One of the most common solutions we offer to our clients at Negative Equity NI is a negotiated settlement with their lender. With a debt write down, also known as a shortfall sale or an informal arrangement, the borrower typically sells the property and we will negotiate with the lender to write off as much of the remaining mortgage debt as possible, with our client paying an agreed, affordable sum.
Sometimes we find new clients are sceptical about this approach and wonder why a bank would ever consider writing off any of their mortgage debt, but there are good reasons why a bank would agree to this.
They don’t want to repossess the property.
Banks don’t want to repossess your property if you can’t meet your mortgage repayments. Repossessing a house leaves the bank in possession of an empty property they have no use for and repossessed properties typically sell for around 20% less than their true market value.
They don’t want to go to court.
If you’ve been struggling for some time to meet your mortgage repayments and you’ve fallen into arrears, there’s a good chance you’ve received letters from your lender or their solicitors warning that they could take you to court, but this isn’t something banks really want to do if they can avoid it, mainly because it costs them money.
It leaves them with other costs.
Banks are in the business of lending money, not buying and selling properties, that’s what estate agents are for. So, if your lender repossesses your home they have to pay someone else to sell the property on, usually at auction for significantly less than their market value, meaning the bank doesn’t losses money on the sale and on getting someone to handle it.
There are rules for repossessing a home.
If a bank decides that it wants to repossess a home it isn’t as simple as just taking back the keys. They have a duty of care to the people they have lent money to and there is a process they have to follow if they want to repossess a borrower’s property. If a lender fails to follow the rules the court could delay the repossession, order the bank to pay your legal costs or stop them from adding their own costs onto the money you owe them.
For all of these reasons, banks much prefer to reach an agreed settlement that works for all parties and that’s where Negative Equity NI comes in. We have successfully negotiated hundreds of cases every year where we have arranged the sale of our clients’ homes and reached an affordable debt settlement with the lender to write off unaffordable mortgage debt.
Whatever your circumstances, the first step to dealing with your property debt is to contact Negative Equity NI for an initial free, no obligation consultation with one of our advisors.
Take a look at our reviews and call us on 028 9018 3223 or go to our website and arrange for us to call you at a time that suits you.