Negative equity – forced to repay mortgage

by Readers Question

12:56 PM, 4th October 2013
About 6 years ago

Negative equity – forced to repay mortgage

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Negative equity – forced to repay mortgage

I have a buy to let mortgage with Mortgage Express. This mortgage finishes in April 2015. The value at present of the property is around £50000. I paid £126,000 for it 6 years ago with a mortgage of £113,500. There is now negative equity in the property in the region of £76,000.

I have paid the interest on the mortgage consistently and the property has been let at a fair rent allowing the mortgage payments to be met.

I have asked Mortgage Express for an extension of the term to allow equity to build in the apartment so as to give me a chance to sell it and redeem the mortgage. Negative equity - forced to repay mortgage

I have asked Mortgage Express to allow me to overpay and they have agreed, however I don’t want to overpay to find that I am made bankrupt due to their unwillingness to extend the mortgage in April 2015. There will be a shortfall of £45000 even if I over pay £1000 a month.

I earn a good wage and can afford to overpay by over a £1000 per month.

I have also written to the Prime Minister who has given the treasury my letter who in turn have responded. They say tackle the case with the Financial Ombudsman. My past dealings with them seem to be that they are weak to say the least.

It seems unfair that due to no fault of my own, indeed the financial crisis of the country being the cause and the disastrous dealings of the banks being responsible, I have to be responsible and accountable instead of the perpetrators.

Any suggestions?





16:08 PM, 7th October 2013
About 6 years ago

Reply to the comment left by "Puzzler " at "07/10/2013 - 12:04":

Thanks for your support, the mysteries of the world are so confounding!

Mark Alexander

16:58 PM, 7th October 2013
About 6 years ago

Reply to the comment left by "DAVID KNIPE" at "07/10/2013 - 16:08":

Hi David

If this is a genuine cry for help, which I am now beginning to doubt, please answer the questions raised by readers here.


17:11 PM, 7th October 2013
About 6 years ago

Reply to the comment left by "Mark Alexander" at "07/10/2013 - 16:58":

I don't accept your comments as correct. Of course this is a genuine cry for help. As I have indicated so far, nothing has been said that I have not been aware of over the past 2 years.

Please tell me why you are beginning to doubt me. I work all God's hours and have little time to mess around and spend time unnecessarily.

No point in answering questions which have already been answered. I have thanked all concerned for their support.

The question of an 8 year mortgage is what was sold to me. The devaluation of the property is what it is now......there is no reason for it just that demand is not there. Quite obvious I would have thought. However, I do reiterate that I am very thankful for everyones concern.

I am not happy, however, with your comments and am not really happy that you have a lot to offer.

Thanks for your support so far.

David Knipe, FCCEA, AMIA, MICB


17:34 PM, 7th October 2013
About 6 years ago

Reply to the comment left by "Mark Alexander" at "07/10/2013 - 16:58":

Sorry Mark but I really don't have enough hours in the day to relate to this forum.

Pity as some of the people were very kind and willing to help.

Pity I cannot justify what is to them.........thanks for all your efforts.

Not quite sure where you are coming from though......joyful in turmoil that's me.

Mark Alexander

17:58 PM, 7th October 2013
About 6 years ago

Reply to the comment left by "DAVID KNIPE" at "07/10/2013 - 17:34":

In that case David I am unable to add to the advice and contacts I offered in my initial responses.

I wish you well.

Steven Burnell

18:38 PM, 7th October 2013
About 6 years ago

David, I'm not clear what you were hoping for. The situation you described is very unusual & warranted clarification. People may have commented differently if, for example, you had been mis-sold the mortgage or if the dramatic loss of value had been caused by structural problems that ought to have been discovered in your pre-purchase survey. However, if your situation has no direct cause / fault other than poor judgement or plain bad luck then I'm not sure what help you need. But, maybe you can still get some useful expert advice from Mark's contacts? Best of luck!

Paul Morgan

17:31 PM, 7th April 2015
About 5 years ago

We bought a property in 2006 in South Wales which we have been letting ever since.
The original aim was to repay the mortgage either by selling or capital from our other developments we were involved in at the time. Sadly we caught a cold in the crash of 2008/9 and weren't able to do this. Now the property is worth around £60k (in South Wales) and the £70k BTL mortgage with Bank of Ireland, (formerly Bristol & West) ends in December 2015. In summary we are £10k into negative equity with no means of repayment. We wrote to Bank of Ireland requesting a term extension for say 5 years to allow the value to recover; the account is paid up to date and we have a good tenant. The rental income is £375pcm with mortgage interest of £130pm payable. Bank of Ireland said no, pointing out that it was our risk, not theirs.
Not particularly helpful.
Should we pursue them further? Any suggestions please?

Colin Dartnell

0:17 AM, 8th April 2015
About 5 years ago

Not at all sure why anyone would take out an 8 year mortgage, take it out for 25 years then overpay later if you want to shorten it. Any good accountant knows that.

Paul Morgan

22:05 PM, 8th April 2015
About 5 years ago

Hi Colin. I should clarify that it was a 10 year term from December 2005; Bristol & West, (now bank of Ireland) wouldn't agree to a longer term because of my age, so I had no choice on that one!

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