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Landlord Mortgage Arrears - Advice Please

edited January 2012 in Not Sports Related
Anyone know where you stand as an Assured Shorthold Tenant if your landlord is mortgage arrears?.

Have come home tonight and there is a hand delivered letter here (open) from an independent company engaged by Barclays. They are saying they need to discuss the arrears on the mortgage for the property. Saying this is the final opportunity to discuss the matter before possession proceedings are instigated.

The property is let through an agent but managed by the landlord. Him and his family live in Cyprus. Our tenancy runs until end of March. I assume we are safe until then?.

Any advice or knowledge of the situation would be welcomed.

Cheers.

Comments

  • Bloody hell. Depressing reading.....
  • Im sure if you contact them mate they will probably be able to give you more detailed advice and might not be so bleak. Id stop paying your rent though as unlikely youll be seeing a deposit back if he's gone awol...unless of course the management company are holding it.

    If the contract is with the letting agency surely they are liable?
  • The deposit is held in the official deposit scheme so its safe. The letting and tenancy agreement is all done through a High St agent.

    Landlord isn't awol he has lived abroad the whole time we have lived here. He is always contactable. I might bluff it and say that someone called round and spoke to us. Want to confront him with it to be honest. We've been here 2 years and were hoping to extend it for another.
  • Probably best to be honest as he may not even be aware of the situation.
  • Probably best to be honest as he may not even be aware of the situation.
    this is what i would do.
  • Yes. Contact your landlord. It might just be a simple mix up with direct debits - maybe due to the Bank Holidays over the Xmas period for example, although it's also quite possible that the bank doesn't know that he is renting the place out.

    As a landlord myself I would prefer my tenant contacted me.

  • edited January 2012
    Contact the landlord. Bank would not be able to terminate your AST before it expired but could well refuse to extend at expiry if they took possession as it would be easier to sell as a house than as an investment. You should def speak to the landlord as it could just be a miss communication, happens all the time.
  • I would also advise you take some legal advice.
  • http://england.shelter.org.uk/get_advice/repossession/repossession_by_a_landlords_lender has a lot more (assuming you're in England that is - bits of housing law are subtly different in the 4 countries of the UK (if you're in the UK but not in England then go back to Shelter's home page and start again.)

    They also have an advice line that might be worth a call. If there's a Shelter housing advice centre near you, they may be more use than a generalist adviser at CAB - bear in mind that both are at least to some extent voluntary and under pressure at the moment.

    I'd be inclined to agree about contacting the landlord - as others have said, may be a simple bank cock-up. If you can't get hold of him or if he sounds like he's B-S'ing, then get qualified advice quickish.

    Don't know whether it would help you at this stage to contact the people that are chasing payment and explain what's going on and that you're a tenant there. The Shelter page seems to suggest that you should contact them and if you go about it the right way this can delay any proceedings.

    Ultimately, if you're in the shark infested waters of renting privately, the best you're likely to get is 2 months' notice (although again this depends on the exact sort of tenancy you've got.)

    Best of luck.
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  • I would certainly get some legal advice as well as contacting your Landlord in case its an error.

    Having read the Citizens advice page, I wonder whether the advice given there is the full extent of what can be done.

    If you were able to come to an arrangement so that you paid them the rent direct, I suppose it depends on how much it is costing the mortgage company to borrow the money for the outstanding loan on the property. If the asset is not appreciating much in the current climate, it may be advantageous for them to keep you on as a tenant.

    I also wonder how, if an assured tenancy agreement has been taken out, it can be set aside in the event of an agreed fixed term? I guess it depends on the terms of the mortgage as to what happens in the event of default. I always assumed that a mortgage company takes over the beneficial rights of the property and takes whatever action it can to defray the debt. If that is the case, surely if they assume the direct rental payments, they are obliged to continue the lease until the expiry of its fixed term?

    Anyway not an area of law with which I am particularly familiar.
  • I would certainly get some legal advice as well as contacting your Landlord in case its an error.

    Having read the Citizens advice page, I wonder whether the advice given there is the full extent of what can be done.

    If you were able to come to an arrangement so that you paid them the rent direct, I suppose it depends on how much it is costing the mortgage company to borrow the money for the outstanding loan on the property. If the asset is not appreciating much in the current climate, it may be advantageous for them to keep you on as a tenant.

    I also wonder how, if an assured tenancy agreement has been taken out, it can be set aside in the event of an agreed fixed term? I guess it depends on the terms of the mortgage as to what happens in the event of default. I always assumed that a mortgage company takes over the beneficial rights of the property and takes whatever action it can to defray the debt. If that is the case, surely if they assume the direct rental payments, they are obliged to continue the lease until the expiry of its fixed term?

    Anyway not an area of law with which I am particularly familiar.
    I think the lender would have to sell the property in the event that the reposed it. There are struck rules about this as any equity in the property will belong to the borrower/landlord.

    The good news is that you wouldn't expect the lender to repossess before March as these things take a long time from when they approach the courts. Also once they have a repossession order they would have to apply to the court to have you evicted.

    I think I would be considering looking at your options in March, however, as it's just conceivable that you could find yourself being evicted and still having to pay rent right up until the day the eviction takes place.

    I would be very careful how you tell the landlord that you have read his private mail as it is a serious crime to open someone else's mail and it might be better to keep that to yourself.
  • KHA. As advised earlier, I didnt open his post. It was a hand delivered envelope, unsealed and not addressed. The letter itself was addressed to him and his wife.

    I'm going to email him and am going to have an informal chat with one of the advisors I know here at Greenwich Council.
  • What exactly is the letting agent doing about all this? They should be earning their management fee.
  • What exactly is the letting agent doing about all this? They should be earning their management fee.

    As I said earlier they dont manage the property. The tenancy and deposit was dealt with by them. The rest is a direct relationship with the landlord.
  • KHA. As advised earlier, I didnt open his post. It was a hand delivered envelope, unsealed and not addressed. The letter itself was addressed to him and his wife.

    I'm going to email him and am going to have an informal chat with one of the advisors I know here at Greenwich Council.
    Clem, I wasn't making accusations towards you, just suggesting that you are careful how you proceed. If it get's nasty (which it sounds it might) you have no idea what some people will accuse you of.
  • For it to have got this far, it sounds like he hasn't been paying the mortgage for a few months rather than it just being a simple mix-up.
  • I seem to recall there being a clause covering this event in my contract as a landlord, no idea what though, so worth checking the contract (sorry if already covered further up)
  • Happened to me 20 years ago - had a reposession notice nailed to my flat door at 4AM! I thought someone was trying to batter the door down. I contacted the mortgage lender who would not talk to me - land lord had not told them he had let the flat. I stopped paying the rent and used the money towards a deposit to but a flat nearby. The lender did eventually agree a period of grace for me to move out without being slung out. Not necessarily covered under the advice above but it was a practical solution for me.
  • KHA.

    I'm going to email him and am going to have an informal chat with one of the advisors I know here at Greenwich Council.
    Good plan, Clem.

    Give the landlord a chance to put things right first.
    As you say your landlord is always contactable, talk to him first and see what he says.



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