Should I Capitalise arrears?

Hi I have posted previously under a case study and found the advice very helpful.

My husband fell into arrears on his home in 2009, I found out in 2012. He buried his head in the sand and arrears mounted to €45000. We have been paying the mortgage monthly for over a year now and have €23,750 in arrears left to pay.

Here is a brief summary:
Husbands Home (now living in my home)
Amount of Mortgage Interest Supplement received-Nil
Home loan-€292000
Lender: Ub
Amount outstanding: €290000
Value of home: €115000
Interest rate: specify whether tracker or SVR or fixed rate-SVR unsure of rate
Monthly repayment-€1136.71 as agreed with Marp process
Amount in arrears-€23750
Rent €900pm

Bank are sending letters and making calls daily at this point asking me to capitalise. I speak on my husbands behalf, from a mental health perspective he is not able.

Is it wise to capitalise? We cannot afford to pay anymore money on this house a month. I change my mind daily on what the next best move is? Bank are not anxious to help in anyway as we are making a full monthly repayment. They are not prepared to negotiate a long term plan in order for us to keep the house.

Any advice would be appreciated.

Your situation is not very clear from your post. That is probably why you have not received many replies.

It may be in your interest to have the bank capitalise the arrears on your mortgage. That generally means that the arrears are added to the outstanding capital, and you repay over the life of the loan.

How have you reduced the arrears from €45,000 to €23,750?

It is generally not wise to agree to any suggestion made by the bank unless you fully understand it.

The best course of action could depend on your age.

DEXTERS;

As Cremeegg says , it is unwise to rely on Banks advice.

Get a good independant adviser who will garner the facts and give you a good pathway.He/She will need to know the full picture. Make sure to keep notes/copies of any contact with UB.

You do not need an independent advisor on this one.

There is no downside to having arrears capitalised. It is always in your interest.

"Capitalizing arrears"explained October 2012

Brendan

I read Brendans very good and comprehensive advice on your previous post back in july. It would seem that the only progression since then is that your savings have been substantially diminished. I cant see any benefits to capitalising the arrears on this loan.i think its time both you and your husband took action and got rid of his property r by surrendering it to the bank.i personally would not pay another penny to try and keep it as you already have a home, an arrears free mortgage and a considerable amount of savings.

Hi mark

There is no downside to capitalizing the arrears, so he should agree to that.

The sustainability of the mortgage is a separate decision. If they want to keep the house, which most people do, capitalizing gets rid of the arrears. If they decide to get rid of the house, that is fine. But capitalizing the arrears makes no difference to that.

Unless, there is some advantage to heavy arrears in dealing with the local authority in trying to get social housing.