If you are living in a shared ownership property and you are having difficulty paying your rent and/or service charge or your mortgage, you should contact us and your mortgage lender immediately. We have a Financial Responsibility Team who may be able to advise you on benefits you may be entitled to or refer you to another agency for more help and advice. If you are experiencing financial difficulties please call the Financial Responsibility Team on 01935 404050
If you fall behind with payments of rent and service charge, we will contact you and discuss the problem. If you cannot repay the debt immediately, we will consider payment by instalments.
We hope for your co-operation in making arrangements to clear arrears and to maintain these arrangements. Your mortgage lender will also try to help you in these circumstances. If you fall into serious arrears with the rent or the service charge, you may lose the right to pay by instalments and the whole amount will have to be paid. If you fail to keep to your arrangement to pay your rent and/or service charge, then Yarlington has the right to take any necessary debt recovery action. This may include approaching your mortgage lender who may choose to pay the arrears on your behalf. When this happens, the money paid is added to your mortgage debt. Interest is payable to the lender on the increased amount outstanding.
We will always seek to avoid taking action to repossess your home for failure to keep up payments. However, if there is no alternative and we have to repossess your home, we will offer you advice and help about re-housing.
Borrowing more on your mortgage
If you are mortgage dependant and you wish to re mortgage releasing some of the equity in your home you should get advice directly from your current lender (building society or bank), or from a mortgage broker or financial advisor registered with the Financial Conduct Authority. Your mortgage company will need to obtain consent from YHG first. YHG will only consider permission for shared owners with a clear rent account and no outstanding action against their lease.
YHG will require a copy of the new mortgage offer from the lender and confirmation from them of the current valuation of the property. Should the buyer intend to borrow extra money, YHG will need full details of what this is for.
Your lease sets out clear guidelines advising what you can and can’t borrow more money for, please refer to the terms of your lease for guidance on this. You will only be permitted to re mortgage and borrow extra money on the following grounds:
- To staircase and buy further shares in your hom
- To buy a joint leaseholder out of the lease such as in the case of a relationship breakdown.
- To carry out substantial and essential maintenance work to your home, so as to enable you to comply with the covenants of your lease, ensuring your home is kept in a good state of repair and decorative order.
The Mortgage protection clause (MPC) within your lease gives protection to your lender in the event of any repossession action. Lenders usually require confirmation from YHG that any extra money they lend will also be covered by the original MPC. In line with government guidelines, YHG only extends the MPC to extra borrowing that's listed above. Many Lenders will not approve a shared ownership remortgage to consolidate debts for this reason.
Detailed below are items that will not be covered or permitted within your lease under the MPC:
- Debt consolidation
- Mortgage arrears consolidation
- External home improvements and garden landscaping
- Buying vehicles
- Gifts of money
- Equity release