Archive for mortgage arrears
May
06
I too would like to know if I can get a 100% mortgage?
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I would like to buy my council flat as I will get 50% discount and, as I live in north Scotland, property’s are still relatively cheap. ( Full price I think would be no more than £30.000) However, I will need a 100% mortgage as I am a poor admin assistant for the health service. I have made an apppintment with the Halifax as I am currently Bank of Scotland. I have about £1,800 of debt and am also paying off council tax arrears, which I lknow have to be clear before I buy ( I may have to borrow to pay this). I would also like to borrow for home improvements but I think the council have to agree to these. Where’s the best place for a mortgage or any other advice gladly accepted.
Sell and Rent Back
May
04
FSA Reports a 31% Surge in Mortgage Arrears
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According to a recently published article by the Financial Services Authority (FSA) on the latest mortgage lending statistic they reported a sharp surge in mortgage arrears. With borrowers continuing to struggle to clear their mortgage arrears, the numbers of arrears have been progressively increasing since the beginning of 2007. By the end of 2008 there were 377,000 mortgage accounts in arrears, which is an increase of 36,000 accounts. This is an increase of 31% on the previous year.
The FSA report comes in light of a recent survey of 1,407 new debt clients conducted by the Citizens Advice Bureaux (CAB). They found the average amount of debt owed by their clients’ was £16,971 in 2008 and one client in ten had ten or more credit card debts. More than 50% of these clients had four or more priority debts like their rent or mortgage, rent, electricity, gas, water or council tax arrears. The Citizens Advice Bureaux discovered that a third of these people spent more than half of their monthly income on housing costs and forty five percent of them had mortgage and secured loans that were in arrears.
So what can you do if you find yourself struggling to clear your debts? If you’re struggling with mortgage arrears, paying your mortgage, credit card bills and loan commitments. Then you will need to seriously speak to a professional debt advisor that is qualified to talk about debt and the various solutions available. You need to speak to someone who offers free and impartial help and advice. It is important that they assess your needs and they are able to explain the different types of debt solutions like Debt Consolidation, Debt Management plans, Individual Voluntary Arrangement (IVA) or Bankruptcy. Ask as many questions as you need to you need to feel satisfied and you need to really understand what you are doing and the consequences. Below is a quick explanation of the four types of debt help you can find:
Debt Consolidation
This is only possible if you are a homeowner and you have sufficient equity in your home. You can consolidate some or all of your debt into a secured homeowner loan. You must think carefully before securing other unsecured debts against your home. Your home may be repossessed if you do not keep up your repayments on your mortgage
Debt Management Plan
This is a great way of getting your debts under control and it helps to protect your home. Debt Consultants are able to negotiate with your creditors (those people you owe money to) and in most cases they are able to have the interest on your unsecured debts (credit cards, loans) frozen to help you pay off your debts faster.
Individual Voluntary Arrangement (IVA)
IVA help is available to most people with debts of more than £15,000 and no way of paying the debts off. This kind of arrangement is a legally binding arrangement and you can be debt free within 5 years and it helps to protect your home so you do not lose it.
Bankruptcy
This is a solution of last resort and should only be considered for serious debt problems when there is no other financial solution. Bankruptcy does protect you from your creditors and it allows you to start again.
Think carefully about the advice you are being offered and if you are not happy with the advice you are receiving find a second and even a third opinion. There is a growing number of debt advice websites that are providing questionable debt advice so you do need to carry out your own due diligence.
Quick Property Sale
May
01
Caution With Mortgage Rescue Firms
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Home owners who are struggling to keep up with their mortgage repayments are being hounded by so-called “mortgage rescue firms” who promise to save potential evictees from home repossession.
The cost of borrowing has increased considerably over the past year due to rising interest rates. Previously low mortgage repayments have increased significantly for some home owners, particularly if their mortgage contains a variable interest rate or a discount rate period that has expired.
The increase in monthly mortgage repayments has lead to a rapid rise in mortgage arrears and possession orders. Home owners who are facing repossession and eviction have become easy targets for mortgage rescue firms who promise to stop the repossession process and help the home owners to stay on their properties as tenants.
Mortgage rescue firms come in various forms – from large, national firms to small companies operating as sole traders in local areas. The mortgage rescue firm will typically offer the distressed home owner a heavily discounted price for their property and allow them to remain in the property as a rent paying tenant.
The amount of money offered for the properties varies considerably. It will usually depend on how much money the distressed home owner owes on their mortgage balance plus any arrears that have accumulated.
This amount can sometimes be less than half the value of the property on the open market.
While this may seem unreasonable, the point of the exercise is to rescue the property owner from repossession and many years of financial hardship. For many individuals, this offer is attractive enough to accept, despite the fact they will lose thousands of pounds of equity in their home.
Normally, the mortgage rescue firm will allow the occupant to remain in the property as a rent paying tenant. Unfortunately for many people who accept the offer, they fail to realise that they have no legal recourse to remain in the property long-term. Instead, they will become a rent paying tenant on an assured short hold tenancy agreement, and when the term expires they can be evicted.
