The Mortgage Works Won’t give me a redemption figure – Please help!

by Readers Question

11:08 AM, 24th April 2014
About 6 years ago

The Mortgage Works Won’t give me a redemption figure – Please help!

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The Mortgage Works Won’t give me a redemption figure – Please help!

Hi all,

I exchanged contracts on a flat I am selling on 11.4.14 with completion set for 17.4.14. It was not certain that this would go ahead until the last minute, so my solicitor didn’t request a redemption figure until then. Unfortunately, the mortgage on this flat is a portfolio mortgage with one other property. The Mortgage Works are insisting on revaluing both properties before they calculate the redemption figure for one! Their time span for this is 21 working days, I now find out. They have had the valuation back on the property I am selling but not the other one, which they say they do not expect until 30.4.14.

My buyers have very tolerantly agreed to an extension of a week with completion taking place on 25.4.14, but I can’t even make this now. Each time I have rung TMW I have been given different information, each time suggesting the answers would be ready by the next day.

My solicitor says that whilst he would not recommend it we could complete and he will hold the proceeds until we get the figure.

What I need to know is: how will TMW work out the redemption figure? If it was simply the amount outstanding on the mortgage there would be no need for the valuations. I assume they will add the values together and make sure the other property still has the same LTV or less. The original LTV on these products was 85%. There is enough equity in both properties for the LTV to now be 75% and still give me back the equity in the flat I am selling. I have never missed a mortgage payment or in any way upset them. No one I am able to talk to at TMW appears to know this.

Any suggestions – I’m getting just a bit desperate…

EdnaHelp



Comments

Neil Patterson

11:32 AM, 24th April 2014
About 6 years ago

Hi Edna,

We may have some broker/IFA readers with more insight but we do get more involved with purchases than sales normally.

Your Solicitor is wise to be cautious, because you have very little information at this stage.

You probably can't do anything about how long the second valuation is taking at this late stage so communication is key here and do not give up. Take notes of every conversation and the name of who you spoke to.

I would try the sympathy route first and explain your circumstances and that you desperately need to know what LTV and rental income they are happy to be left with. That way you can work out yourself fairly accurately whether you have a problem or not with completing.

They must be able to do this for you and if they are not helpful then say you want to make an official complaint. Use those exact words to instigate the complaints procedure and say you want to speak to the complaints department now.

Be professional, polite, very persistent but do not take no for an answer and you probably will not get as far as a complaint.

Unfortunately this is a lesson for anyone with a portfolio mortgage that redemptions are not always that simple.

I hope this helps fingers crossed.

Jeremy Smith

12:12 PM, 24th April 2014
About 6 years ago

What stops them from grabbing the whole lot to pay down your borrowings, like I have heard alot of lenders are tasked with, and reducing your LTV on the other property to, say 50%, ?
....Although I have heard that TMW are lending, so this won't be the case, I hope.

Why on earth did they need a valuation on the one you are selling, surely just the remaining one, to calculate your remaining LTV ?
You know exactly how much you are selling it for, how much will be raised, and the only remaining question is how much are they willing to let you owe on the other one.
- I suppose it is for the proportion that was borrowed initially on both, but this data they would have had from the commencement of the loan.

Mark Alexander

12:44 PM, 24th April 2014
About 6 years ago

I had a similar problem in 2010 but my properties had fallen in value. They wanted more than 100% of the sale proceeds to reduce the LTV'S on the remainder back to LTV. The sale improved the overall position by around £25k so after a bit of negotiation we settled on them retaining 100% of the sale proceeds. I was happy with that as that was my plan anyway. The remaining properties have since recovered in value. My view is that TMW are fair and reasonable but may need some persuasion to override what the computer says.
.

Mike W

13:50 PM, 24th April 2014
About 6 years ago

Edna,

I went down a similar path in 2012. Suffice it to say I was in a better position in that I had told TMW in advance of the sale date. However despite this TMW provided the redemption figure outside the actual sale date. Then required a second valuation - which they did not do!! - They are TOTALLY inflexible on this. It is a clever way for them to hang on to your money. I discussed the matter with Mark later because I reported TMW to the ombudsman. I lost over £1800 in extra solicitor fees and lost interest. I won on the first adjudicators award but TMW then appealed to the ombudsman and I was only awarded £300. They then did not pay me so I made a further complaint and got an additional £50.

If you read the rule book carefully they will require the most money back - either the sum you borrowed on the property or that sum plus a further sum if the other portfolio property has fallen below the 85% (or whatever original %) that you received on it.

In my case the valuer was incompetent. He valued the remaining house at £185000 - its original purchase price - and referenced the value to 3 2-bed flats about 2 miles away. My property was a 5 bed terraced house, listed, in a conservation area and on Zoopla (which I find is usually a good indicator) it was valued at £285000 - based on area inflation statistics. In other words the zoopla figure did not take into account upgrade work. TMW refused to provide the details on the valuation in writing.

Also if you read the small print TMW charges interest in advance!! In other words be very careful of when you make the payment to release the loan charge. You could end up paying a months interest on the money you have paid them.

Finally my case rested upon the fact that TMW claim to provide this 'return of property' figure (NOT a redemption figure) in 15 - 20 WORKING days. In my case they did not. They provided the figure after only 10 working days and it is only valid for 30 days FROM when they issue the letter. In other words less postage time. So it did not cover the sale date - it expired early!! The second time I requested a figure they took 31 days to produce it. So it is IMPOSSIBLE to get a letter from them to meet a specific date.

As you can imagine there were a lot of phone calls. I requested transcripts of all calls. But of course TMW did not provide a transcript of the original call in detail - missing out the bit where I gave them the date. They also did not provide transcripts of later calls either. Luckily I had recorded the calls.

If you want details - including a detailed complaint made to the ombudsman, ask Mark for my email address.

The ombudsman took over 18 months to provide a decision and in the intervening period I had further complaints about mistakes on the account. Incorrect statements, incorrect charges, and an accusation that I had not made a payment when TMW had not executed a direct debit.

In short good luck!

Sian Wyatt

14:58 PM, 25th April 2014
About 6 years ago

Thanks for your comments. My incredibly understanding buyer, who is also a landlord, has agreed to a further three week delay on payment of a fee towards the loss of rent expected etc. I am very grateful as I was extremely worried about what was going to happen.

In the mean time I have continued to keep ringing TMW. On Wednesday I was told the valuation on the property I am selling was back, but the other one wouldn't be back until the 30th April. Yesterday I was told actually they didn't expect it until May 7th...

My solicitor confirms that he requested the figures on 8th April, so 20 working days takes me to 9th May. I asked for confirmation I would definately have the figures by then and the response was an unreassuring 'should do'.

I am reluctant to make this an official complaint and risk involving even more red tape. They did assure me that whatever the original loan to value had been would be kept on the remaining property, but when I pointed out that would mean giving me a further £35 - 40k they didn't seem so sure...

It would be nice just to talk to someone who knew what they were talking about and would give me a straight answer... oh, and some money.

Edna


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