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Under What Circumstances Can A Mortgage Be 'written Off'?

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I'm just wondering what sort of circumstances would lead to a mortgage being terminated.

Short of paying it off that is!

What happens if the lender goes bankrupt. Does someone else pick up the admin?

Absolutely clueless regarding this but am interested in the 'what if' scenarios.

Thoughts?

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If the bank were to go bust your mortgage would be an asset to someone else, so it would be sold off (probably at a loss) but you would still have to pay it. If you were to not pay it in any other way, they would eventually repossess the asset to get their money back.

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I'm just wondering what sort of circumstances would lead to a mortgage being terminated.

Short of paying it off that is!

What happens if the lender goes bankrupt. Does someone else pick up the admin?

Absolutely clueless regarding this but am interested in the 'what if' scenarios.

Thoughts?

Not quite what you're after maybe but mortgage insurance paid out on a FOAF's mortgage when she got a really serious cancer. She's completely recovered and is happily mortgage free.

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If your mortgage is sold to someone else (presumeably at a huge discount to the mortgage value), then don't you have course to appeal if you didn't get the chance to buy the mortgage for the reduced value?

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I'm just wondering what sort of circumstances would lead to a mortgage being terminated.

Short of paying it off that is!

What happens if the lender goes bankrupt. Does someone else pick up the admin?

Absolutely clueless regarding this but am interested in the 'what if' scenarios.

Thoughts?

You get to keep the house for free because the person you owe the money to doesn't exist any more.

(LOL of course you don't, but I just love to see peoples faces when they think it)

Re transferred mortgage. Its hapened often, you don't get any input as the terms and conditions remain the same (same contract and it does say about the potential to transfer ownership etc) so you neither benefit nor are disadvantaged. You may receive notification that an administrator has changed.

Edited by Redcellar

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If your mortgage is sold to someone else (presumeably at a huge discount to the mortgage value), then don't you have course to appeal if you didn't get the chance to buy the mortgage for the reduced value?

I imagine that any discount is a discount vs the total amount of profit that the lender was planning to make from your repayments, not the total outstanding capital that you owe.

i.e. The loan is projected to generate 300k in income over the next 20 years but is sold on for a discount price of 250k.

I'm not sure but I think that there might be a possibility for the debtor to settle the outstanding debt early with no penalty should the creditor change.

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If your mortgage is sold to someone else (presumeably at a huge discount to the mortgage value), then don't you have course to appeal if you didn't get the chance to buy the mortgage for the reduced value?

Nope! My first (and last) mortgage was with Northern Rock. It got sold to the government in under NRAM.

51 Page thread here if you are interested

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I imagine that any discount is a discount vs the total amount of profit that the lender was planning to make from your repayments, not the total outstanding capital that you owe.

i.e. The loan is projected to generate 300k in income over the next 20 years but is sold on for a discount price of 250k.

I'm not sure but I think that there might be a possibility for the debtor to settle the outstanding debt early with no penalty should the creditor change.

It can only be on the total still owing. You had a £300k mortgage, it's now £200k, it is bought at a (say) 50% discount, i.e. £100k.

Surely you should have the chance to "buy" the mortgage from the bankrupt bank for the best offered price?

I wonder if anyone has ever tried to challenge this in the courts?

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It can only be on the total still owing. You had a £300k mortgage, it's now £200k, it is bought at a (say) 50% discount, i.e. £100k.

Surely you should have the chance to "buy" the mortgage from the bankrupt bank for the best offered price?

I wonder if anyone has ever tried to challenge this in the courts?

?

A buyer entered a contract and it is that contract that is being sold on as an asset. It's up to the business who owns the contract what they sell it on for. They could sell it on for more or for less. It's their choice and not the mortgagees. It's also their choice who they sell to and if they sell it at all.

Securitisation was the mass selling of such.

There is nothing to challenge in court. You can't force anyone into a specific deal just because it suits you.

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?

A buyer entered a contract and it is that contract that is being sold on as an asset. It's up to the business who owns the contract what they sell it on for. They could sell it on for more or for less. It's their choice and not the mortgagees. It's also their choice who they sell to and if they sell it at all.

Securitisation was the mass selling of such.

There is nothing to challenge in court. You can't force anyone into a specific deal just because it suits you.

In addition, I doubt its single mortgages that are sold on, there would be a case that the banks creditors expect the best price to be achieved for the banks assets so if that was the mortgagors then so be it but could a group of mortgagors come up with the best price for 10000 mortgages. I doubt it, they're already up to thier eye balls.

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?

A buyer entered a contract and it is that contract that is being sold on as an asset. It's up to the business who owns the contract what they sell it on for. They could sell it on for more or for less. It's their choice and not the mortgagees. It's also their choice who they sell to and if they sell it at all.

Securitisation was the mass selling of such.

There is nothing to challenge in court. You can't force anyone into a specific deal just because it suits you.

But that's exactly it - it's a contract. between you and the bank.. Not you and whoever the bank wants.

A contract has to have reciprocity (sp), so presumeably the mortgagee could hand over the paying of the mortgage so someone else if they felt like it?

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But that's exactly it - it's a contract. between you and the bank.. Not you and whoever the bank wants.

A contract has to have reciprocity (sp), so presumeably the mortgagee could hand over the paying of the mortgage so someone else if they felt like it?

Yes and the contracts are worded such that if the bank were to be bought out or 'merged', your contract is a transferred asset to the new company. This is the same if they sell on your contract to another company. Any losses or gains they make as a result are entirely their own concern. It's none of your business what money was involved in the sale of 'their' assets.

It's dead simple. You signed a contract and were given some money and make repayments. That's the extent of your involvement. What the company then does in it's day to day business is nothing to do with you. They can sell cats to a mad old lady if they so wish. It just so happens they sell assets, such as your mortgage, to a mad old lady's pension fund instead. You still have your money and your contract (along with its obligations). That's all.

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It can only be on the total still owing. You had a £300k mortgage, it's now £200k, it is bought at a (say) 50% discount, i.e. £100k.

Surely you should have the chance to "buy" the mortgage from the bankrupt bank for the best offered price?

I wonder if anyone has ever tried to challenge this in the courts?

They're not selling the principle amount owing - they'd be selling the total amount of capital expected to be repaid including interest. You might be able to make a legal case to buy the mortgage for that amount but it would be in the ballpark of 3x the actual principle.

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It can only be on the total still owing. You had a £300k mortgage, it's now £200k, it is bought at a (say) 50% discount, i.e. £100k.

Surely you should have the chance to "buy" the mortgage from the bankrupt bank for the best offered price?

I wonder if anyone has ever tried to challenge this in the courts?

You do have the right to contact the liquidator and make them an offer, and if it is the best offer, they are obliged to accept it. However, they will almost certainly decide that the best offer overall is one for the entire portfolio, or even the entire business as a going concern.

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?

A buyer entered a contract and it is that contract that is being sold on as an asset. It's up to the business who owns the contract what they sell it on for. They could sell it on for more or for less. It's their choice and not the mortgagees. It's also their choice who they sell to and if they sell it at all.

Securitisation was the mass selling of such.

There is nothing to challenge in court. You can't force anyone into a specific deal just because it suits you.

Yes, but surely the receivers are obliged to obtain the best price for the asset. If they are going to sell it for half its value, why should they not be legally obliged to sell it to you (or anyone else) for 60%?

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  • 284 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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