Archive for mortgage arrears
Feb
06
Sub-prime Mortgage Crisis & Chapter 13 Filings
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In recent months, the amount of foreclosures filed throughout the country has more than doubled from the same time period last year. The reasons for such high percentage of filings are numerous. Primarily, the sub-prime mortgages have landed in the hands of individuals who most likely did not qualify for convention financing. Thus, the interest rates on the loans remain higher than other conforming loans. Additionally, many of the sub-prime loan products involved adjustable rates (ARMS) which typically re-set within the first few years of the loans inception.
As sub-prime loans relate to Chapter 13, the typical scenario is as follows: The homeowner qualifies for the loan without a substantial down payment and without significant income documentation. The monthly payment is a stretch for the homeowner; however, it is temporarily manageable. Depending upon the type of ARM, the loan may reset in one, two or three years. It is at that point in time that the homeowner may not be able to make the new, higher mortgage payment. The homeowner is also unable to refinance the debt on the property since the type of loan products needed to accomplish that task no longer exists. Thus, the homeowner is in quite a tough situation. The current real estate market would make it nearly impossible for the homeowner to sell the property and pay off the mortgage. Chapter 13, known as the home saver case, would not be practicable in the case of adjusting ARMS.
The idea behind Chapter 13 bankruptcy is to allow a homeowner to catch-up on whatever mortgage arrears have arisen in addition to making the current mortgage payment on time. As rates adjust and loans reset, the homeowner simply cannot make the current mortgage payment, let alone a partial payment to catch-up. The situation is basically a doomsday for both the homeowner and the mortgage company. The homeowner was banking on the ability to make the payments and/or refinance the outstanding debt at a later date. The lack of real estate appreciation has led to the inability on the part of the homeowner to do just that.
What we are likely to see is a large number of homes on the market for sale. Many of the borrowers will file for Chapter 7 bankruptcy and not Chapter 13 bankruptcy. I believe that the market will take five to seven years to begin to show some signs of appreciation. It will be interesting to see if Congress amends the bankruptcy code to allow mortgage debts to be adjusted. If not permanently, then for a short time frame of three to five years.
Passive Income
Feb
05
How To Escape The Stress Of Mortgage Arrears
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If you have missed any payments on your loans you need to check if they are secured or unsecured on your home. If they are secured then they need to be dealt with urgently as the lender has the power to take possession of your property if they are not paid. We are going to discuss secured loans and what to do if you miss these payments.
Contact your lender
The first thing you do is you need to contact your lender to confirm the amount you owe and the steps you intend to take to pay them back. Many lenders would rather put in place a payment plan than repossess properties but there needs to be dialogue between the lender and the mortgage holder. It is very tempting (and common) for people in arrears to bury their heads in the sand rather than face up to the situation but the earlier steps are taken the better it will be.
Most UK lenders are regulated by the Financial Services Authority (FSA) who have rules saying lenders must deal fairly with any customer who is in arrears. In practical terms each lender must:
* have a written policy on how to deal with customers in arrears;
* allow customers to set up a payment plans which is realistic
* send out regular information about the arrears;
* Not put pressure on customers through too many calls or letters.
If you took out a mortgage before 31st October 2004 and you think you are being treated unfairly by a lender, you can complain to The Financial Ombudsman Service (0845 080 1800). If you took out a mortgage after this date, then FSA rules apply and it is best to contact them directly (0845 606 1234).
Help towards paying your mortgage
If you need help towards paying your mortgage then there are a number of options you can consider.
* Check that you are not entitled to income support, child benefit, pension credit, jobseekers allowance, working tax credit or child tax credit. Contact your local Department for Work and Pensions office or local advice centre for more information.
* Check to see if your mortgage has payment protection insurance. If it has but you are still refused this contact the national debt helpline.
* Check to see if your lender will buy your home and rent it back to you (these are pretty rare and known as mortgage rescue schemes).
