# Can the bank force me to give up home



## Peabody (16 Oct 2012)

Hi

I am just wondering does anybody know the answer to this one. I've looked through the site but cannot find any discussion on our situation.

My partner and I have a mortgage together on our home and are meeting a restructured payment plan.
Unfortunately he has a buy to let which is in his sole name and in huge negative equity.

Can they force the sale of our home if his name is on the title and mortgage.

The mortgage on the btl is almost two and a half times the rental, excluding maintenance fees etc and we are missing payments left right and centre.

Thanks for taking the time to read.


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## Bronte (16 Oct 2012)

Is there any equity in your home?


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## Peabody (16 Oct 2012)

No. We are down about 50k.


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## Bronte (16 Oct 2012)

Actually that's a good thing, the negative equity. The bank may put a judgement order on the house, meaning that if you ever sold then 'his' share would belong to the bank. But it would really be a waste of time getting a JM if there is large negative equity. If though there was a lot of equity in the house they might go for a JM and then go for a well charging order to force a sale. You'd though still be entitled to your share.  

You have to hope that the banks get more realistic and write down the debt on the 'investment'. What are the bank saying?  Do you want to do figures on your income an expenditure to see if you have any chance of repaying the BTL?


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## Peabody (16 Oct 2012)

Supplementing it is 650 a month. We cannot do this and I wont do this. I have children and I will put their interests ahead of any Banks any day.
I am not paying that mortgage, they can have the rental income. I dont care anymore and I'm not going to worry about it. 

Feeling pretty defiant right now.


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## Bronte (16 Oct 2012)

Cannot and wont are two different things. Your OH owes the money and if you can afford to then you should help to pay it back.  The only people who can be defiant are those who have nothing else to lose.


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## elcato (16 Oct 2012)

Get your partner to write to the banks offering the rent. Tell him to keep all correspondance and ask them for everything in writing. As you say, don't worry too much about it as I doubt anything can be done in the short to medium term and they would almost certainly avoid any ideas of a forced sale (as per Bronts post).


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## Brendan Burgess (16 Oct 2012)

Bronte said:


> Your OH owes the money and if you can afford to then you should help to pay it back.



Hi Bronte

I don't really agree with this at all. 

The investment property is in his name. The mortgage is in his name. I don't think that Peabody should use her resources to pay off his loan.

If the two mortgages are with the same lender they might come to some agreement on interest only for both properties. 

He should not be repaying capital on his home loan while he is falling behind on capital payments on his rental property. 

Peabody should only make a contribution if she can afford to and if the bank give something significant in exchange.  But as she can't afford to, it does not arise. 

Brendan


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## Peabody (16 Oct 2012)

Elcato what to you think the tone of the letter should be. I don't fancy groveling right now, not in the mood ( don't know where this is coming from).

Bronte I'd love to be able to repay them, they did give him the money after all, but we can't. We haven't got it.


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## Brendan Burgess (16 Oct 2012)

> Feeling pretty defiant right now.





Peabody said:


> I don't fancy groveling right now, not in the mood ( don't know where this is coming from).



It's called "The Askaboutmoney Empowerment Effect"


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## Peabody (16 Oct 2012)

Hope it lasts.

Just finished the letter to the bank. Their address is longer than the letter. I'll just sit back and wait.


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## Brendan Burgess (16 Oct 2012)

I presume it's your partner who is writing the letter and not you? 

Brendan


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## Peabody (16 Oct 2012)

No I've written it. He tends to let things slip and so it goes on a bit too far for my liking.
I run it by him and if he agrees we go ahead. Its how we operate.


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## Brendan Burgess (16 Oct 2012)

But by you writing, you are involving yourself in his mortgage.  

I think it's much better for you to draft the letter and let him sign it.

Brendan


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## elcato (16 Oct 2012)

Brendan is correct. I presume you just put his name on it. One of the opldest trick in the debt collectors book is to involve the wife as she tends to take matters on as in your case here. Don't involve you at all or they may keep hounding thinking they could get you to deal with it.


