From: "DaveJ" 
Newsgroups: uk.legal uk.finance
Subject: Re: House Reposession 'Rescue' - Is This Legal and Sensible?
Date: Tue, 6 Sep 2005 15:55:42 +0100


"sharky"  wrote in message
news:3o5l9mF483itU1@individual.net...
> Maria wrote:
> > A friend is going through this as the moment - I just want to make
> > sure it is legal and sensible, as they refuse to use a solicitor as
> > they say they can't afford it.
> >
> > They have a first mortgage on a house worth around £150K, and they owe
> > £103K on the mortgage.
> >
> > The house has a repossession order on it because they couldn't/didn't
> > pay some payments.
> > They have had it up for sale for some time, but no joy.
> >
> > They were due to be chucked out today, but a company has come to the
> > rescue.
> >
> > The company have 'bought' the house for £150K, except that they
> > haven't bought it exactly. They have paid off the original lender
> > £103K.
> >
> > The repossees get nothing at this time, and from now on, they pay this
> > company £550/month to live in the house, like rent.
> >
> > In three years time, if the repossees want to 'sell' proper, they will
> > get some of the £47K profit returned to them, less £6000 commission.
> > I don't know what happens if they decide to sell in 10 years time
> > because the couple don't seem to really understand what is going on
> > here.
> >
> > Is this a good deal or what? I can't quite work it out!
> >
>
> Depends on who values the house in three years and who is allowed to buy
> it! They might well find that the small print says that the company will
> value it and give them only eg 66% of valuation - so they will get
nothing!
>
And in the meantime, they've paid nearly £20k interest and will have a
'completion fee' of £6k on top. If none of you can understand the deal, I'd
guess it's unlikely to be a good one...