Aggghhhh HSBC!!!!

[lavale]

I've posted on another forum, but was hoping for some advice from here.

 

I have a business loan with HSBC (£40k) my mortgage iswith HSBC. The business no longer is running - the HSBC want their £40k back(NOW) and as I have debenture - they will start repo proceedings if I don't.

 

I can't remortgage as my credit file is showing late payments on mortgage.

 

Any advice on how I can approach the HSBC?

 

(Pedross suggested I should ask for the amount to be added to mortgage as a further advance????)

[jansus]

Are you actually on an income that would support the increased mortgage?

[lavale]

yes

[pedross]

I've posted on another forum, but was hoping for some advice from here.

 

I have a business loan with HSBC (£40k) my mortgage iswith HSBC. The business no longer is running - the HSBC want their £40k back(NOW) and as I have debenture - they will start repo proceedings if I don't.

 

I can't remortgage as my credit file is showing late payments on mortgage.

 

Any advice on how I can approach the HSBC?

 

(Pedross suggested I should ask for the amount to be added to mortgage as a further advance????)

 

Right lavale this is how it works.

 

This site is brilliant, you need opinions in all sorts of different areas and there always seems to be an expert in the area you need. The exciting thing about this forum is that we all get opinions and we all give, just do not think that because it is free it has little value.

 

You just don't know who they are and how good they are. So you read lots of posts and decide which is the best opinion. But you just never know.

 

Sometimes, a real expert in your field who does not really want to get involved, reads your post because it just stands out to them amd cannot resist giving an opinion. In your case you are lucky because you now have two.

 

I have read replies by jansus and I have confidence in their knowledge so hopefully you will get an opinion soon. Sometimes you will read what you need to read rather than what you want to read. The problem is you will get different opinions from different people which is natural and does not mean any are wrong.

 

To the point: If you have sufficient equity I believe that HSBC will not just walk away from this debt. By all means negotiate and try to get them to reduce it but if you do not have the funds to settle it would appear from the limited information that they are the best people to lend you the money to settle it.

 

The reason for this route is if they agree it will get a bad debt off their books and turn it into a good debt. If they refuse and it goes to court you can explain what you tried to do and get the judge on your side. Whatever the result then as long as you keep up the agreed payments you keep the house - result.

 

Unfortunately, with free opinions no one accepts responsabilty and I am no different. If you are unsure seek professional advice from a qualified adviser.

[lavale]

Thanks.

I'm going to try and start to put something together today.

 

Do you know what the difference is between a charging order / debenture if any?

[pedross]

Thanks.

I'm going to try and start to put something together today.

 

Do you know what the difference is between a charging order / debenture if any?

 

A charge in your case would be the result of a debt guarantee which you have agreed to have secured against your property.

A charge is registered on the deeds of the property to prevent it being sold or refinanced without the owner of the charge being repaid.

 

A debenture is the traditional name given to a loan agreement where the borrower is a company. Typically, a debenture will set out the terms of the loan: the amount borrowed, repayment terms, interest, charges securing the loan, provisions for protecting and insuring the property etc., and terms for enforcement if the company defaults. Debentures are usually secured by charges on the company's property, but do not have to be ('bare' or 'naked' debentures). There are different types of charges. Debentures, as such, do not have to be registered, but charges securing them do.

 

It could be if it is a debenture then the debenture was secured against the companies debts but there was not enough money to repay the full amount. There may not be a charge at all which changes the position.

 

If there is a charge again it depends on the circumstances for example:

 

Consenting to a Charge on your property under pressure

 

In cases where one person, usually a wife has been pressured into signing a charge against their property as security, or acting as guarantor for the debts of their partner, (for example business debts), the courts have decided that the lender may sometimes not be able to recover their debt by forcing a sale of the property.