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## Peabody (16 Oct 2012)

No, I draft and he signs. We are not married and I don't intend to. I do not want to be legally tied to his debts. Sounds cold but its true.


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## Time (17 Oct 2012)

Even if you were married the legal situation is no different.

Fair play to you for standing up to these people.


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## becky (17 Oct 2012)

I don't think it's sounds cold at all.  It's sensible.  If you did the opposite, I'd think you were a bit silly.  Best of luck.


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## Bronte (17 Oct 2012)

Brendan Burgess said:


> Hi Bronte
> 
> I don't really agree with this at all.


 
In Peabody's circumstances I agree with you, as they cannot afford the debt, which only came to light after your post. So depending on the circumstances one has to decide what to do. 

Whether married or not Peabody is not responsible for her partners BTL mortgage. But whether one is responsible or not it can have bad repercussions for both parties if one doesn't make the right choices. 

Scenario 1.

Peabody could afford to subsidise the BTL, then in a stable family situation it is better to pay down the BTL so that any equity being built up in the family home can not be touched by the bank. Take the ultimate scenario where they jointly owned the family home with zero mortgage and house was worth 2 times the BTL. With both parties having equal shares. In that scenario the bank would come knocking for his share and ultimately family home would be sold, she would get her half but would no longer have a home. 

You can be sure that the banks will show no mercy if there is a lot of equity in the family home that is available to the banks should Mr. Peabody have a large BTL mortgage that goes unpaid. 

Scenario 2. 

Peabody cannot afford to subsidise the BTL, then it is better that her partner builds no equity whatsoever in the family home. She should in fact pay all the mortgage and he should pay zero, in an effort to demonstrate that the house belongs to her. This is quite tricky. 

People always assume that the family home is always an equal 50/50. But this is not so. Court judgements as far as I know time and again have judged that whoever pays the mortgages is entitled to the equity based on what is put in by that person. It gets more complicated in family home situations but that is the way it is interpreted by judges. Even more complicated is the fact that if one pays for the mortgage and the other pays utilities and groceries, the person paying the utilities and groceries will be judged to also be contributing to the household and ergo the mortgage. The only thing that is not equal to money in this scenario is for example a mother who looks after children at home, that has a zero monetary amount as per Irish courts.

Going forward, it would be best if the bank let Mr. P sell the BTL and they write down his NE. The more he demonstrates he cannot afford it and the more he shows he owns nothing, the more likely a bank will do a deal. 

I have no crystal ball, but would a bank try to enforce a court to decide that he had equity in the family home if say he didn't directly contribute towards the mortgage from his salary. The banks are not exactly flavour of the month with the courts, I would like to be the bankers barrister advising them on this likelyhood of this untested area. 

If Mr. P was really smart, he'd be putting some of his salary in a hidden account for the rainy day. That is the ultimate logic of scanario 2 where a bank will not deal with the BTL problem. And hopefully with the regulator jumping up and down yesterday about banks not dealing with the problems maybe Mr & Ms P will be able to move on. But I wouldn't count on it.

And watch out for the sneaky stuff the banks are at now, telling people in Peabody's situation that she is responsible for Mr. P's debt, not true.  Whether married or not.  They won't write that down, but they'll certainly lie it straight to your face.


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## Peabody (17 Oct 2012)

I cant understand how an institution which I have no relationship with whatsoever can come and take my 'asset' from me.
I love the fact that I must be the only one in the country that will enjoy being in negative equity.


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## Peabody (17 Oct 2012)

Right I'm going outside to knock down the garage.

If they repossessed the btl he would owe the balance which would be unsecured i assume.
Can't get blood from a stone and I'm sure the kind Judge would agree.


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## Time (17 Oct 2012)

Correct. But they could shove it on your house as JM.


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