can they do this?

[Coney61]

Hi all, this is my first post and I'm hoping for good sound advice. My daughter, through no fault of her own I might add, had her apartment repossessed 3 years ago by the Halifax, it was in joint ownership with a friend. The repossession was done and she was asked to take the discharge letter into the main Halifax branch in Birmingham city centre along with the keys and she was told that was it. Last week she received a letter from the Halifax demanding £22K (as was her former flatmate) stating that it was the amount owed to them after they sold on the apartment. She has no assets now and is currently out of the country and won't return until May 2011.

She's due to marry in April 2011 and is afraid that the debt could be passed on to her husband to be. The question is what are her rights and could they claim the so-called outstanding amount from her husband to be even though the debt was incurred before she met him? Why has it taken them 3 years to decide that she owes them this amount of money? Any advice is greatly appreciated, thankyou.

[hatesdebt]

Firstly, I would ask for proof of the debt including any accounting to show how they arrived at the figure requested. Try not to admit to the debt in the letter though.

 

They can't make her new hubby responsible for the debt in any way - it's hers alone.

[coledog]

Agreed. She needs to get all the paper work from Halifax for before and after the repossession and put all this together. She needs evidence about how the repossession was handled by the mortgage holder and what they have done with the property, also any charges and costs they have claimed. If necessary you can send a Subject Access Request with a £10 fee to them.

 

Unfortunately, in repossession, they can sell the property for as much as they like and then chase you for the balance. There are strict FSA guidelines for handling repossession and you can take cases to the FOS if a complaint to the Halifax does not get anywhere

 

In my case I managed to sell my property but still had issues with the mortgage company - so am not an expert in this, I am sure others are.

[babybear39]

Her future hubby will not be affected by or linked to the alleged debt.

[firstship]

Halifax will have taken a dont care attitude,sell the home and get money back regardless of the current market value and there is little you can do about it..............Do not acknowledge the debt or start to pay anything,get a SAR,and be specific you require all data held including all data covering the re-possession with full detailed accounts of all companies or persons involved in the re-possession.There is a very good chance that you will find vague charges this I hope is the case and you can challenge Halifax,tell us how you get on............as other threads have indicated new husband will not be held responsible...............good luck.............FS

[coledog]

Contact FSA and get their Guidelines on how mortgage companies must handle mortgage arrears and repossessions then get together any documentation and information you can about how HBOS have handled this. HBOS are now under pressure to improve their finances which is probably why this has appeared.

 

My understanding is that if there is 'shortfall' after repossession it becomes a personal debt. There is a Forum on CAG for mortgage problems so it may be worth look at this.

 

The following is a good letter which you (or daughter rather) can send to HBOS -adapt to suit but you need all information relating to the mortgage account and subsequent request for payment. You need all statements and letters plus details of how they disposed of the property and why there is a shortfall. Send with a Postal Order for £10 and allow 40 days for them to respond. Tell them you want the info and do not acknowledge that any money is owed until you have this.

 

[your address]

[their address]

 

[DATE]

 

Dear Sir/Madam

 

ACCOUNT NUMBER: xxxxxxxxx (or multiple numbers if more than one account)

 

Please supply me with copies of all the data which you hold on me in relation to any matter and in any form and for any period of time.

Please note that I require disclosure of any personal data which you hold on me for the entire period of my dealings with you.

The Subject Access is not limited to my transaction history and it is not limited merely to 6 years of historical information.

Additionally, where there has been any event in my account history over this period which has required manual intervention by any member of your staff, or any other person, I require disclosure of any indication or notes which have either caused or resulted in that manual intervention, or other evidence of that manual intervention in relation to my banking business with you.

If you are unable to supply this data because there has been no such manual intervention, then please be so kind as to confirm this in your response.

I enclose the statutory maximum fee of £10. You have 40 days in which to comply.

If there is specific information which you require in order to satisfy yourself as to my identity, please let me know by return. However, please note that the above address is the one which you normally use to communicate my private business to me and which you have hitherto found to be acceptable.

 

Yours faithfully,

 

[signature]

 

[name]

[Coney61]

Firstly, I would ask for proof of the debt including any accounting to show how they arrived at the figure requested. Try not to admit to the debt in the letter though.

 

They can't make her new hubby responsible for the debt in any way - it's hers alone.

 

many thanks for your help, it's appreciated.

[Coney61]

Thank you for all the good advice, I will fire off an SAR straight away and see what they come back with. I'll keep you updated. Once again, many thanks.

[coledog]

You may be asked to provide them with id, proof of signature etc so take care if writing on behalf of someone else. This seems to be standard.

[sillygirl1]

Don't provide them with proof of signature or any other proof. They will be chancing their arm.

 

If the mortgage had insurances etc with it they will have claimed on them and are then claiming back from you at twice the rate.

 

Your friend has no actual liability for the alleged shortfall and can challenge the allegations - the mortgage company have to provide a lot of proof before the claim is justified in any way - ie valuations, sale price, disbursmentes from that (and they stitch you up something rotten - believe me, £4,500 management fee in my case.... almost ALL of the amount they claimed!)

 

The liability is now treated as an unsecured unsubstantiated debt and has very little priority.

[coledog]

SARs can be tricky as they can ask for proof - another poster was advised to say that they would collect the documents from a local branch where they would show some id to the staff.

