Repossession- Unregulated, Secured, Partnership/Ltd company. A Mess, help!

[cul8rm8e]

I really dont know where to start here but i will try and explain as best i can. The main reason for the post is to find out if the repossession is legal which is only the tip of the iceberg here.

 

A financial adviser is contacted to source funding for a small residential development. The adviser contacts a company who happen to be a broker. The broker sources funding from a lender and charges £1,000 app fee.

The application is made to LENDER which was successful, no issues. The name of the company at the top of the facility Letter is lets say "The Lender" There is no address or contact information of any kind within the contract other than the name of the company at the top.

 

As the contract was to release the funding in stages, the first stage was released and work carried out to complete all underbuilding work. Not further funding was released after this due to the lenders demands outwith the contract.

 

One thing led to another and the issue was unable to be resolved. The lender decided it was time to both serve a calling up notice and subsequently a court writ to repossess the partially developed land.

 

This is where things start to open up and i find out who is who

 

The issue is that the pursuer is a Limited Company, the same Limited company that the broker was a trading name of, effectively what this guy is saying is, the broker and "The Lender" were both trading names of the Limited Company- How was i to know that when the Financial Adviser requested £1,000 app fee payable to the lender and also there would be a £1,500 fee payable to the broker for sourcing the lender? Effectively it now looks like the Director of the limited company not only charged me to find the lender but HE was the Lender.

 

Now, to make things clear. The Limited company using the two so called trading names had a Consumer Credit License (Legal Formation: Body Corporate) (Nature of Business- Mortgage Broker) (Category-Credit Brokerage) this is very clear from OFT.

 

"The Lender" also had their own CCL as a separate entity,(Legal Formation: Partnership) (Nature of Business-Mortgages) (Category- Credit Brokerage and Consumer Credit) this is very clear from OFT.

 

"The Lender" from the mass of information i found out about them has been a Partnership company for many years but the Limited company who is pursuing the repossession has only been set up for over a year.

 

I am of the thinking that, as nothing mentioned in the contract about a trading name of the Limited Company (which would be a breach of the Companies Act) if it were the case. The limited company did not hold any CCL to be a lender. The Partnership was established at least 10 years prior to the Limited Company being set up, and most importantly, there will be litigation against the lender for breaching the contract it is simply a move to limit the liabilities to the Limited Company that seemingly does not much in the way of liquid funds.

 

Another slight twist is that, the broker and lender have no association whatsoever with the Limited company now they are now trading names of two other Limited companies this guy has set up and the CCL status of all companies is that they are Mortgage Broker NO MORE BEING A LENDER! Again, just to add a little spice. the three individuals who own the Partnership/Limited companies have between them Dissolved over 40 companies within the last 8 years or so.

 

Should it not be "The Lender" named within the contract pursuing repossession.

Should i be suing a company not named on the contract and also unauthorised to lend?

 

As i mentioned, this is the tip of the iceberg,

 

Thanks in advance

[silverfox1961]

Hi and welcome to CAG. Sorry you were missed.

 

I think this needs professional advice however, now that I have 'bumped' you our regulars may be able to assist.

[steampowered]

What happened with the loan? Presumably the borrower is in arrears? And the limited company is now seeking repossession whereas the original lender was the partnership?

[cul8rm8e]

Still onging but with a new twist.

 

When i mention he Lender i can now say that the lender was NOT the company named on the contract! The lender was the company who held the security over the property. (NO CCL to lend, although a CCL to be a Broker is in place. hmmmm

 

The new twist is that the Lender decided to execute rights within the contract produced by the other company whom i believed was the Lender initially, (Confused?) and create a Legal Assignment for the FULL AMOUNT OF LOAN he was to provide to an individual outside the UK even though he only provided 1/3 of what was in the contract by the company i thought was the lender.

 

Effectively 1/3 of the loan is provided and shortly after (and before the second stage funds were to be due and all without knowing about it) the lender sold/assigned by way of transfer of Standard Security for the full amount to the benefit of the the other 2/3 of the loan amount sitting nice and pretty in his bank account, again while refusing to honor the contract and provide the rest of the money.

 

The other thing about this is that The solicitor acting for the contract company/the lender facilitated the deal between the lender and the guy who was from outside the UK the standard security was then reassigned back to the lender weeks after the expiry date of the contract so that the lender could provide a Calling Up notice to repossess the land so he could get his initial 1/3 plus fees back, again, the same solicitor dealt with assigning it back to the lender. The borrower knew nothing about it and only found out after confirmation from the Land Registry.

