How much is a reasonable Contractual Monthly Payment+Arrears Offer?

[Nobbin]

Hi

 

I'm hoping you can help my sister with this quandary. She has some mortgage arrears for various reasons but they are now wanting to sort this issue out. A court hearing has been booked but her mortgage company have called and said they are willing to help and look at options. The arrears are around £5800.

 

Going forward they can pay the contractual monthly payment plus an amount towards the arrears. The mortgage company say they will consider this but a i and e form must be completed. So I'm trying to help her work out what might be seen as a reasonable offer

Their income is £2700 pm and essential dd etc including mortgage is £1715. On top of that we've allowed for food and a few other bits.

 

So the remains non essential balance pm is £500. How much of that should she offer and leave herself for entertainment, unexpected expenses etc which would seem fair to mortgage company or potentially a judge.

[Nobbin]

Forgot to add they will be in a position to make a lump sum

Payment of £625 towards the arrears this month and next month in additional to the mp

[Andyorch]

Whats " camp " Nobbin ?

 

Andy

[Nobbin]

God sorry, my phone corrected cmp - contractual monthly payment.

[renegadeimp]

Who is the mortgage company

[ericsbrother]

also, how long is the remaining mortgage period and what was the original length?

[Nobbin]

I believe there is around 12 years left to run of a 25 year term

[ericsbrother]

then if she can afford the uplift in payments over that term it would be simplest to have the whole amount commuted to the mortgage rather than busting a gut to pay off and extra £500 a month for a year. An extra £60 a month for 10 years is not crippling. getting them to agree to this is the tricky bit, they will most likely think that she may well slip back into old habits sosomething will be needed to be done to persuade them otherwise. They may well agree but want an arrangement fee of some extortionate amount added as well. The bad news is the court application hanging over her gives them the good cards. If it is more than a month away then she should pay off some of the arrears without being asked and then make sure the next regular payment is met. This will steal their wind a little and make them more likely to accept the most obvious method of going forward.

Mind you a lot will depend upon why the arrears mounted up in the first place and what the mortgage co were told at the time, if anything. Just not paying it because she had a nice holiday in the Maldives instead wont make them feel like spreading the amount owed over a long time.

[Nobbin]

As the poor family haven't had a holiday in three years, they could only wish for a Maldive trip at this point sadly. It was due to a combination of urgent house repairs, a serious car problem and her children starting secondary school. A perfect storm of circumstances that would be very unlikely ever to occur again.

At the moment the plan is to be able to pay thebusual monthly amount ongoing. In December she is paying an additional £650 towards the arrears unasked for and will do the same again in January. Then on Feb/March to clear as much as she can. However from the figures I mentioned above would £100 or £130 per month towards the arrears

Seem reasonable. I don't think they want to add it to the term

And would rather clear it over the next year or two.

But are those figures reasonable ?

[Nobbin]

Just to clarify they aren't looking to offer the £500pm. There is £500 per month available left after food and bills. We are looking to work out what would be a reasonable offer to make to clear the arrears from that.