I have a house that is about to be reposessed by the Woolwich. We have had the house since 1991 and the outstanding balance is about 40% of the market value of the house.

There is also a small secured loan on the property with another lender. What is likely to happen regarding payment of this loan.

Also if the house sells for anywher near market value what will happen to the excess money. Will we recieve this money?

-- Alan Borrington (a_borrington@yahoo.com), April 17, 2004

Answers

You say you are about to be repossessed - is there anything you can do to stop repossession? What stage has it got to? Have you been to court yet, and if so, were you given a suspended possession order which has now been breached?

The secured loan will be paid of out of the proceeds of sale along with the first mortgage and all associated costs and you will then receive any balance. But realistically, in a lot of cases, dare I say the majority - the house sells for a lot lower than market value and the somewhat punitive charges together with ongoing interest usually eats up any surplus you might expect, and indeed, even worse, creates a shortfall which the mortgagees then pursue.

If you have got a court date for a possession hearing - make sure you go to it and make an offer to pay off the arrears together with the ongoing instalments - the possession order will then be suspended under the Norgan rules. If you are at the stage where you have breached the terms of a suspended order, then apply for it to be varied (to the court), if you are at warrant of possession stage and are waiting for the bailiff to evict, then make an urgent application to suspend the warrant.

Judges do not like making possesion orders and dislike making warrants of possession orders even more - eviction is an absolute last resort and the law, and the Norgan rules are on your side throughout.

If income is your problem - go se the CAB and make sure you are claiming everything you can.

If you are worried about court appearances, be assured that they take place in a judges chambers, not in public - take a friend if you have to for support.

Let me know by email if you want any further info.

-- David J. Button (davidjohnbutton@supanet.com), April 17, 2004.