Independent Banking Advisory Service 

Mortgage Shortfall Claims and case studies

AA wrote to IBAS desperate for help resolving a £37,000 mortgage shortfall dispute with Britannia Building Society. Continued pressure from the lender left her in a state of depression and unable to work. After IBAS had successfully resolved the matter for her she sent the following email and requested we post it on our web site to give hope to others experiencing similar problems

"Subject: Gratitude..
To Sara,
I wanted to send this to direct to your inbox but was unsure of the correct spelling of your name. I cannot begin to express my gratitude for the work that you have done for me. The matter between myself and that building society has hung over me for nearly 10 years perhaps even more. It took me to the brink of despair and nearly ruined me both mentally and physically.

For me there was no light at the end of the tunnel I felt hunted and trapped. Every future plan was blighted with this situation. I avoided the money sections in the papers and would cringe when the T.V blared out ad's of aid for people in debt. Your article in the Daily Mirror was a God Send for me something about it drew me in and made me read where usually I would have just ignored I then thought why not give them a try they can't make it any worse! You have exceeded expectations with your speed professionalism and results; I will sing your praises and the organisations at every turn. Once again let me thank you for your efforts on my behalf as you have changed the quality of my life - Many many thanks" AA

If you require truly independent and impartial banking advice plus direct assistance from a unique specialist organization campaigning on banking issues, which directly helps our members email us or call us on 01487 843444 for membership.  

