mortgage settlement

A question about : mortgage settlement

Hello folks i am new to this so hope someone can help.
I currently have a mortaggae with the mrs, the brother is the same and me and the briother bought another house between us- at the peak obviously! and now we want rid of this middle house. we bought for 150 thousand, from a further advance from weach of our existing houses and we alos took out an interest only mortgage for 91 thousand which is still at this amount, the thing is the house has dropped in value to approx 60 thousand.
las night we met with a company- who informed us that they act as in intermediatory adn ' bargin' with the lender to write off the debt for a fee. he has assured me this is not bankrupcy but it would show on my credit report as unsettled. i am wondering has anyone gone down this same rioute and would it be bad for my credit rating down the line?
hope someone can help
thanks for reading

Best answers:

• Paying a fee to act as an intermediatory sounds suspect straight away. From what I can understand from your terrible English (mines not much better), You are 1k in negative equity. You have little chance of getting anything written off (if that is even possible) what will likely happen is any shortfall on the mortgage from the sale of your property will be added as a charging order to your resident property, should you refuse to clear the outstanding balance.
• Was in a rush michael typing that.
  All in- we are actually in 31 thousand debt if we were to sell the house, plus the further advance we both have each on our 1st properties. so i am looking rid of the joint house with my brother and just suck up the extra money i borrowed against my 1st property. in essence, this company go to the lender and tell them the negative equity, and normally a price of between 10-20% of the negative ie lets say 15% of 31 thousand roughly 4.5 thousand. then on top a fee to this company for sending letters back and forth of 3000 pounds. so all in i would potentially save 10 thousand and my brotehr the same. i am wondering if anyone out there has delt with this typ of thing, i dont think the company are scammers, i just would like to know what way it would affect my credit for future life.!
  thanks again
• I wouldn't use with the intermediary company. How much would they charge you for doing this work anyway? how much of it upfront?
  I don't think they can get any deal from the mortgage company that you could not get for yourself.
  Do you have any remaining equity in your main home? does your brother?
  In your situation I would approach the mortgage lender and explain that you need to sell the property and believe you could get x for it and ask them whether they would be likely to accept a reduced sum in full & final settlement of the remaining debt.
  As you own other properties then I suspect they would not reduce the liability by much, if at all.
  In terms of your credit file - if you can get them to agree a reduced settlement then it should be marked as partially settled on your credit file and show that there is no balance outstanding. This will mean other potential lenders searching your credit file will be aware that you made a reduced settlement on that debt. This would appear on your credit file for 6years from when you settle.
• Are all the mortgages with the same lender?
  From what I understand there are 3 properties potentially involved here
  Can you give an estimated figure of posative/Negative equity of those properties
  Your resident = +/- Јxx,xxxx
  Brothers Residence = +/- Јxx,xxx
  Your Joint Residence = Ј-1,000
  With this information it would be easier to advise if you might be able to broker a deal.
  To be honest I have never heard of reduced settlements given on mortgages, especially when payments are up to date. I have heard of lenders allowing you to sell the house and issuing the remaining balance as a loan though.
• okay so here goes.
  House 1- brother and wife- mortgage of Ј180,000 part of this encompases further advance for the joint property. value of house is roughly Ј150,000
  House 2- my house. mortgage is for Ј138,000 part of this again encompases further advance for the joint house. house value approx Ј100,000
  House 3- joint between me and my brother. Mortgage for Ј91,500 and house value approx Ј60,000
  All three are with different lenders
  Whilst talking to this company, they explained that they ahve the relationship with lenders, with estate agents and solicitors. so in basic, they write on your behalf, stating what you can and cant afford. this guy told me that he can do for one house, two houses or all three. they are all looked at individually. he charges Ј300 quid for each then accesses my nortgage details. he goes through a expence study with each of us detailing specifics right down to haircuts etc. he then goes to the lender and says this is what we feel is fair payback and he says its normally between 10-20% of the negative equity. then once this is complete his fee is another Ј3000.
  all this money must be paid in cash, so need to have money ready to pay it. this is all on the basis that the house sells.
  hope this makes sense.
  thanks for your input
• Do not touch this person with a bargepole. He is essentially recommending that you go onto a DMP, although in suggesting that he do it across all three properties, he may end up pushing you into bankruptcy.
  Get a formal valuation on the property you wish to sell and go to the lender with your brother. Ask if there is the possibility of converting the remainder of the mortgage into a joint loan (or splitting the sum between you into separate loans) if the property is sold. They might wish to come to an arrangement with you.
  Sell the property yourself, using the Rightmove service, which will also save you a fortune in estate agency fees.
  I wish you luck, but what this consultant is suggesting you do may well wreck your credit rating for the next six years or risk your homes. Lenders will not accept settlements if there are realisable assets (your homes). This man is going to take your Ј3k, and leave you up a certain creek without a paddle.
  Stop talking to him. Stop taking his calls. He will tell you everyone on here is wrong, and he knows what he is doing. He is a scam artist who is preying on your lack of knowledge and worry about your situation.
  Go to the lender. They know what they will accept, and they won't charge you for talking to them.
  Good luck
• What are mortgage repayments on the joint house? And what is the rental? Plus fee's
  Can you and your brother afford the repayments on each of your respective homes through salaries?
• Despite having the Negative equity, why are you actually wanting or needing to sell the property?
  Are you not able to just ride out this downturn? just covering costs in the meantime rather than realising an actual loss on Sale..