* Check rent back schemes by private companies as they can buy your home and rent it back to you (similar to the mortgage rescue schemes). They can often offer you the option to buy back your home at a later date when you have overcome any debt problems. Please check below for links to one such specialist company.
Arranging to pay off the arrears.
Do not arrange to borrow more money to pay off your existing debts as this will make matters worse in the long term. Switching all loans to a cheaper interest rate may be a sensible solution but increasing your debts is not.
In order to pay off arrears on secured loans you will usually have to pay extra monthly amounts to your lender. Lenders will sometimes ask for the arrears to be cleared over 12 to 24 months. Ask for a longer time to pay the arrears if you cannot afford to do this. If you cannot manage to clear the arrears as quickly as your lender wants, start paying the amount you have offered anyway and explain why you can only afford this, particularly if there are special circumstances (i.e. long-term illness, birth of a child, relationship breakdown or unemployment).
Other options to consider
* Change from an endowment mortgage to repayment/interest only mortgage
* Change from repayment mortgage to interest only to reduce monthly payments.
* Try and move onto a cheaper rate with your existing lender or move to a different lender.
What if I still can not afford my mortgage or arrears payments?
* Look for ways to increase your income (i.e. by renting out a room in the property) or reduce your other outgoings.
* Sell and rent back your home from a specialist rent back firm. Often the rent charged is less than previous mortgage payments.
* Sell your home and move to a cheaper home that you can afford.
What if they threaten to evict me?
If you have been given a court order (via the post) you will normally have 28 days notice of the hearing date. This court order does not mean you will be evicted on the date of the court hearing. This is just so the court can hear the case for and against your eviction. In order to understand the court hearing and preparation required we suggest you contact your local citizens advice bureau or national debt helpline.
Being in mortgage arrears is an incredibly difficult time for those experiencing them but it is very important to take action at the first instance of arrears. Unfortunately, many people get evicted unnecessarily by ignoring their lenders threats due to the stress of facing up to the situation.
Real Estate Professionals
Feb
05
Child support affecting credit for mortgage loan?
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Many years ago when my husband divorced his ex-wife, he was self-empoyed and missed several payments. Four years ago, he filed necessary documentation to have the arrears included with his monthly payments, increasing his payments monthly to include an additional $100. After four years, the Texas Attorney General’s office is showing it outstanding and consistently late. We are trying to purchase our first home but are having trouble getting the financing as his FICO score is reflecting this issue. What can we do to get around this issue and get approved? We have documentation that shows he is current on child support and current on the agreement to pay arrears.
Rent Back
Feb
02
Remortgage Quote: Helps you to Secure Cheaper Mortgage
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Rising house prices have given homeowners significant gains in wealth. Remortgaging refers to change in mortgage policy though. This is done with your existing provider or to a different mortgage provider. It involves basic fact by switching your mortgage from your existing lender to a new mortgage lender. If you are one of those who are looking for equity release, finance home improvement, debt consolidation, clear off mortgage arrears, stop a house repossession with an existing mortgage lender or just remortgage to raise money for any purpose or simply remortgage to reduce your monthly payments, you can enjoy cheap remortgage. For all, you need to take out Remortgage Quote for securing cheaper deal.
With the help of different quotes, you are able to find a cost-effective remortgage deal. There are some remortgage deals which are offered on zero fees for making the transition. If you have a fairly smaller amount to remortgage, it is best for you to choose a deal with a low fee. It helps you compare interest rate of as many remortgage lenders as possible. Through these quotes you can have good chances to access specific lenders who have a suitable remortgage package for your requirements. Finally, it assists you commanding your financial position by comparing different lenders for choosing the rate which is best suited to your status.
Importantly, those who are labeled with bad credit can take out best benefits of these quotes. Though generally these quotes cost higher to those having serious credit problems, yet a good of their searches can secure a lower rate business. Such a borrower is more in need of taking these quotes at lower interest rate for reducing the outgo of the money.
