What happens to sale monies after re-possession

[billypre]

Sorry if in wrong category. I just want to know if any of you have an idea of what exactly happens when a repossession occurs ? I had my home repossessed 7 years ago. I never received any statements or notice of what happened, probably due to the fact that none of the companies had my new address as i was homeless for a spell and moved from home to home. I had a secured loan with one company, and also my mortgage with a small loan attached.

[di30]

Re: What happens to sale monies after re-possession

Hi Billy

Sorry for not seeing this one sooner.
Not sure if the below information will be of any help to you.

http://www.hip-consultant.co.uk/blog...-ins-outs-123/

What Happens if There is Money Left Over After a Repossession Sale?

If the sale price achieved is enough to settle the mortgage debt in full and there is money left over the lender will instruct its solicitors to distribute this surplus to whoever is entitled to receive it. If there are other debts secured on the property then it will be passed to the next creditor in line, usually the one whose interest was registered on the earliest date. If there are no other debts then the proceeds will be paid to you. You will need to provide the solicitors with identification documents and you’ll need to have a bank account in your own name. You’ll normally need to sign a receipt.
Where the proceeds are paid to a creditor the whole surplus proceeds will be paid to them regardless of what they are actually owed. If, after taking what is owed to them, there is still money left over it will be their responsibility to pass it on to the next in line.
If the person or organisation which appears to be entitled to the surplus proceeds cannot be traced, or if it is unclear who is next in line, the solicitors may choose to pay the money into the Court Funds Office, where it will be held until someone makes a valid claim on it. That claim must be made to the County Court and will be heard by a judge.

[PlanB]

Re: What happens to sale monies after re-possession

Sorry if in wrong category. I just want to know if any of you have an idea of what exactly happens when a repossession occurs ? I had my home repossessed 7 years ago. I never received any statements or notice of what happened, probably due to the fact that none of the companies had my new address as i was homeless for a spell and moved from home to home. I had a secured loan with one company, and also my mortgage with a small loan attached.

I've only just seen this. Do you know whether your home was in negative equity when it was sold because that would make all the difference to what would have happened to the money from the sale? You can check exactly what the lender sold it for on www.nethouseprices.com This website is FREE to use and logs all sales from 1999 onwards so just enter your postcode and voila. It's information is based on Land Registry data so it's reliable.

Then if you have your last mortgage statement you can subtract that from the sale price and see if there was likely to be anything leftover. Alas the bank will also have lawfully charged you for the cost of the sale (usually auction fees), any early redemption charges and its solicitor's legal fees on top so the bill would have been greater than the oustanding mortgage per se.

The lender's solicitor would then have had a legal duty to discharge any other Land Registry charges such as the secured loan.

After all that if there was anything left then this would/should have been sent to you by cheque from the lender.

When you've done the maths if you think there would have been a shortfall then I would keep quiet. The lender has the right to pursue you for the shortfall for up to six years after the repossession plus interest, sadly it's not over when the keys go back Since you say you were repossessed seven years ago you may (and I stress may) be in the clear, but double-check your dates. The property may have been repossessed seven years ago, but not sold immediately. Some lenders leave properties unsold on their books for another year so it may be touch-and-go on the dates.

If you think you may have been in significant profit then contact the original mortgage company for a statement etc etc. However if you had a solicitor at the time of the repossession it may be wiser to ask them to dig their file out of the archives to see what's in there first. If you were owed money from the sale then I would expect you are also due interest on that.

Hope this helps

[billypre]

Re: What happens to sale monies after re-possession

I ended with a shortfall of about £70

[PlanB]

Re: What happens to sale monies after re-possession

I ended with a shortfall of about £70

Was that after paying off the secured loans? Even if it wasn't I'm sure one of the mods on here will tell you if they are now SB. Let's hope so

Mind you I'm a stubborn old fool and I would want to know whether the lender achieved the best possible price for the property at the time. There are rules which state that they have to obtain at least two independant valuations and market the property in a newspaper etc. If you suspect they didn't do that and your home was sold for well below market value then you would have a case against them. But you would need to be talking a discrepancy of £1,000s because the legal fees for pursuing this would probably eat up any profit you may win

[PlanB]

Re: What happens to sale monies after re-possession

I completely agree about the 1st charge (i.e. the mortgage) but BP's secured loans should be SB after 6 years, no?

[PlanB]

Re: What happens to sale monies after re-possession

Blimey. That's another damn good reason to campaign against creditors being permitted to get COs on a property for a poxy sum owed on a credit card. Call me paranoid but do you think this is why creditors go for COs because it extends their chase period from 6 years to 12 years

[PlanB]

Re: What happens to sale monies after re-possession

Well, once they get a CO then there's no limitation period, is there? The charge stays in place till the property is sold or remortgaged.

In my experience most people wrongly think that when a property is sold with a shortfall they can just walk away from any outstanding debt relating to the charges which have been on it except the "mortgage". If the creditor can pursue these debts (which were, as you rightly say, initially lent as unsecured with higher APRs to reflect the perceived greater risk) for another 12 twelve years then there's an obvious motivation for them to get a CO to bypass SB even if it's only for a miserable £1,200