 

Send the SAR but also a letter explaining that you (or whoever) dispute this debt and require all the documentation relating to the account before and after the repossession including full statements and breakdown of the alleged debt incurred as a result of this. You also need to get a copy of the original mortgage contract to see exactly what they think they were allowed to do under this.

 

Under FSA guidelines, they also had to do everything that they could to help the homeowner avoid a repossession, this is why anything that happened then is important and can support a complaint to HBOS and the FOS

[sillygirl1]

An SAR request is the wrong letter, you need to do a shortfall letter which is different, it lists the following documentation to be provided

 

1. Particulars of claim for court order

2. Copy of Judgement from court allowing repossession to happen

3. Copy of all correspondence between court order being granted and repossession, inlcuding telephone calls, faxes, emails, manual notes

4. Details of solicitors handling repossession (sometimes different to solicitors named on court form - one way to milk another £1000 from you)

5. Detail of all legal fees (you would be very surprised to see what they charge for.....)

6. Full statement from inception of mortgage showing all payments made and all fees/payments added or deducted by the company, inlcuding EXACT interest calculations

7. Copy of any insurances on the property

8. Details of any sale of the property and the disbursment of the sale price.

 

DO NOT DO A NORMAL SAR AS IT WON'T GET YOU THE ABOVE INFO

 

They will not want to give out the above info but need it to pursue it further through court (if they can - if they have done a money judgement and repossessed from that then they CANNOT do further enforcement via the courts.).

[Halibutt]

Good advice from Sillygirl.

 

I may be wrong, but I seem to remember a case where it was argued that the original mortgage lender had sold on the reposessed property at a fraction of the market value "for expediency". There was something about the resale being detrimental to almost all concerned and that the original lender should make up the shortfall between sale price and market value and use that to offset expenses.

 

Might be worth investigating. I'll see if I can find it anyway. Good luck!

[coledog]

Thanks SG - I bow to your superior knowledge! Do they need the original mortgage contract also as this sets out what they are able to claim/charge for? Also details of the acount at the time of the repo? I know in my case the mortgage company refused to take a reduced payment or 'holiday' but slapped on loads of charges etc. Just feel it is important to get all the ammo.

[Coney61]

Any advice on what to do is greatly appreciated, my daughter is having kittens over this and is talking about declaring herself bankrupt, her credit rating will be shot anyway now and she feels she has nothing to lose...any opinon on that SG??

Good advice from Sillygirl.

 

I may be wrong, but I seem to remember a case where it was argued that the original mortgage lender had sold on the reposessed property at a fraction of the market value "for expediency". There was something about the resale being detrimental to almost all concerned and that the original lender should make up the shortfall between sale price and market value and use that to offset expenses.

 

Might be worth investigating. I'll see if I can find it anyway. Good luck!

[Halibutt]

Firstly, bankruptcy costs the debtor. Yes, you have to pay in order to make yourself bankrupt. Not sure of the figure, but I have a feeling it's around the £750 mark.

 

Bankruptcy should be the very last resort.

 

I'd go with Sillygirl's advice (she's not that silly!) and see how you get on. Otherwise, maybe contacting the CAB would be a good move. They'll probably be able to give your daughter a rundown of the options available to her.

 

From the situation you describe, your daughter doesn't seem to have much to lose, but if she can try to make the best of a dodgy situation, I'm sure that people here will continue to help. Good luck!

[firstship]

Do not go for Bankruptcy,........Sillygirls advice is up to date,(did mine with SAR) make sure they produce a copy of every charge/company/person involved and a complete breakdown of each item,I am sure you will find some massive overcharges and doubtful charges..................which you can challenge............I wish you all the very best............FS

[coledog]

I am sure that you will find plenty to defend this - don't forget to get evidence of what they did with the property (SG) and how they handled the repossession issue. It is not easy to find anyone who is an expert in this area, you do have to do a lot of digging yourself. Have a look at FSA website and info for guideance about how repossession is supposed to be handled and check this against what HBOS have done. Write to HBOS for the info and tell them that you dispute this debt and require evidence of why they are bringing this claim. Ask for this to be treated as a complaint and if they do not provide an adequate explanation, you will refer the matter to FOS.

[Coney61]

I've managed to contact my daughters former flatmate and she is in the process of posting off this first letter to the Halifax. What's next? Thank you for your help, it's really appreciated.

 

An SAR request is the wrong letter, you need to do a shortfall letter which is different, it lists the following documentation to be provided

 

1. Particulars of claim for court order

2. Copy of Judgement from court allowing repossession to happen

3. Copy of all correspondence between court order being granted and repossession, inlcuding telephone calls, faxes, emails, manual notes

4. Details of solicitors handling repossession (sometimes different to solicitors named on court form - one way to milk another £1000 from you)

5. Detail of all legal fees (you would be very surprised to see what they charge for.....)

6. Full statement from inception of mortgage showing all payments made and all fees/payments added or deducted by the company, inlcuding EXACT interest calculations

7. Copy of any insurances on the property

8. Details of any sale of the property and the disbursment of the sale price.

 

DO NOT DO A NORMAL SAR AS IT WON'T GET YOU THE ABOVE INFO

 

They will not want to give out the above info but need it to pursue it further through court (if they can - if they have done a money judgement and repossessed from that then they CANNOT do further enforcement via the courts.).