I hope someone here will be able to help me understand what my position is regarding my house. My husband has just received a shortfall demand letter for a previous property, which thanks to the excellent information on this site, is not scaring me as much as it did when I first saw it. However it has opened a whole new can of worms... Firstly, I knew nothing at all about this property, since when we took the mortgage out on the house we now live in, he told me he had never had a mortgage before. This means that he must (probably) have lied on our application form - is this fraud? and if so, how will it affect me? (we have had the mortgage for 5 years, everything is up to date). Secondly, he is being very cagey about how long ago this house was re-possessed, firstly telling me it was 'about 18 years ago' (fine, not a problem) then saying it was '11 or 12 years ago' (very different story). The local CAB seem quite genned-up, but say they can only give him help/advice if he will go there with some evidence of when this all happened - he says he has none (says it was a voluntary repossession, with no arrears). If it is within 12 years and he does nothing, assuming the case was a good one and eventually went to court, would it affect our present mortgage? Strangly, on going to check the conditions of my mortgage agreement, I can't find any paperwork relating to the mortgage. I know I had some things, but not which things - and I never throw anything away. Apart from this mystery, can I contact my current lender to ask for copies of whatever I should have without raising alarm bells?

Sorry if this is a bit long-winded, I'll help keep it shorter by not sharing with you all my present opinion of my husband...

Any help or advice would be gratefully received - I'm obviously a lot more naive than I thought...

-- Arabella (ArabellaBreson312@hotmail.com), October 11, 2002

Answers

Hi there Arabella,

First off, regarding the application form, yes it could be construed as fraud, however, as you are uptodate with your present mortgage, it would be unlikely that the lender will be concerned and unless they are informed, they will be none the wiser!

Even if you go into arrears and repossession proceedings take place then this fraud issue will not be noticed under current lender repossession processes.

Also if your present lender had underwritten your application form correctly they would have been aware of your husbands past repossession, as most repossessions are registered on a registar for 12 years. It may be that your present lender is a sub prime lender who knew about the past repossession and increased your interest rate to reflect this additional risk.

Your present mortgage would not be affected if this previous lender issued court proceedings unless the lender attempted to bankrupt you. Most lenders state in their terms and conditions if a borrower is made bankrupt they may 'call the mortgage in'.

If your past lender does try to do this then if the CAB are unwilling to help contact the NAMV (see this site).

Finally, I doubt that your lender would raise alarm bells if you write to them asking for copies of: -

Mortgage offer Terms and conditions Application form

Most lenders will oblige with a simple request, however, some padantic lenders may request you send them a SARN, try writing to them first and issue a SARN (see other sections of this site) if they are non complying after 3 weeks.

Best of luck.

Paul

-- Paul Adamson (paul.adamson@btclick.com), October 11, 2002.

Paul,

Thanks for the wealth of info here! Esp. the bit about not becoming a bankrupt - the CAB had suggested to me that it MIGHT be an option for my husband should things get sticky. Thanks also for telling me what it is that's missing from my paperwork!

Arabella

-- Arabella (ArabellaBreson312@hotmail.com), October 12, 2002.