This is the part of the deal that property owners who are in financial distress need to be aware of. While the repossession process may be stopped and the home owner is allowed to remain in the property for a short time, the mortgage rescue firm has no obligation to allow the tenant to remain in the property over the long term.
Quick Property Sale
Apr
30
Adverse Bad Credit Loan Mortgage
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Contrary to popular belief, there is no such thing as a “credit blacklist”. If you have a particularly bad credit score you might find yourself being rejected for a mortgage from a high street bank, however, each lender has their own methodology, procedures and lending criteria meaning one might turn you down, while another ones, which quantity is growing nowadays, and they will accept your application. Adverse credit history can mean a little more legwork to get an approval for a mortgage loan, and especially to get a decent interest rate. With more lenders in the adverse credit market the competition has helped to create better opportunities for people to get a good deal based on their circumstances. With hundreds of deals to choose from we recommend that you get advice on your mortgage options.
The research is out and it shows that demand for an adverse bad credit mortgage loan is high in the 30 to 50 age group. People in this age group are much more likely to have experienced a life changing event that can adversely affect their finances. This might be why they need an adverse bad credit loan mortgage. Also research showed that the adverse market was estimated to be worth £25bn in 2006 and is expected to grow in the next few years, mainly due to unprecedented levels of consumer debt. More and more people are likely to have tainted credit records due to increasing amounts of arrears, CCJs and the increasing use of IVAs and bankruptcy proceedings. Levels of consumer debt through credit cards, loans and store cards are at record levels. The Office of National Statistics claims the average person is £5,330 in debt – an increase of 50% in five years. Not that adverse credit should be confused with debt. Adverse credit happens when people default on debt repayments.
Adverse or bad credit mortgages has advantages and disadvantages. Although loans are only available up to 75% the mortgage allows even the most unlikely of candidates to get a foothold on the housing ladder. It can make sense to clear debts and get your credit rating back up to scratch before taking on the debt of a mortgage. However the interest rate is not competitive and comes with a three-year tie-in. If in conjunction with shared ownership, you will still need to find 25% of the proportion of the property you are buying as a deposit.
Adverse bad credit loan mortgages lenders offer a range of products to help people with any of the following circumstances raise finance for a property:
People with IVAs or CCJ’s against their name
Someone with mortgage arrears
People who have adverse or bad credit against their name
Borrowers who have been declared bankrupt
People with defaults looking to borrow
The options open to you will depend on whether you fall under the light, medium or heavy adverse classification and what amount of deposit you have available to purchase your home. On the whole, the grimmer your scenario gets the higher your interest rate and deposit required is going to be.
Quick Property Sale
Apr
29
Mortgage Arrears: How to Save Your Home From Foreclosure
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There are many times in life where situations may occur that put a stress on your financial situation. Losing a job, medical emergencies, or family situations may cause you to fall behind on your bills. However, losing your job does not have to mean that you also lose your home. If you have accumulated some mortgage arrears on you home after you lost you job, do not lose heart. There are still some ways that you could save your home from foreclose. Being in contact with your bank and working with them to help you out, is the best thing to start with. To help you stave off foreclosure on your home, here are some ways to handle your mortgage arrears.
Contact Your Bank
There are hundreds of people all over the country that have missed a couple of payment on their home so you are not alone in this predicament. If you think that you will be unable to pay your amortization for a couple of months while you are still trying to find work, it is best to call your bank and tell the loans officers about you change of circumstances. You bank has probably handled this situation before and they know how this go. Banks are not in the business of reposing and foreclosing properties so they will not really jump at the chance of divesting you of your home. Besides, if the bank forecloses your home, it will now have to face the challenge of disposing the property in order to free their capital. Since foreclosing your property will entail more work on he part of the bank than just merely giving you a couple of months grace period, the bank will most likely give you the grace period to pay for your amortization.
When negotiating with the bank for grace period, make sure that you express your strong intention to pay your debts. You should also outline your plan on how you will go about paying your debts and how much time it will take you to do this. If the bank officer will see your strong interest to pay your debts and keep your home, he or she will be more open to the possibility of giving you the extra time that you need.
Leasing Your House
If you cannot pay for the amortization of your home and you have exhausted your grace period, you might want to lease your home for a while. You can use the money that you get from the lease to pay for the amortization. If you have no other place to go, you can just rent a portion of the house. You can move to the basement of the house for a new months and lease the upstairs rooms. Note that if you really want to keep your home, moving to the basement for a few months or so is a small sacrifice that you have to do. Besides, living in the basement of your home is not really that bad. Once you get a nice job, you can always move back to the upstairs room.
Sell and Rent Back
Apr
27
I need some clarification on this matter.
I know mortgage payments are paid in arrears. Meaning the payment due on the first (ex: Jan 1) is actually for mortgage principal and interest accrued on the previous month (ex: Dec).
So for tax purposes, can I deduct the mortgage interest that is reflected on my Jan 1 payment but is NOT reflected on my 1098 that I received from the lender? Basically I believe the amount on the 1098 is short of one month’s interest…
Thanks!
