Building society wants missed capital paid after illness, facing eviction

[Lucyweeks]

Due to illness we've been paying interest only on our mortgage. It's been a year due to operations and chemotherapy.
The building society want us to pay the missed capital payments or sell the property.
This we've tried to do. We've now got a new agent and some interest. We're happy to move to something smaller.
The building society are threatening us with eviction if we don't bring our account to date.
Has anybody else managed to overcome this?
All advice welcome.

I’m sorry to hear you’re going through all this.

Have you spoken to citizens advice or specialist charities like Shelter?

Yes. They can't do anything until they issue a eviction notice. I have plenty of equity in the house but by their rules I've been ill for too long.
After a year they repossess. We've got some interest but the potential buyer is dragging their feet.

I believe the eviction could be two weeks and I'm disabled so suitable rented would be hard and near impossible with a damaged credit file.

How much is owing on the mortgage? If you have a lot of equity already would it be possible to pay it off with a loan or a bridging loan to give you time to sell? Probably an expensive option. Or put the house in an auction although that is risky too. I'm surprised your lender is being so difficult if they know you have equity, so their money is safe. Would they let you take out a bigger mortgage to pay back the capital owing? I suppose you wouldn't be eligible.

@catipuss a bridging loan is an option.
They won't let me extend the mortgage or even port it to a smaller property.
They know I'm still ill (but insured). It feels very petty.

I'm really sorry to say this but you might need to take a lower offer than feels fair to get the sale over the line. I'm speaking in terms of getting the sale through only rather than looking at other options but if it is not selling then pretty much it:s price.

Could you consider selling by auction? A potential buyer messing you round is not worth much to you, you might do better to walk away and drop the price. Definitely don't take it off the market for anyone who hasn't sold their own yet etc.

Do they have any compassionate clauses in the contract round such serious illness? May I ask what the prognosis is for the person with cancer? Have you sought advice from cancer charities? I think Marie Curie might be able to advise on financial matters. You're not alone and I'm so sorry this is happening to you.

We own 25%+ of the house.
It's a big house. We had a rogue estate agent who cocked up the marketing. The new one is confident they'll sell.

Estate agents are always confident they can sell.

I think you do need to be prepared to accept an offer which will seem very low. As long as it covers your mortgage it will be better than the alternative.

Definitely speak to CAB and Shelter. You may also get support from cancer charities. You probably already have, but it's always worth trying again (sometimes a different person will be better/more knowledgeable).

Good luck.

They won’t allow you to extend the mortgage ? Add a couple of years on ?

No compassionate clauses!

If they would allow interest only I can afford it from early pensions and some small amounts of benefits. We can afford a smaller house with my partner's income and the equity but I got trapped in a estate agent contract whilst having a second surgery (unexpected). I was ill
Wed missed the market last year. I have paid in full the last two months and can do that for a another three.

Nope.
The even offer a interest only mortgage at 80% to value but I can't have it even though I have more equity.

Make sure you fully engage with the bank. Communicate frequently with the status of sale, show documentation where possible. Give them a timeframe and start preparing for moving by reducing anything like extra furniture or general stuff.

Most banks will not want to repossess but will need to act to protect their position, which is to get the agreed repayments. Is there any additional cash you can put towards the repayments?
Are you looking for a potential new property?

Are you single, have children?:

Have you been engaging with the building society because this is really odd. They want to help you stay in your home, and you’ve been making some payments, not completely stopped paying. Is this from conversations with them, or just letters you’re getting

@Matildatoldsuchdreadfullies I've knocked six figures off from the previous agents valuation.

I know it's being talked down by an agent locally as I didn't choose him. They're pretty competitive around here!

I get letters or emails every month.
I have a partner and an autistic adult DD who doesn't work as she's been nursing me.

I stopped paying for ten months as I had no benefits or believed I could get them. I've paid in full the last two months and will again this coming week.

Did you agree to stop paying with your lender (mortgage holiday) or just did not pay. The last couple of payments may have started to catch that up but you are still in arrears. Repossession process takes a while so unless it has already started you won’t be evicted just yet.

How much do you owe in arrears, and can you get a loan to cover that amount?

@LIZS I told them I couldn't pay and asked for a repayment holiday. They refused.
I asked for interest only, they refused. On part payments they've marked my credit file as missed payment not arrangement.

I've spoken to a solicitor and a repossession specialist. Shelter and our law centre.

I can get a bridging loan for the whole lot at 12% . My mortgage is now 7%.

Do you need to repay the arrears or the whole lot?

Your thread isn't terribly clear @Lucyweeks in terms of:
Amounts
Timeline
Communication with lender
Options investigated

Might be helpful to try to summarise.

Either I believe. My friend yesterday suggested I get a bridging loan for the arrears. I would essentially owe the same but one debt at 7% and the arrears amount at 12%.

I have a job offer but I just can't get better health wise.

At what point did you ask? When you first became unable to pay or when they chased you for the missed payments. Part payments will be “missed”. Even 7% is a steep interest rate currently. Could you commit to the payments at that rate let alone 12%

A year is a hell of a long time for any lender to allow a mortgage holiday; I believe the usual amount of time is up to about 12 weeks max for things like illness or job loss. So tbh, the building society have been more than reasonable if they’re only now pushing for you to pay the money owing.

I agree with others that the key thing is dropping the price to a point where you can sell quickly. It’s not what you want to hear, but what’s the alternative? And holding out for a high offer isn’t really any better anyway because all the while this goes on, you’re racking up more debt to the building society.

it’s very upsetting when something like this happens - sickness or job loss - but at least you have enough equity that you can downsize and still own a home which is a positive.

@newornotnew

The timeline is march last year. They originally issued possession proceedings after just six months. I had had a terminal diagnosis.
As before I'm insured for the full debt.
The judge gave me six months to sell.
This is about to expire. I don't want to give specifics on the full amounts as I have friends on mumsnet, but we lost our first buyer due to the chancellor stating £500k plus houses will be surcharged. They didn't want to risk it. I then had to have further surgery before Christmas and treatment in January. I'm now improving but not well enough to work in my profession.
My partner is not on the mortgage.