The courts may be willing to "set aside" a charge, (stop it from being enforced) if one person has entered into the agreement because of misrepresentation or pressure from a third party who is in a relationship of trust with the borrower. For example, a husband & wife, parent & child, boyfriend & girlfriend,

Where it looks as if the transaction, (agreeing to sign the charge) may not be to the borrower / guarantors advantage the lender must take steps to make sure the borrower or the guarantor is aware of the risks.

 

You really need professional or legal advice where all of the circumstances can be reviewed to ensure you get the right advice.

 

Pedross

 

Tip my scales if you think I have been helpful.

[lavale]

Thanks, so the debenture then would have been secured against the company's property (which there isn't - only our residential mortgage) It's my understanding that there are no charges on land registry details apart from the Welcome loan & obviously residential mortgage.

 

The debenture was secured against the companies debts but there was not enough money to repay the full amount. So I take it that there is not a charge. How does this change things?

[lavale]

Any recommendations on how I should compose my letter basically saying I can't pay in full by July 31st????

[lavale]

i've just got out my loan agreement. The security schedule states security: debenture

 

property/assets: fixed equitable charge over property; fixed charge over all book and other debts, goodwill and uncalled capital; floating charge over all other assets.

???????

[pedross]

I take it that it was a Limited Company and it is in liquidation.

 

In which case it is probably just a standard debenture they normally use.

 

Without knowing how far the communication has gone you need to acknowledge their letter and ask them for a breakdown of the amount if you do not already know what it is.

 

If the debt was £40k and there was nothing at all left over for them then you might already have a breakdown. If you are sure that £40k is correct write to them and explain that you cannot possibly pay the money by 31st and ask them to suggest a possible solution to enable you to attempt to resolve the matter.

 

From the information you have provided this would be the first move. If you are keeping in contact they will be more reasonable (hopefully) it is when you ignore them they get desperate.

 

The answer to your previous question is that as there is no charge they cannot repossess your home on this debt alone unless they get a CCJ and then get a charge or file for bankruptcy. If you comunicate then you should be able to resolve it.

 

Pedross

[lavale]

It was originally for £90k. I got some money for selling & that went to them direct. the £40 is what was not covered from the proceeds of the sale. The business was not put into liquidation as there weren't enough funds - it has since been dissolved though

[pedross]

In that case point out that you have already paid off more than 55% of the debt which you feel is reasonable in the current climate for a failing business. Then ask them to take that into account and ask then to suggest a fair proposal to resolve the matter.

 

Just one major point which I did not consider with the information arriving in bits. Did you give them any type of personal guarantee or have they just got the debenture. If its just the debenture then look for the section which puts the liabilty onto you. Is there one?

[lavale]

Yes, sorry for the dribs & drabs....

 

I like the 1st point - that's good.

Unfortunately both my husband & I are joint guarantees

[jansus]

I agree that it would be worth trying to see a solicitor that deals with business matters to check exactly what you signed and what you are actually liable for before starting negotiations.

 

Do you have full copies of all the original documents that you signed for the bank?

 

Was there a section stating that they advised you to get independent legal advice at the time - and what have they put as your response?

 

If you go to a solicitor who specialises in this type of law you could get probably 1/2 hr free consultaion and if you have all the documents they should be able to advise you how much their services cost or whether it is a straight forward case of , yes all the agreements are ok and you are liable.

 

Then yes I would try and negotiate a reduced figure - and add to you mortgage - or you have to wait for them to take you to court and adhere to the courts decision.

 

I am no expert in business law - so I can only tell you what I would do - and that would be first to double check all the original agreements are watertight ( not that I dont trust them or anything:))

 

Then try and appeal to the banks common sense - settle as soon as you can to stop the interest charges mounting up too fast and if I was the bank I would appreciate you offer to increase your mortgage as at least then they would have some security for the loan.

[pedross]

I think this is good advice from Jansus and considering what is at stake it would be beneficial to get a solicitor to assess the strength of their argument.

 

My post 6 has some information regarding the signing of a guarantee but it is more involved than the post goes into and a solicitor face to face and looking at the agreements may give some good advice.

 

Then, of course, we give you our opinion about what he says!