kevpam

HI my Inlaws left a 8 months ago to move back to South Africa .They have a flat in London which was rented to cover the Mortgage and the personal loan repayments .But the tenants have stopped paying the rent and the bank have started to send letters .They are unable to make payments from South Africa as it 13.5 to 1 Does any one know what would happen now ?will they try and clam the debt in SA

Fly Away

Sorry to hear this Kevpam.

Can I just ask is this a buy to let mortgage or a normal home owner loan? If it is a buy to let then your parents should tell the mortgage company exactly what is happening. The mortgage company will hopefully be understanding and wait until the rent arrears have been paid.

Is the flat rented through an agent? If it is an agency, they should be able to pursue the debt for you. If not, you can chase the debt through the courts.

If it is a home loan, your parents should act quickly to chase the arrears / evict the tenant and get a new one. Every UK short hold tenancy agreement must allow the landlord to give the tenant 2 months notice to leave. That's the nice way to regain possession. If there is no tenancy agreement, you are in a tricky position and need to seek further advice on the legal way to proceed.

Sorry I haven't been much help.

Jan4kids

I'd say get another Tenant in quick smart!

Good Luck

kar-kier

I'd agree about getting another tennent, but as I understand, there is currently a tennent in that isn't paying, and would take 2 months at least to get out.

As far as i'm aware, no they would not try to recover the debt in SA, as it is a consumer debt, therefore on valid in the country signed. However, theoretically they could reposess the house if non-payment continues!

hoofie2002

They need to get moving NOW to get the tenant out. It will cost them but there is no way to avoid it. Surely they had an agent looking after it for them ? They need to contact a UK solicitor and get the ball rolling as quickly as possible. The law in the UK gives tenants a lot of rights so it needs to be done properly.

The bank needs to be contacted and told also that the tenant is in arrears and the eviction process is being followed.

kevpam

Hi thanks for the info It is a insrest only mortgage and not a buy to let the bank would not give them a letter to rent it out .they have contacted the bank (northen rock ) and they can not help the biggest problem is that they are in negitive equety with the property and the personal loan is unscured .They rented the flat privately.they have given the tenants notice but i 2 months they will be 5 months behind in the mortgage payments and the personal loan .They are now not worryied about lossing the property there concern is that will they get CCJ against them in South Africa .Any advise or personal experince would be appppreciated thanks

Fly Away

Sorry to hear it is so complicated. Do your parents still want the property????

If they don't then get them to put it on the market asap at a bargain price. If they are lucky they may get a low offer - which the NR may accept in total payment for the loan. After all, it isn't their fault that the property market nosedived. The NR may also suspend mortgage interest if they think genuine efforts are being made to sell the property.

The none secured loan is well non secured.... nothing to do with the property. Get your parents to renegotiate the terms of the loan if they have a problem paying it.

To be honest, it will be years before property prices get back to last years values. Your parents will not get their deposit back for a long time and they could just be throwing good money away if the flat is untenanted for long periods of time.

kar-kier

Rest assured whatever happens it will have NO EFFECT on their life in SA. That fact they don't actually have permission to rent out the house puts them in a VERY awkward position - they've been told no, but still did it! Add on the fact they are in negative equity, it does not look good at all! Maybe the best bet would be to have the house repossesed - it would at least take the worry away, not like they have got anything to lose!

hoofie2002

Considering the fact that it is interest only and they are in -ve equity plus months behind in the mortgage, it is pretty well 100% guaranteed that the bank will commence repossession proceedings against them. Unless they can come up with a large chunk of money very quickly to keep the bank away it looks like it is game over. If the bank finds out it was rented out then they have grounds to cancel the mortgage and demand payment or realise their security to start with.

They could try and sell it but in the current market they have no chance of getting a good price [especially if it is a new build] and the bank may well refuse to allow the sale and commence reposession if the possible sale value is dramatically below the outstanding mortgage since they may guess that their chances of getting back the difference are zero.

As to whether the bank would commence proceedings in South Africa ?? I doubt it unless there is a lot of money at stake and your parents have lots of valuable assets - and that's before any consideration of whether the bank has a legal case.

jamesanding

Do you know anyone in London? If so get them to go round to the house and find out why the rent is not being paid.
Where in London is the property?

Jen1977ni

Aye, send the heavies in! RARRRRRRRRRRRRRRRRR

Joking....tee hee but yes, I agree, good thinking batman!

kevpam

Unfortunatly they have no one in the uk they will have to let the bank take it they are wooried that they myte get an attachment on there South African salarys has any one experineced this or similer