Is your mortgage unaffordable? Despite the fact that the base interest rate has been running at an all-time low of 0.25% since Spring 2007, mortgages remain unaffordable throughout the country. So too are the examples of negative equity mortgages in which borrowers are swimming against the tide in trying to service the debt on a property which now is valued at less than the price for which they bought it.
The reasons for mortgage debt are almost as plentiful as the examples of this sorry state of affairs. The break-up of relationships continues to be a factor, with divorce rates in the UK the highest in the EU. Where once there were two incomes contributing to the monthly mortgage repayment, the loss of one of these obviously creates a major problem. And while, in a better economic climate, selling would be the solution, in situations of negative equity that may not be an option. If you are in such a situation, it's time you sought the help of experts.
Negative Equity UK have a proven track record on such matters; contact them, not least because your first consultation at which the extent and exact nature of your problem can be examined – is free. Once that is identified, decisions as to the best course of action can be made.
Changes in employment have played a part in the prevalence of mortgage debt, too. Through no fault of their own, many who took out mortgages at a time when they were in well-paid posts or jobs in which overtime opportunities were plentiful have ended up in much-reduced circumstances. In addition, in recent times in the UK, we have suffered the loss of some major industrial ventures, not least in the manufacturing sector. These factors have led to unaffordable mortgages becoming rife all over the UK.
Those paying interest-only mortgages are in a particularly difficult and stressful position since, as things stand, many of them are not going to be able to settle their capital loan debt when their interest repayment term expires.
So if you are one of those whose mortgage currently is unaffordable or almost certainly will be when base interest rates start to rise – what can you do? Is there a way out of this? And if so, what is it?
Firstly, be assured that there are solutions.
Secondly, be aware of the fact that unless you are highly conversant with the world of finance, lending and the law with regard to those areas, almost certainly you are going to require professional help from specialists in these fields.
Thirdly, understand that there may be more than one option when it comes to solving your particular problem(s) so it is important that you understand exactly what these are, what they entail, how they will or may affect you now and in the future and, crucially, that you are offered choices which are realistic, viable and in YOUR best long-term interests.
In other words, don't take advice on these issues from well-meaning friends or relatives with limited knowledge and no experience in these matters.
Negative Equity UK are endorsed by the Financial Conduct Authority (FCA), the UK's financial regulatory body.
In qualifying for FCA accreditation they have met stringent requirements on their code of conduct and their staff's product knowledge. Thus, whatever your problem or the underlying reasons for it, you can know that NEUK will have dealt with others very like it if not quite identical. You can also know that they are skilled negotiators whose raison d’tre is to reach a settlement acceptable to and agreed on by both debtor and creditor.
NEUK act on their client's behalf by sitting down in their place to deal with those to whom money is owed. They also serve as a buffer, which means that lenders can and must only deal with them, rather than you, the debtor. That means the client is spared the addition of penalty payments, final demands and threats of legal action.
Banks and building societies are willing to listen in cases of genuine hardship, not least because they would much prefer to negotiate a settlement than to repossess a property they would then have to sell at a reduced price. Where the case for such an outcome is put by professionals whose knowledge and negotiating skills they respect, lenders will do business.
En route to making any settlement offer, NEUK will have sought to sort out any other debts, too, as well as having examined every other possibility of help with mortgage payments and/or a home affordable modification programme. No stone is left un-turned.
Proof of the pudding as to the effectiveness of their work? In the first four and a half months of 2016, NEUK have negotiated the wipe-out of more than £2,000,000 in the form of Resolution Write-Offs and Bankruptcy Debt Write-Offs.
They also know that they have a limited period in which to pursue the debt. Once that period expires, the law deems that debt to be unenforceable. In addition, banks qualify for a reduced tax bill where debt is written off as a result of an agreed settlement. So that's an incentive for them. Where negative equity is the main problem, settlements can include negotiated debt write-off, one-off payments, renegotiated terms or help with selling a property if that proves to be the only way out.
For anyone in that position, drawing a line in the sand makes a lot more sense than trying to do the impossible. A fresh start as a result of a negotiated settlement enables people to rebuild their lives based on reality rather than on a fantasy that, somehow, it will all fall into place.