When the CAB was unable to resolve PB’s mortgage shortfall, he turned to IBAS for help. Halifax was claiming £42,000 against a repossession in 1998. Whilst Halifax had complied with the Voluntary Code, their claim was unrealistic when viewed against PB’s financial circumstances and future earning potential. IBAS persuaded Halifax to accept a reasonable figure in full and final settlement.
PB wrote simply "I cannot thank you enough for sorting this out. When the CAB failed I thought there was no hope, but you proved otherwise".
  _________________________  
AS and his wife sought the help of IBAS after receiving a Statutory Demand for bankruptcy against a mortgage shortfall debt of £124,000. He and his solicitor had embarked on a protracted exchange of correspondence with Eversheds acting for The Mortgage Corporation, which eventually provoked legal proceedings. It was important to act quickly and within a week of receiving the file IBAS persuaded them to withhold the action to allow negotiations, which led to a full and final settlement.
AS emailed us saying, "I can now relax. Without your help we would not have resolved this problem - we know for sure".
  _________________________  
Abbey National repossessed M and J's house in 1992, but did not chase them for the £22,000 shortfall until 1999. Although this was before the introduction of the Voluntary Code, they were not aware that such a delay was unreasonable and accepted the debt in agreeing a monthly payment of £50.00. Keen to rebuild their lives and ensure a new home would not be endangered by this debt, they asked IBAS to negotiate a conclusion. Within six weeks we reached a full and final settlement.
They wrote "Many, many thanks".
  _________________________  
Bristol and West had already obtained a Charging Order on LS's new home when she came to IBAS for help. Equity in her new home had been the incentive behind their claim of £43,000 against a shortfall (before costs and interest) of £21,000 dating back to 1995. Our involvement was sufficient to halt repossession of the new property whilst LS raised funds through an equity release, which was paid as a lump sum full and final settlement.
Her note read, "I can’t thank you enough and am so glad this worry is eventually over".
  _________________________  
Hammond Suddards Edge acting for Bradford & Bingley had been chasing JH some years when he came to IBAS to resolve a £32,000 shortfall. Like many people he believed the MIG he had paid for would cover the shortfall and was shocked to discover that this was for the sole benefit of the lender. Having already entered into a repayment scheme he had accepted liability and with a new business beginning to make headway was keen to put the matter behind him. IBAS negotiated a full and final settlement.
He said "Thanks for sorting this deal out for me. I can now concentrate on by business without the fear of this lurking behind me". See OFT Complaint by IBAS
  _________________________  
Agents acting for National Home Loans in respect of a mortgage shortfall of £68,000 were chasing MS relentlessly. Her solicitor accepted the debt and also provided income and expenditure details, which were not helpful to her position. When they obtained an attachment of earnings and then a Charging Order over the home she owned with her new husband, her solicitor suggested she approach IBAS and promptly returned her file. At such an advanced stage negotiations were difficult, but we persuaded them to drop their charge and accept a full and final settlement.
She wrote, "This is such a relief. I only wish I had know about your organization earlier".
  _________________________  
DM was devastated when she realized a shortfall claim of £17,000 from her previous marriage was jeopardizing the property she now owned with her new husband. With £60,000 equity, Birmingham Midshires were chasing her for payment as an alternative to possession of her new home. Concerned of the effect this would have on her marriage, we guided her in submitting details to support her position, which led to a full and final settlement.
She wrote in saying "I would like to take this opportunity to thank you for all your assistance in helping me reach this settlement".
  _________________________  
J & D lost their home in 1996. Halifax pursued a shortfall and in Summer 2002, issued proceedings for £43,000. It was only at this stage that they approached IBAS. Judgment was due to be entered and it was therefore vital that an offer of settlement was reached quickly, particularly as Halifax had indicated their next move would be a Charging Order over the new family home which offered £30,000 equity. Of greater importance was that the family home had been adapted to accommodate the couple’s severely disabled son and any threat to his familiar surroundings would have adverse effects on his condition. Within two weeks a full and final settlement was agreed on behalf of the family.
J & D's relief was clear in their simple note, which read "Thank you so very, very much".
  _________________________  
Nationwide came to a £3,200 settlement with AW's ex-husband in 2000, which he led her to understand, was for her liability also. She was therefore shocked in 2002 to be approached by an agent chasing her for payment of the £21,000 shortfall. Unfortunately she had nothing to prove that the settlement was for her as well and turned to IBAS for help. As a single Mother of two children her ability to pay was limited. Nationwide agreed to place the matter on hold for six months to allow her to save towards a settlement at which time we agreed a full and final figure.
In her letter she wrote, "I was at my wits end and dare not answer the phone. When I came to you I thought there might be light at the end of the tunnel and now I know there was. Many thanks".
_________________________  
HG and her partner took out a £32,000 mortgage with Halifax in 1993 to buy a new home in Merseyside, but due to her partners violent behaviour she was forced to leave in 1999. She placed the property on the market but Halifax commenced possession proceedings and took control of the sale. Despite an increase in property values, they sold for a knock down price of £23,000.
She heard nothing from Halifax until August 2001, when she received a letter from Halifax’s solicitors claiming she owed £18,150 for a shortfall debt. They threatened legal action if she did not pay the full shortfall or agree to unrealistic monthly payments. She contacted IBAS in January 2002 and in February we negotiated a full and final settlement.
After the settlement was reached, she wrote to IBAS: "I cannot thank you enough for your support and all that you’ve done to help me. I only wish I had found you sooner".
  ________________________
GS’s solicitor had been in dialogue with Bradford & Bingley’s agents for two years regarding a claimed shortfall of £27,664. It was evident from the file that despite being paid substantial fees, the solicitor had achieved nothing, other than acceptance of the debt on behalf of his client. Several offers of settlement had been made by the solicitor and rejected.
She was desperate when she contacted IBAS, as the lender has already sought an attachment of earnings and a Charging Order against the property she owned with a new partner. They were also threatening bankruptcy. Their motive was, they claimed, that her new property held a greater level of equity than stated on the income and expenditure schedules submitted by her solicitor.
Whilst the various legal actions created complications and placed the lender in a strong position, IBAS were able to convince them to accept a lump sum payment in full and final settlement of the debt.
Her words express her relief "Thanks is all I can think of to say, but that’s not really enough".
_________________________
CR and her ex-husband took out a loan of £7,500 secured against their home, with UDT in 1991. Monthly repayments were maintained until they sold the property, at which time the charge was settled from sale proceeds. She was therefore shocked in 1998 to receive a Court summons for £6,590 in respect of unpaid interest, which they had failed to include at the time of settlement.
The Court ruled that the claim was legitimate and CR found herself with a Judgment against her name. By this time she was a single parent dependent on income support and unable to meet UDT’s agents constant demands for payment.
Feeling totally debilitated by a combination of personal and financial problems, she contacted IBAS in January 2002. The following month we negotiated a full and final settlement which was paid, be her relatives.
Her relief was expressed in her letter "All of this left me physically unable to cope. Now with it all behind me I wish to thank you for negotiating on my behalf and I can now think about the future again".
  _________________________
Mrs J M and her ex-husband took out a mortgage of £30,000 with Abbey National in 1990. The following year they separated, she left the property, signing agreement for her husband to remain in the property. In September 2001, she received a letter from the banks agents claiming a shortfall debt of £31,000. She discovered the property had been repossessed and sold in 1995. By this time JM held a management position with a bank and was very worried, as this claim could adversely affect her employment prospects.
IBAS investigation discovered contact had been made with her on the very day of expiry of the voluntary 6 year Code. Whilst this meant they could legally pursue her for the debt, we suggested their conduct had been less than reasonable. We negotiated a lump sum full and final settlement for her portion of the debt. She wrote simply "Thanks seems inadequate".
  __________________________
C&J, both close to retirement, thought they were doing the right thing when they contacted a local solicitor following repossession of their Cambridgeshire home. The solicitors entered into involved dialogue with Britannic Mortgages and in doing so, accepted the claimed shortfall debt of £30,000, whilst adding hefty charges to the couples existing debts. At this stage they contacted the CAB who were sympathetic, but unable to persuade Britannic to accept a settlement within their means.
Subsequently J was made bankrupt and the lender then concentrated their efforts on C, pursuing her and calling at her home at unreasonable hours. Under severe pressure they moved to the West Country to be near family and at that stage contacted IBAS. We have now resolved the case. C said in her recent letter "This is such a relief, we cannot express deeply enough our gratitude for the conclusion to this matter".
  ________________________
RW approached IBAS having just received a demand for £40,000 and legal proceedings, just days before the six-year limitation kicked in. The case was difficult as they had a new property offering equity close to the value of the shortfall. Halifax demanded immediate repayment of the full shortfall as an alternative to seeking a Charging Order against their new home. The case was further complicated as the couple were high earners, and Halifax’s solicitors took the attitude that they could increase their mortgage to release the equity to repay Halifax. Less than two weeks after accepting the case, IBAS negotiated a full and final settlement.
They wrote simply "Our most sincere thanks".
  ______________________________
Mr H a cab driver and his wife were shocked to receive a demand for £59,000 in respect of a shortfall debt. They had taken out a 100% mortgage of £80,000 on their London home with Credit Agricole in the early 90’s, but were forced into repossession in 1996, as they were unable to maintain the mortgage repayments when Mrs H became pregnant.
The banks agents pursued them relentlessly until they were pressurized into agreeing to pay £50 per month. Later they contacted IBAS for assistance and a full and final settlement was negotiated.
Mr H wrote to IBAS "Many, many thanks for all your help. Without you I’m sure we would have had this nightmare round our necks forever. It has made so much difference to my wife's health to have this all sorted out".