There are innumerable lenders fiercely giving competition to one another for their lending businesses. You are required to fill out a simple application. With that do give detail about current mortgage and of course the expectation from remortgage. Thereafter, a list of lending options is provided to you. You can contact these lenders through online. These lenders provide their services round the clock. It saves your time and energy.
Quick House Sale
Jan
30
Credit reference agencies and mortgage application. UK?
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I have obtained my credit file from Experian which is pretty good, no defaults, arrears, ccj’s etc, I’ve also had the one from equifax which is not good at all and also links me to an associate with bad credit. I applied for a mortgage online with a building society who I have been informed uses only Experian, I have the AIP and have now submitted a full application which has also been approved subject to valuation and electronic identity check. Will they use equifax as well as experian for the identity check, is this how it’s done? They have also asked for my ni number do they use it and if so what for?
I just found the following information attached to my application so I think it may well answer my question. The building society use Experian and in the info below it says agency not agencies, so fingers crossed.
We will attempt to electronically verify your identity and address for Anti Money Laundering purposes, through a credit reference agency on submission of a full application only. If we are unable to obtain this information we will ask you to provide us with identity and address verification.
Peter P
You are exactly right! I do have something to hide, as I stated in the question there is an asscociate linked to me on my eqifax report with very bad credit and this would more than likely affect my application.
Thanks for you’re intelligent reply!
Passive Income
Jan
30
Re-mortgaging the Answer to Debt Problems?
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We live in a world where credit cards, overdrafts and loans make spending effortless. Online shopping brings the high street into your home and every newspaper you read offers bigger and better deals on consumer items. In this situation, it is very easy to overspend and managing your personal finance can quickly become a nightmare if debt takes a grip on your life.
One solution, available to homeowners in debt, is to re-mortgage their property and release some of the equity held in their house. This is actually a very straightforward process and, in many cases, can be completed in around two to three weeks.
Re-mortgaging can reduce outgoings, consolidate existing debts or even raise additional cash for ongoing projects. To start the ball rolling you first need to find a good Financial Advisor who can help you choose your best course of action.
Finding a good financial consultant can be tricky, but if you look out for a independent consultancy which employs advisors who have completed the relevant CeMap (Certificate in Mortgage Advice and Practice) qualifications then you won’t go too far wrong. This national qualification covers UK financial regulations and specialist mortgage knowledge and the advisor will have been thoroughly tested on their ability to give appropriate mortgage advice.
Personal finance is a sensitive subject for many people so financial advisors often visit people in their homes. A good advisor will be able to help you gain a thorough understanding of your financial situation and if a re-mortgage is the best option for you then they will be able to complete all the paperwork on your behalf.
The first step is to find out if you qualify for a re-mortgage. Your financial consultant will begin by asking you some searching questions about your financial situation. If you are worried and upset by debt then these questions may seem an imposition but rest assured, the consultant is just doing their job.
All mortgage lenders will need up to date information about you and your circumstances before they will even consider a loan. However, if you deal with a reputable advisor then this information will remain completely confidential as the Data Protection Act specifically prevents the sharing of personal information without the subject’s knowledge.
Re-mortgaging is subject to the usual ‘terms and conditions’ but these will be explained in depth by your financial consultant. Providing the re-mortgage is carried out with a reputable lender these terms and conditions simply protect both borrower and lender.
A poor credit rating can sometimes be a cause for concern but it may not be a barrier to re-mortgaging. It is true that County Court judgements, payment defaults, mortgage arrears or a poor credit history can seem like insurmountable barriers but there are financial consultancies which specialise in helping people with a record of bad debt. They recognise and understand all the problems and can usually offer a range of workable solutions.
Possibly the most important thing to remember is that a good financial consultant should have the facility to ask all the UK lenders for their most competitive interest rates. Obviously rates will be based on your personal circumstances but it shouldn’t take long to discover the very best option for you.
Why not explore the potential for re-mortgaging today - it could make a lot of sense!