 

The solicitor at the lenders end dealt with ALL transactions. They stipulate that the Limited company who hold security (the company who sold it and bought it back) and pursuing in court acted on the conditions of the contract provided by the other company but as yet they have not confirmed that the the company who provided the contract were a trading name of the limited company or a completely separate company. they will need to anser that question or it will be going to the proper regulators.

Edited June 23, 2014 by cul8rm8e

[steampowered]

Generally, lenders are permitted to assign their right to repayment and assign the benefit of the security to someone else without the consent of the borrower. That's not usually a problem. What they generally can't do is assign the obligation to permit drawdown of future advances. Generally you can assign rights but not obligations.

[cul8rm8e]

Yes but due to a breach of contract by the lender by not producing the other 2/3 of the loan under the contractual terms.

 

The reason as i understand is that the lender refused to release the second stage due to not being happy with information within a valuation report but, the first stage release was released on that very same report being satisfactory, if it wasnt then why did they release the first stage? that was also pointed out to them but it fell on deaf ears and then they provided another reason not to release but that is another story that will come out when needed.

Edited June 23, 2014 by cul8rm8e

[cul8rm8e]

Generally, lenders are permitted to assign their right to repayment and assign the benefit of the security to someone else without the consent of the borrower. That's not usually a problem. What they generally can't do is assign the obligation to permit drawdown of future advances. Generally you can assign rights but not obligations.

 

Can they assign the rights for the full loan amount knowing that they have obligations to provide further funds. My understanding is that they can assign to another lender but only for the outstanding due to them at that time. I know it was a Legal Assignment and from what i gather they are obliged to put this in writing to the borrower that they have assigned it, this is within the contractual terms i have shown below.

 

Not to mention that the lender, who is the pursuer did not hold a CCL as a lender, they did hold a CCL as a Mortgage Broker, the company who provided the contract did have a CCL for Consumer Credit but they are a Partnership company and as far as i am aware is a separate entity.

 

In my view, if the company who provided the contract which was signed by the borrower was a trading name of the limited company then why was it not made clear in the contract,(breach of companies act) no mention of being trading as anyone. Why would the pursuer be the limited company who did not hold a licence to lend clearly state that they are the lender. it has also been made clear that the contract company were the ones who were obligated to notify the borrower that an assignment had taken place but neither them or the limited company did, my understanding is that this is an obligation.

 

As for the assignment, it was made to an individual outside the UK. Within the contract it was to be a lender, as far as i know this was an individual who could be anyone, not a lender for sure.

 

 

We may, for reasons of business efficiency, decide to transfer your mortgage to another Lender. If we do so, the terms and conditions will remain unchanged, save only that you will be required to make payment to the new Lender and not to us. If we do this, we will notify you on completion.

[steampowered]

I see. Yes, your contract for future drawdowns that would generally be with the original lender.

 

The problem with commercial finance documents is that they tend to be drafted in a very pro-lender way. If you don't completely and perfectly satisfy all of the conditions precedent set out in the agreement, and make a drawdown request in the proper way, the bank has no obligation to lend. The conditions are often drafted in a way that confers a lot of discretion on the bank. This is one of the risks of borrowing to fund a real estate venture and is one of the reasons why so many highly leveraged real estate developers become insolvent.

 

I imagine there was a condition about a 'satisfactory' valuation report. Again this would give the bank a lot of discretion so difficult to challenge, but there is a possibility of legal argument about whether the bank used its discretion for a proper purpose, if it had already accepted the report as acceptable (though presumably you would expect a more advanced report at a more advanced stage of the report)?

[steampowered]

Can they assign the rights for the full loan amount knowing that they have obligations to provide further funds. My understanding is that they can assign to another lender but only for the outstanding due to them at that time. I know it was a Legal Assignment and from what i gather they are obliged to put this in writing to the borrower that they have assigned it, this is within the contractual terms i have shown below.

Yes, the right to receive repayment can generally be assigned to whoever. The only thing that changes in this scenario is which account you make repayments to. You could use any defences you had against the original lender against the assignee. The obligation to make any further advances would generally remain with the original lender.

