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Repossessions loophole exposed
Chorley property owners are being warned about a legal loophole that allows homes to be repossessed without court action.
Staff at Chorley's Citizens Advice Bureau say they have seen an increase in the number of people having their buy-to-let homes repossessed with very little warning.
They are now joining a campaign to have the legal loophole closed and are speaking out to warn other people about the pitfalls.
Val Rawlinson, a housing and homelessness advice specialist at the bureau, said: "The majority of borrowers with mortgage arrears will have lenders who are working in line with the government's most recent pre-action protocols for mortgage arrears.
"However, I have recently handled a case that highlighted a loophole which some lenders are using to effectively by-pass the court system.
"The client had a buy-to-let mortgage with a building society and they fell into arrears due to a difficult tenant failing to pay rent.
"The client reached an agreement to clear the arrears, but the offer wasn't accepted by the building society and the locks were changed on the property.
"The lady sought advice from Chorley MP Lindsay Hoyle and from a solicitor and came to the bureau when all other options were exhausted.
"Because the property is financed through a buy-to-let mortgage it was classed as a business and so, in essence, it was put into receivership."
The Chorley landlord faced having her 135,000 property repossessed because she owed 1,100, but thanks to the efforts of the bureau she has been handed back the keys to the property after paying back the debt and six months of mortgage payments.
The client had sought advice from debt counsellor John McCullagh who said: "The problem only came to light in January 2009 when the property owner got a letter from the receivers saying that they were taking the house back.
"I was shocked at how quick things could happen and although she offered to pay all of the arrears and more, the building society wouldn't accept that.
"Val managed to collate evidence and she wrote to the building society and managed to sort the problems out."
Staff at Chorley's Citizens Advice Bureau said they have witnessed a big increase in the numbers of people using their services as the recession takes hold.
They have issued a guide offering simple steps for people with mortgage trouble which is available from the Fazakerley Street office.
If you would like more information or if you think the bureau could help you, contact them on 01257 232138.
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Weather for Chorley
Thursday 24 May 2012
Today
Sunny spells
Temperature: 12 C to 24 C
Wind Speed: 9 mph
Wind direction: North east
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