What to do if you have a mortgage shortfall

What to do if you have a mortgage shortfall

A mortgage shortfall can occur in any number of ways. I usually find with my clients that it is as a result of a partnership break up. In the majority of cases people will buy a property together utilising both incomes and they will have had little if any spare money left over after the mortgage payments and general living costs.

It is struggle enough sometimes just to pay the mortgage but that is what it cost to get on the housing ladder and own your own property. Also lets be honest, when property prices were rising nobody cared about the mortgage as the house was always going to be worth more than the mortgage owing, so in bad times the house could be sold.

Where are we now? Property is almost impossible to buy as it is very difficult to get a mortgage. There are properties out there in the market place and they are good value.

Actually you may be reading this because yours is one of those properties. I have spoken to dozens of people in the last year who have had a relationship end, and then find themselves unable to pay a mortgage on a jointly owned house whose repayments were based on two incomes. One party will struggle for a while to keep up repayments and then see that it is impossible.

Repayments cease and eventually the keys are handed back in or the house formally repossessed. In due course the mortgage company will sell the property and there is likely to be a mortgage shortfall. In essence this is the difference between the amount due on the mortgage together with interest and costs less the price achieved at sale. I have seen instances recently of mortgage shortfalls of between 50,000 and 100,000.

I have taken a number of my clients through bankruptcy as a result of this. They have a mortgage shortfall and have spoken to the lender who has demanded repayment. This is obviously impossible. However the lender has rights to chase that debt for 12 years. In the majority of cases they will not due so past 6 years, but that is a long time with such a huge debt weighing you down.

I can deal with mortgage shortfall debt in as little as a week. You can be debt free and get on with your life again. Your credit rating is already wrecked due to the repossession, so the bankruptcy will not make matters worse. Getting rid of this debt can only have positive implications.

POST COMMENT

What Makes A VA Loan Different Give Your SME A Deserved Boost By Taking Advantage Of A Commercial Mortgage Veterans Administration Loan Scheme Attractive Refinancing Options Through VA Loans VA Loan - Option For Refinancing Important Information About VA Loans VA Refinance Loan Veterans Administration Loan For Military Personnel RRRL - Rate Reduction Refinancing Loan VA Loan Refinance Option 4 Factors To Search For To Consolidate My Student Loans Great Benefits Of VA Loans Loan Program for the Veterans