 

Not to mention that the lender, who is the pursuer did not hold a CCL as a lender, they did hold a CCL as a Mortgage Broker, the company who provided the contract did have a CCL for Consumer Credit but they are a Partnership company and as far as i am aware is a separate entity.

I don't know enough about CCL licences to comment. It doesn't sound right you would need a consumer credit licence to lend to a commercial real estate development though?

 

In my view, if the company who provided the contract which was signed by the borrower was a trading name of the limited company then why was it not made clear in the contract,(breach of companies act) no mention of being trading as anyone. Why would the pursuer be the limited company who did not hold a licence to lend clearly state that they are the lender. it has also been made clear that the contract company were the ones who were obligated to notify the borrower that an assignment had taken place but neither them or the limited company did, my understanding is that this is an obligation.

Pursuer - are you in Scotland?

 

Yes, correct that an assignment must generally be notified to the borrower in order to be effective.

 

As for the assignment, it was made to an individual outside the UK. Within the contract it was to be a lender, as far as i know this was an individual who could be anyone, not a lender for sure.

Assignment outside the UK generally is not a problem.

[cul8rm8e]

Steampowered

 

The lending was to an individual not a company.

 

My understanding is also that if the borrower has not been notified then the assignment is not effective.

 

As it has been made very clear by the pursuers (pursuers companies solicitor) that the obligation to notify that there has been a legal assignment was that of the company who produced the contract then the producer of the contract should be the lender is that not correct.

 

To maybe help with understanding. It was to be the same person at their end dealing with everything. The Broker, the company who provided the contract and the limited company all belonged to at that time, three individuals who were either Partners in a Partnership company and Directors of the Limited company.

 

As far as i am aware, the relatioship between all off these companies will be made clear very shortly but either way none of this adds up

 

As for the assignment to someone outside the UK. this was made to an individual, not to a lender whom i expected would be a company authorised to lend and at no time has it been advised that any repayment should be made to this new lender for the obvious reason that the borrower had no idea that any sort of assignment had taken place. I know for a fact that there was not Notification as a SAR was sent to all companies and no document was provided to show that any kind of notification was sent to the borrower so thats not something they can expect the borrower or a court to swallow, they had two opportunities to notify.

[cul8rm8e]

I have received an email from a solicitor stating that their client is accusing me of many things which i have not done. What would be the most appropriate way to deal with this?

 

My initial thought is to take legal advice as i believe it is very serious accusations.

 

Copy of email below.

 

 

Dear Mr xxx,

xxxxx xxxxxxxxx

 

I refer to the above named.

 

 

 

I act on behalf of Mr xxxxxxxxx. My client has advised me that you have contacted him by email and contacted his office by telephone on a number of occasions over the past few months. The tone of your emails and phonecalls has been threatening and our client regards your conduct as harassment. In addition, I am advised that you have given my client’s details to numerous pay day lenders and fraudulently used his personal details to sign him up for pay day lending facilities.

 

 

 

You must cease and desist said harassment and criminal conduct immediately. My client has kept a record of all communications by you and engineered by you and intends to report all matters to the Police.

 

 

 

Yours sincerely

[renegadeimp]

Solicitors will send any letter they are paid to produce.

 

If you challenge them theyll say they were acting upon their clients instruction in good faith.

 

Can you give us details of events leading up to this letter.

[cul8rm8e]

Lets just say he is a Broker/Lender and someone who has been involved with multiple companies over a short number of years, nearly all of which has been dissolved and new ones started up with very similar names. lets also say that he doesnt like the fact that he has been advised (very politely) that he is providing false information online in many places regarding his own status and i have helped him out to realise the information his clients are seeing about him is wrong. I trust the help i am giving him has really ****** him off as his online presence is now that of a wanna-be high flyer and not as he would like it to look like, a successful businessman.

 

I have to say that all the information i have provided to him, which he felt the need to change, is in the public interest, effectively he has his own PA looking after his own interest with regards to the way in which he can and cant portray himself within his online presence. I am not even charging him for it

[steampowered]

If the accusations are not true the appropripate response is a short, polite response to the solicitor correcting any factual inaccuracies in the letter. You don't need to say more than that.

 

If you have been signing him up to payday lenders that is of course fraudulent and is a criminal offence.

