Mortgage on all of them?

[85Carrera]

I think this is bullst unless there is info missing

Why would a bank repossess a 400k home with 50k outstanding for the sake of 3.5k?

Wouldn't be worth the effort.

[ooo000ooo]

One of my sister-in-laws has been living for quite a while in a "fur coat and feck all in the fridge" manner in a lovely big house that's mortgaged to the hilt. She stopped paying the mortgage for 2 months so she could take her family to Spain for a couple of weeks. Currently 4000 in arrears and looks exhausted with the strain.
Other in laws lost their jobs a couple of years ago but had insurance which has paid the mortgage ever since, thanks to the benefits system where they live, they are better off than when they worked.

[vinnie83]

Jasandjules said:

A quick re-mortgage would solve it surely?

Who would offer a remortgage to someone who has had numerous arrears within the last year?



Also, the bank will repossess, put up for sale, if not sold very quickly, auction it. Once the mortgage, arrears, accrued interest and charges are paid, the change is given back to the original owner.