During the height of the property boom I bought a terraced property for #28000 (100% endowment mortgage) along with my then fiance. After a few years the mortgage account fell into arrears my relationship broke up, she left the property and has never helped towards mortgage repayments. I left the property with the intention of selling it. When I had a valuation done the property was only worth #22,000. My mortgage account stood at #32,000. I thought I had sold the property but the mortgage providers Nationwide refused to give me a loan to cover the shortfall. I have been forced to rent the property to cover mortgage payments and as a result have ended up with the tenants from hell. The tenant has not paid any rent since July 00 resulting in me not being able to afford the mortgage payments. I am some 3 months into arrears again with my mortgage and cannot afford to pay it as I am now married with kids and have an other mortgage in joint names with my wife. It is only a matter of time before Nationwide come after me. I am worried that they will try to come after any equity in my current home to claw back some of the shortfall. Does anyone know if they are entitled to do this. Also will they go after my x fiance to try to get some of the shortfall back of her. I have been saddled with a property I never wanted in the first place and have struggled for 7 years to meet mortgage payments. Can anyone offer any advice on what I should do next.

-- Helen Cook (helencook@x-stream.co.uk), September 30, 2000

Answers

You can sell the property for less than you owe. You will almost certainly need to get a solicitor to advise you on the ins and outs of ensuring this in the face of Nationwide's opposition.

A warning to any homebuyers that read this: this kind of lender obstruciton is a perfect example of why you should not take out a mortgage with Nationwide.

The courts ruled some years ago that lenders were in the wrong to repossess properties where the customer had a reasonable chance of selling it for close to - but less than - the amount owed. Provided, that is, the customer could show how they intended to pay off the unsecured debt that would remain.

I can't remember the name of the case(s) that established this, so if anyone can, please post it as a response to this posting.

Lee

-- Lee (repossession@bigfoot.com), September 30, 2000.

The case you're referring to Lee was with the Halifax. I can't remember the name of the borrower, and I can't find the info in my archives.

However, the name of the solicitors acting for the borrower were Messrs. Meredith Smith & Pratt @ Tonbridge in Kent, tel : 01732- 773288.

I also believe that there is no need to provide any surety for the shortfall ??

All the best. Vic

-- Vic Harper (victorcharper@aol.com), September 30, 2000.