Loan - Stat Demand, secured now County Court?

[MarathonPaul]

Hi All

 

I took out an unsecured loan several years ago and failed to keep up payments shortly after taking it out.

 

I received a Statutory Demand from the loan company.

 

 

Under the threat of bankruptcy proceedings and after contact with the company's solicitors,

I agreed to have the debt amount secured against the property.

 

Today, five years later, I have had contact from the loan company again.

This time a default notice with a threat of County Court action if I do not pay the amount due.

 

I believe the reason for this contact now is because my mortgage lender recently secured a suspended order for possession on my property

(this is something the loan company would have been aware of, of course, ad they are notified of the proceedings because of their interest in the property).

 

I am keeping up payments under the suspended order, so there is no danger of the property being repossessed.

 

Can anyone hazard a guess what the loan company is looking to achieve here?

Are they merely looking to scare me in to contacting them and agreeing some sort of payment plan,

or are they about to pursue a case in County Court to force a sale of the property?

[unclebulgaria67]

If they are not the main creditor, I don't think any application to force the sale would work. Your mortgage company might also wish to challenge as well. It depends on what charging order they have I believe, as my understanding is that these are at different stages. Some CO's will allow the sale of the house, with just notice sent to the creditor after the sale of the house and other CO's require the permission of the claimant before the house can be sold. IF this is the case, the loan company may just wish to change the status of the CO, rather than try to force the sale of the house.

 

Write back saying that you don't understand the intention of their letter and ask them to explain why the letter has been issued.

 

This post may be better in the legal forum.

[citizenB]

Yes, I agree.. moving to Legal issues.

[citizenB]

Have you been maintaining payments to the loan company?

 

I am not quite sure why they would have issued a DN if you have been.

[MarathonPaul]

Hi

 

I have not been maintaining payments on the loan, never did....

 

so they issued stat demand few years back, i agreed to let them have a charging order rather face bankruptcy!

 

I think they were happy with this outcome, ie just wait for me to sell the house one day, then they get their money!

 

its been a good few years now, and i haven't sold, maybe they want to do something about it now?

[citizenB]

Ah, righto.. I imagine they are tired of waiting for you to sell.

 

They are not really thinking about this, it is likely that any forced sale would not provide them with the resolution they require eg their money back. Property prices are low and your mortgage provider will be the 1st in the queue.

 

Did they confirm any agreement regarding the securing of the debt on your property, in writing ?

 

Would you be able to perhaps come to an arrangmeent whereby you start to repay something off the debt each month ?

 

On securing the debt against your property - was interest frozen or did that continue to be applied ?

[MarathonPaul]

Ah, righto.. I imagine they are tired of waiting for you to sell.

 

They are not really thinking about this, it is likely that any forced sale would not provide them with the resolution they require eg their money back. Property prices are low and your mortgage provider will be the 1st in the queue.

 

Did they confirm any agreement regarding the securing of the debt on your property, in writing ?

 

Would you be able to perhaps come to an arrangmeent whereby you start to repay something off the debt each month ?

 

On securing the debt against your property - was interest frozen or did that continue to be applied ?

 

Interest is frozen, and has not been added (the number mentioned in the DN just now is exactly the same as it was in the CO five years ago).

 

No agreement was put in place in wriiting, the solicitors simply wanted the charging order.

 

There is equity in the home, £200k or so, maybe this is why they are gunning for me?

 

Would a District Judge order a forced sale if they applied for it? .......I suppose what I am really asking here is does a unsecured loan that became secured carry the same weight in law as a mortgage that was originally secure?

[unclebulgaria67]

I think if the loan company ever did try to force the sale, I would contact the legal people at the mortgage company, who would probably tell the loan company to stop or they will be jointly defend the application.

 

My opinion is write back saying that you don't understand their letter and could they explain their position fully. Advise them that the first creditors, the mortgage company continue to receive their payments and that there are no current plans to sell the house.

[MarathonPaul]

I think if the loan company ever did try to force the sale, I would contact the legal people at the mortgage company, who would probably tell the loan company to stop or they will be jointly defend the application.

 

My opinion is write back saying that you don't understand their letter and could they explain their position fully. Advise them that the first creditors, the mortgage company continue to receive their payments and that there are no current plans to sell the house.

 

Forgive me for saying this, but that doesn't quite make sense. Surely if the loan company can force a sale then that is in the interest pf the mortgage company too, as they get their money back even sooner on what has clearly been a troublesome mortgage(suspended order etc)...am I missing something here?