Quick House Sale
Jan
27
How a Mortgage Broker Can Help you
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A home loan is probably the largest debt that an individual or a couple have in their lifetime. Small differences in the details of the loan, such as the interest rate, can make a big difference to the cost over a long period.
Buying a home in London can be a very expensive business. Many workers cannot afford to live there on the wages they earn. For most people the services of a mortgage broker in London are crucial.
A London mortgage broker will represents dozens of lenders and probably has access to thousands of mortgage products. A mortgage broker can customise a loan to the specific needs of a borrower and, unlike a provider you would find in a High Street, is not tied to a particular line of products or set of constraints. A broker can also help negotiate terms that will be more favourable to the borrower than the latter could get directly from a lender. As a mortgage broker in London will do most of the work that a direct lender would do, the broker can get a reduced ‘wholesale’ rate from the lender, which will benefit the borrower.
If a loan is declined by the first lender of choice, then it is simple and emotional for the mortgage broker to repackage and submit the loan to another lender in only a couple of days.
So, if you are a first-time buyer looking around for a mortgage in London or if you have taken out a number of mortgages before, your best bet is to contact a London mortgage broker who will help you find the mortgage that best fits your personal circumstances.
Mortgage brokers will not advertise headline grabbing interest rates, because they have no idea what mortgage rate they will be able to get for their customers. Indeed High Street banks who advertise low mortgage interest rates really don’t know what the rate will be for a customer until all circumstances are known. The difference is that a big bank will advertise a low rate, but will actually have only a limited range of mortgages available, compared with a mortgage broker.
If you are remortgaging in the capital you would also be well advised to look for a London mortgage broker. When you move your home loan to a new lender, but you’re staying in the same property, with a mortgage broker you could reduce your monthly payments, consolidate other loans into your mortgage to give you one payment which is less than the sum of the previous loans. With a remortgage you should be able to clear mortgage arrears on your property and avoid repossession if things are tight. Another reason for remortgaging is to release equity in a property you already own, maybe to pay for an extension or start a business of your own.
There are some potential pitfalls, and a mortgage broker in london would help you avoid these. For example, any savings you make on the interest rate may get partially or wholly eaten up by the transaction charges associated with moving your loan. Your old and new lenders may also demand redemption fees or reservation fees. The new lender will need to value the property, so there will also be surveyors fees, not to mention some conveyancing.
A mortgage broker can take the burden of this work away from you.
Quick House Sale
Jan
24
CSA Back payments arrears / Assessment calculations help?
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I am a 44 year old male with 2 children from my previous marriage the children are 18 yrs old and 15 yrs old.
I have a 25% equity share in the matrimonial home which is payable when my youngest turns 18 yrs old.
I had accrued some arrears several years back and the CSA had agreed a monthly payment of around £60 per month on top of the normal maintenance payment. In all I have been paying £370 per month including arrears, I have just been re-assessed and the payments are going up to £550 per month, partly because I have been reassessed and my wages have gone up slightly (pitty they don’t reduce them when the cost of living goes up) And secondly because my arrears now have to be paid within a set period, which has taken it up by another £30 per week.
This has put me in an impossible situation, I am on the old system ie. 30% less certain expenses like my mortgage. I have since re-married but my wife as strange as it seem will not move in as she refuses to have anything financially to do with my children.
So heres the question…. can they ramp up my payments without any regard to my financial commitments?
My take home pay is £1850 monthly I have an £800 mortgage, council tax £100 per month + every day living costs, I have been accessed at £86 per week if I took out a pension (which at the moment I havent got one) would that reduce my maintenance payments?
Passive Income
Jan
22
Mortgage and Financial Knowledge is Power
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The CeMAP Grp Online Training (www.cemap-grp.co.uk) is a teaching resource for the Certificate in Mortgage Advice and Practice (CeMAP), which is essential to qualify as a mortgage adviser. This course has been designed for those who want to pursue a career in mortgage advising, or even for those who just want knowledge of the vast mortgage and financial markets.
