22 Mar 2015

A question about : Mortgage arrears fees / remortgaging

Hi there, I posted this on another board earlier but have had no replies so thought I'd try here instead. Apologies for the fact that this is so long, but any advice is gratefully received:

I wonder if you can help. I’ll try to keep this as brief as I can (butit is quite long and complicated, sorry!) My ex-husband and I have a shared ownershipmortgage which was taken out with Preferred Mortgages in 2003. This wastransferred to Capstone and then Acenden which is the company that I pay now.The mortgage is now paid solely by me following my divorce from my ex-husband.The mortgage can’t be transferred to my name only because of course, Acenden nolonger provide mortgages.

Bottom line is that if I’m honest, when we bought our flat, myex-husband and I just couldn’t afford the mortgage and the rent on the sharedownership property. We paid the mortgage on time but we often couldn’t affordthe rent and the terms of our tenancy agreement allowed for the housingassociation to apply to the mortgage company to pay the rent arrears.

This meant that we ended up with mortgage arrears. Ironically despitenever having not paid our mortgage. This became a vicious circle – we couldn’tpay the rent because we were trying to pay off the mortgage arrears so thehousing association applied to the mortgage company to pay the rent etc etc. Weended up with a suspended possession order issued in approximately 2006 or 2007.My husband and I split up at the end of 2008. He left the property and Iremained in it with no financial contribution from him which lead to thevicious circle continuing for a while.

The terms of the suspended possession order state that I am to pay Ј100per month towards the mortgage arrears which has been done since the suspendedpossession order was put in place. I have now, after a lot of hard work,managed to get myself on an even keel where I am able to afford both the rentand the mortgage so that since approximately mid-2009 my rent has not beencharged to the mortgage company.

I noticed recently that the arrears on the mortgage don’t seem to bereducing and I looked through my paperwork only to discover that there is an ‘arrearsmanagement fee’ of Ј70 charged each month during “any month where payment isnot made on time or the account is in arrears”. My mortgage arrears currently stand at Ј6,772.73 with an ‘other charges’amount of Ј4,744.66 outstanding. This totals Ј11,517.39.

I believed that I was paying Ј1,200 per year in order to reduce themortgage arrears (Ј100 per month x 12 months) but it would seem that actually I’veonly been paying Ј360 per year (Ј30 per month x 12 months) with Ј840 per yearbeing paid to Acenden.

At this rate, it will take me 32 years to pay off the mortgage arrears…and my mortgage is only due to run for another 15 years! It will also cost me Ј26,040, if I continue topay Ј840 per year to Acenden for the next 31 years.

My questions are as follows:

1) I am keen to be able to remove my ex-husband’sname from the mortgage and re-mortgage in my own right, however, with the largeamount of mortgage arrears, I think I’m on a hiding to nothing. Is thiscorrect? Does anyone know of a company that may consider a shared ownershipmortgage on this basis? (I suspect a pig is flying past my window). I candemonstrate a very good credit record in the past five years since splitting upfrom my husband. I have a number of credit cards which have been excellentlymaintained, a mobile phone contract for which I have never missed a payment anda excellently maintained catalogue account (set up to demonstrate that I amable to manage my finances appropriately). I have a mainstream bank account(First Direct) with an overdraft facility which is also extremely wellmaintained.

2) My plan for dealing with Acenden originally wasjust to write to them to ask them if they would consider reducing or removingthe arrears management fee but in doing some research into this, I came acrossarticles about reclaiming unfair mortgage fees so I thought I might try this.Has anyone had any success with regard to this? To be honest, I feel a bitguilty about this because Acenden have actually been very helpful in the pastwhen I was going through my divorce and put payment plans in place to help meout, but when I worked out how much I would be paying them and how long itwould take me to pay them back, I feel as though I have to do something becauseotherwise I’ll be stuck with mortgage arrears until I retire!

1) 3) Upon reading various websites, a number ofpeople urge caution in approaching your existing mortgage provider to claimpotentially unfair fees for fear that the mortgage company might tell the customerto take their business elsewhere. Does anyone have any advice about this? Ifthe answer to my first question is that I am unlikely to get a mortgageelsewhere I don’t want to end up homeless!
4) Please don’t think that I don’t want to pay whatI owe. I got myself into this mess (with more than enough help from myex-husband) but I also want to get myself out of this mess so any useful advicegratefully received. Sorry that this is soooo long.

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