[42man]

It seems clear that the loan company aren't happy with having the security without getting any repayments back in the meantime, and yes they can and (from what the latest letter says) will apply to repossess, with another mortgage provider also having an interestthen it could become a difficult situation as they will both be adding a huge amount of legal fees / charges to swallow up what equity you have. Are you able to make any repayments to the loan company ?

[Ganymede]

I think if the loan company ever did try to force the sale, I would contact the legal people at the mortgage company, who would probably tell the loan company to stop or they will be jointly defend the application.

 

 

 

Not possible.

[MarathonPaul]

It seems clear that the loan company aren't happy with having the security without getting any repayments back in the meantime, and yes they can and (from what the latest letter says) will apply to repossess, with another mortgage provider also having an interestthen it could become a difficult situation as they will both be adding a huge amount of legal fees / charges to swallow up what equity you have. Are you able to make any repayments to the loan company ?

 

Hi 42man

 

The Default Notice I have just received, does not threaten repossession but alludes to seeking "judgement" against me.

 

I have read the Notice again, and it appears their strategy is to increase the amount owed by claiming the interest accrued on the original CO amount of five years ago to date!

 

This is what the Default Notice says:

 

_____________________________________________

 

4 : Further action: XXXX will:-

 

a) require immediate payment on the date shown of the outstanding balance under the Agreement less the rebate of interest charges to which you would be entitled, as set out below.

b) if the whole or any part of such sum ins not received, issue proceedings against you on or after the date shown for recovery of the outstanding balance (which may be reduced by any rebate to which you may be entitled as at the date of payment).

c) you should be aware that if we take you to court and get a judgement against you requiring you to pay us money you owe us under the agreement, you may have to pay us both the amount of the judgement and interest under the agreement on all of the sums owed by you at the sate of judgement until you have paid these off in full. This means that even if you pay off the whole amount of the judgement, you may still have a further sum to pay.

 

Termination of the Agreement will take effect on the date shown unless the total arrears are paid in full before that date.

 

____________________________________________

 

Is there anyway of stopping these scumbags pursuing this?

[unclebulgaria67]

Not possible.

 

I was thinking that the Mortgage company might not be happy having their asset sold, without their consent, as they are the first creditors.

[unclebulgaria67]

I am a bit confused here. If the loan company had a CO and there was no agreement to pay any sums in the meantime, how can they now just decide to go back to court again to see further judgement.

 

I think you need to revisit the paperwork that was supplied when the CO was agreed.

[MarathonPaul]

Uncle Bulgaria

 

Don't forget, there was no original judgement! They simply threatened me with bankruptcy, so I capitulated and agreed to have a legal charge registered on the property, this was five years ago.

 

I have opened up the legal charge (CH1) and it says:

 

_________________________________________________________

 

"To secure the sum of ***** including any further advances or charges therein such sums to be repaid by a schedule of repayments as may be agreed between the parties from time to time"

_________________________________________________________

 

If I don't agree to repay therefore, then surely they must wait for me to, one day, sell the property?

[unclebulgaria67]

Uncle Bulgaria

 

Don't forget, there was no original judgement!

_________________________________________________________

 

"To secure the sum of ***** including any further advances or charges therein such sums to be repaid by a schedule of repayments as may be agreed between the parties from time to time"

_________________________________________________________

 

If I don't agree to repay therefore, then surely they must wait for me to, one day, sell the property?

 

Ah I see. The key bit is " to be repaid by a schedule of repayments as may be agreed between the parties from time to time"

 

Well the time is 'now' and they want repayments agreed to or they will go to court to gain judgement, to put this on a proper footing. You will then be forced into repayments, based on what was affordable. I don't think they are suggesting forcing the sale of the house.

 

In this situation, I would think offering repayment at an amount you can afford, would be a smart move. Then if they did go to court, you have evidence of offering payment.

[MarathonPaul]

Ah I see. The key bit is " to be repaid by a schedule of repayments as may be agreed between the parties from time to time"

 

Well the time is 'now' and they want repayments agreed to or they will go to court to gain judgement, to put this on a proper footing. You will then be forced into repayments, based on what was affordable. I don't think they are suggesting forcing the sale of the house.

 

In this situation, I would think offering repayment at an amount you can afford, would be a smart move. Then if they did go to court, you have evidence of offering payment.

 

I agree with your view Uncle Bulgaria, is there any way out of this through some process or another?

[unclebulgaria67]

I agree with your view Uncle Bulgaria, is there any way out of this through some process or another?

 

Don't think so. Remember that any payments you make, will come off the CO total that was agreed previously. If you go to court now, they will add on interest at 8% per annum and that would be more expensive than making affordable repayments on an agreed basis. They may not accept the affordable repayments that you want to offer. But at least you would have offered and this may come in handy.