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Possible repossession if two properties become one?
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For more on marking an answer as the "Best Answer", please visit our FAQ.The way I see it is ... at the moment it is two separate properties. Your neighbour's house could be repossessed if they defaulted but yours would remain untouched of course because you are a totally separate person. However if you bought their house as a separate house then the mortgage would apply just to that house and could be repossessed like any other. However, if you then bought next door and changed the title so that it was all one property then the mortage would then apply to all of it and therefore the whole property could be repossessed as you have changed it into one thing. So I think it would all depend on whether you merged the one property into a single dwelling or kept it as two. I think it would make good financial sense to buy it, you could even rent it out and keep an eye on it and make a nice income, or have a nice big house as you say. I wish I could afford to buy my next door !
However, they could repossess part of it (which they havea charge over) and instruct builders to convert it back to one dwelling.
It is also worth noting that I have done this on a commercial scale and the finance company who financed the second building took a second charge over the first buihding.They needed permission to tkae a second charge and when they told the first charge holders the reason, the first charge holders on the first property demanded a second charge on the second property as well.
Hope his makes sense. To try and clarify - whilst in your example only part of the building could be repossessed, your example is unlikely to happen - they will want a charge over both parts.
*Note where I put the word charge you can replace this with the word mortgage. if that is easier.
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