Negative-Equity-Arrears-and-Charges
Negative-Equity-Arrears-and-Charges

 Negative Equity, Arrears and Charges

Negative Equity, Arrears and Charges

| The Problem: Negative Equity, In Arrears

This case concerns a customer who approached NENI with an outstanding mortgage of £190,000 whilst also building up £24,000 in arrears and charges. The customer needed to move from their property but after the housing crash their home was now only worth approximately £80,000. This meant it was £110,000 in negative equity.

| The Solution

The Negative Equity NI team helped by selling the house via a local estate agent for £80,000. As a result of Negative Equity NI negotiating with the lender, we managed to get a deal where they would write offthe remaining debt of £129,000. A lump sum payment of £5,000 (6.7% of the total debt written off!) was made by our client to the lender in order to settle the case.This now means our delighted client has now moved on with their life and can be sure that this is now a problem of the past.

How is home equity calculated?

Home equity is calculated by subtracting the amount you still owe on your mortgage from the current market value of your home.

Can you have negative equity?

Yes. With standard loans, your home equity will increase over time. With negative-amortizing loans — a loan with monthly payments less than the interest rates — your equity decreases over time as your owed balance increases.

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