Why do the CeMAP? In the current economical climate the media is reporting daily on what is going on in our banking systems, lending provisions and how the Monetary policy, Fiscal policy and other legislation are being adjusted to ‘get banks lending’. But do you understand what is being said? The economy affects us all on a personal and daily level, however the understanding in the public about what is going on is lacking. Therefore, by educating ourselves we can have a positive impact on our own lives and use the knowledge to help our own finance. And remember, the economy is a cycle and it will go up, therefore nows the time to get the knowledge.
We at the CeMAP Grp will support you to further your knowledge and complete the course. Moreover, you could start your career as an employed or self-employed mortgage adviser with the potential to earning £100,000+.
The course material has been designed by a fully qualified CeMAP trainer who has created the resources to be simple and easy to understand. Therefore, you do not need any prior knowledge of the financial and mortgage markets, as it is all explained. Using diagrams, mind-mapping techniques, highlighting of important information and removing the unrequired information, CeMAP Grp will help you gain and retain the information in a fast and efficient manner, so you can start your mortgage career.
Once you have signed up you will have unlimited access to the online resources, including notes and FREE access to the advice and help contact center, where you can ask a fully qualified CeMAP trainer your questions. Furthermore, we will send you a hardcopy of the notes so you can add your own information and study anywhere. The CeMAP Grp Online Training provides unlimited access which allows you to work at your own pace, around your current commitments, and with no time constraints or pressure to complete the course within a certain amount of time.
The CeMAP Grp online training program covers the full CeMAP course:
CeMAP 1: UK Financial Regulation
Unit 1: Introduction to Financial Services Environment and Products
The UK financial services industry
Financial assets
Financial products
The financial planning and advice process
The main areas of financial advice
Basic legal concepts relevant to financial service
Unit 2: UK Financial Services and Regulation
The Financial Services Authority
Money Laundering
Complaints and compensation
Data protection
Other laws and regulations relevant to advising clients
CeMAP 2: Mortgages
Unit 3: Mortgage Law, Policy Practice and Markets
Borrowers
Mortgage and property regulation and law
The house-buying process
From offer of advance to completion
The economic and regulatory context of mortgage advice
Unit 4: Mortgage Applications
The role of a Mortgage Adviser
Assessment of status
Assessment of security
Guarantees and additional security
Unit 5: Mortgage Payment Methods and Products
Mortgage repayment methods
Mortgage products and schemes
Other mortgage-related products
Unit 6: Mortgage Arrears and Post Completion
Further advances and remortgaging
Arrears, debt management and recovery
Other post-completion matters
CeMAP 3: Assessment of Mortgage Advice Knowledge
Case Study Based
On completion of this course you will have an understanding of the economy, mortgages, the FTSE100 and shares, insurances and securities, current legislation and much more. Thus this knowledge will help you in your everyday life, whether you pursue a mortgage career or not.
If you sign up now for the full CeMAP course with CeMAP Grp Online Training, you will receive a 10% discount. Making NOW the best time to join us and the hundreds of others to make your £100,000+, expand your knowledge and start your new career.
Furthermore, by becoming an affiliate for the CeMAP Grp and recommending the course to five others, we will give you a massive £250. To become an affiliate just sign up, complete your details, and we will send you your own personal affiliate code.
Sign up with CeMAP Grp, www.cemap-grp.co.uk, now to change your life!
CeMAP Grp Ltd
info@cemap-grp.co.uk
Repossession
Jan
21
The house was surrendered the house due to arrears, but only a few days ago. I now want to re-buy the house for my friend then sell it to get the equity out of the house and return the difference to the friend. Buying the house for me is not an option, neither is a family loan, they never work. The house was a council house which they now own.
Q1. Would a mortgage company refund the difference to the owner if/when the house sells for more?
Q2. Would the mortgage company allow us to pack back the arrears, now?
Q3.Is there a time limit to sell an ex-council property and not have to pay something to the council?
Help please… got to get this sorted and get the max equity out for the friend.
Sell House Quick