Quick House Sale
Apr
24
Are You Seeking Mortgage Debt Advice?
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Today in the UK there are more people than ever looking for advice on repaying their mortgages. Are these the people who borrowed way beyond their financial means?
January and February this year have seen record breaking numbers of people asking for professional debt advice about their mortgages. Recent figures reveal that more and more people are concearned enough to get help with their mortgage arrears so these are people who already have defaults and arrears, let alone the hundreds and possibly thousands of people who are about to default on their mortgage.
There has been a huge 35 per cent jump in mortgage related debt enquiries in the UK, over January and February 2008 compared to 2007. The good news is that people seem to be learning not to continue spending on credit cards as the credit card related issues fell by 9 per cent.
Of 5.7 million issues dealt with in 2007 almost a third of these enquiries were related to debt; a rather worrying trend. As well as mortgages, the ever increasing energy bills and general household bills are huge contributing factors to the 215,000 new debt related enquires taken this January and February.
The combination of huge increases bills like petrol and diesel prices plus rising housing costs has put additional pressure on day to day finances when they are already stretched to the maximum.
The usual Christmas credit card debt enquiries have fallen by 9 per cent in January and Febraury this year compared to last year, however overdraft enquiries are up 7 per cent on the same time period. So it looks like people are just shifting the debts to other forms of credit, it will be interesting to see the number of debt consolidation loans and general unsecured loans taken out and the number applied for in January, February and when we get to the end of March this year. I bet there are lots of people trying to shift debt to unsecured loans, although the credit crunch has lenders tightening their lending criteria, making it more difficult to get accepted for a new loan.
If you are struggling you should tell whoever you owe the debt to as soon as possible if you’re struggling to make repayments.
Quick House Sale
Apr
24
after mortgage completed when is first payment due?
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my remortgage was completed on the 30/11/07 and they wanted first payment on the 1/12/07 (yep the day after) we were not prepared for that, so that put us a month in arrears, does this sound right, can anyone advise.
Passive Income
Apr
23
How can I sort this Mortgage nightmare out?
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I stupidly agreed to have 3 mortgages in my name for a friend, Let properties for investment purposes. There has ben shortfalls on payments in my account so all accounts have fallen into arrears and there has been LOTS of letters on my doorstep. I managed to get all arrears upto date recently.
Suddenley they are back in arrears. He has agreed to sell 2 properties but it’s taking a while.
The other property i have to make 1 payment to clear arrears then I want to change to interest only. I have to call the company and change to a buy to let product. However I don’t want it in my name anymore. What can I do? Can I sign property over to him via a solicitor? I don’t want anymore letters comign to my house it’s driving me insane.
hope you can help. Thanks
U.K properties.
Sell House Quick
Apr
21
Get Upfront About Mortgage Arrears
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A UK resident with a mortgage arrears problem can get a lot of helpful advice from sites and organizations. If you cannot meet your mortgage payments, if you are in arrears or about to become so, dont play the ostrich head in the sand game.
It is crucial that you immediately contact your lending institution and make them aware of your financial problem.
Every lender has a plan in place for dealing with mortgage arrears and helping you get back on track with your payments. They will try to help if you are proactive and honest with them.
If you try to avoid them, refuse to take their calls and just hide out from your creditors, you will soon be in over your head and may lose your home.
There are also some free not-for-profit organizations in the UK whose mission is to try to help you keep your home and your good credit. They will help if you contact them.
Your mortgage lender should be your very first email or call when you realize you have a mortgage arrears issue. Not only do they want to keep your mortgage in place and in good standing, they are also obligated through federal legislation to take your critical situation into account and treat you in a fair, informative and helpful manner.
As of October 31, 2004, the UK Financial Service Authority (FSA) is in charge of regulating each UK mortgage. The legislation says that you must be kept informed about your current mortgage arrears status. Strict guidelines have been set on how the lender must behave before and during any home repossession attempt.
If you are honest with them, your lender just might be able to come up with a more suitable payment arrangement, at least temporarily until you are financially back on your feet again.
The plan your lender can and will put in place for your mortgage arrears situation depends on your payment history to this point, and whether your financial problem is short or long term.
The possibilities they can offer include reduced payments for a set time period, letting you make interest only payments for a pre-determined time period, a short holiday from any payments at all, or an extension on the term of your mortgage. The latter would result in reducing your payments for the length of the mortgage.
If you have already fallen into arrears with your mortgage the options for your lender to offer are fewer. You can pay off the overdue balance gradually by making larger than scheduled payments each month.
If this is not possible you might be able to delay the extra payments for awhile or just add them to the end of the loan period. What the lender determines to accept will depend a lot on the history of your payments on the mortgage up until your financial difficulties set in.
Whats crucial in a mortgage arrears is that you continue to pay something on the due date, even if the total varies each and every month. Communication is an important key to resolving a mortgage arrears in your best interests and saving your home and your good credit.
Repossession