[Ganymede]

Lets just say he is a Broker/Lender and someone who has been involved with multiple companies over a short number of years, nearly all of which has been dissolved and new ones started up with very similar names. lets also say that he doesnt like the fact that he has been advised (very politely) that he is providing false information online in many places regarding his own status and i have helped him out to realise the information his clients are seeing about him is wrong. I trust the help i am giving him has really ****** him off as his online presence is now that of a wanna-be high flyer and not as he would like it to look like, a successful businessman.

 

I have to say that all the information i have provided to him, which he felt the need to change, is in the public interest, effectively he has his own PA looking after his own interest with regards to the way in which he can and cant portray himself within his online presence. I am not even charging him for it

 

 

 

So is it true or not?

 

You seem to be admitting to sending him numerous emails and to taking great pleasure from it. Maybe you should just stop it?

 

What about the payday loans?

[cul8rm8e]

I understand that it is possible to make a complaint to a solicitor who was not acting for you and was wonder what to do if this solicitor does not provide the information requested.

 

To cut a long story short, the solicitor was acting for a lender who provided a personal secured loan to a an individual.

 

There are a number of companies involved. i.e broker, company who produced the contract and the Limited company who took the security. All companies are run by three individuals and it was to be the same individual who dealt with the borrower all the way through the process, this individual was a Partner and Director in all companies at the time.

 

All done properly through solicitors at both ends

 

To explain it all.

 

A produced a contract for the borrower which was signed. (no mention of being part of another company, "trading as") (dealt with Mr X as a Partner in the company)

B produced documents to assign security that was taken, (dealt with Mr X as a Director in that company)

B produced first stage part of the funding under the loan which was to be provided in two stages.

B (without the knowledge of the borrower) after providing the first stage funds Mr X Director & mr Y Director) legally assigned the security to C (an individual ) for the full contract amount provided by A

B refuses to release second stage funds under contract provided by A

 

 

Contract between A & Borrower expires

C still holds security at expiry date of contract.

 

Weeks later

 

B buys back standard security from C (individual) for exact same amount

B proceeds to start court proceedings to recover first stage release of funds plus interest/fees to borrower.

 

 

Borrower makes a complaint to A & B & C solictor as they facilitated ALL transactions between all involved at that end.

 

A Partnership company held a consumer licence (Consumer Credit)

B Limited company held licence as a Mortgage Broker.

C have no idea who he was as he lived outside the UK

 

 

Within contract between A & borrower was a condition

 

 

We may, for reasons of business efficiency, decide to transfer your mortgage to another Lender. If we do so, the terms and conditions will remain unchanged, save only that you will be required to make payment to the new Lender and not to us. If we do this, we will notify you on completion.

Borrower only found out about the assignment from B to C six months after expiry date of contract between A & Borrower so never knew at the time what went on.

 

 

A,B & C solicitors when asked about the assignment said: The obligation to notify the borrower that an assignment had taken place was that of A (to me indicates that A was the Lender as always thought)

They also said that B provided the funds (indicating that they are the lender as per the pursuer within the court documents) but, no licence to be a lender but only to be a broker(Confirmed on OFT site and in writing by the FCA)

 

Subject access requests made by borrower to A & C:

A produced NOTHING and B produced what was received (No coy of notification of assignment from them to C (Why? if they are the lender )

 

borrower submits complaint to A,B & c solitors requesting information.

Is A (a partnership company)a trading name of B (a Limited company)

also

Is A & b completely separate companies (as per the OFT licences)

 

the solicitors are continually avoiding the question and wil not provide the information as to the relationship of A&B even though they dealt with the contract produced by A and the security taken by B and the further assignments from B to C and back from C to B so that B can start court proceedings to recover the first stage funds that they say B provided.

 

The question is: What can i do to get this information?

 

 

PS I know there is documentation to prove that A & B are separate companies. i cant mention what i have but its very clear

 

A (Partnership) has been going for over 20 years and B (Limited Company) was established for less than 2 years.

 

The broker company is also owned by Mr X which was at the time was a trading name of B

 

I hope this is understandable.

 

Any help would be much appreciated.

 

thanks

 

 

 

 

 

[cul8rm8e]

A more simple question.

 

How do i get the lenders solicitor to divulge the information about their clients as to the relationship between the company that provided the contract and the other company who took the security and sold it on to someone outside the UK

[Ganymede]

A more simple question.

 

How do i get the lenders solicitor to divulge the information about their clients as to the relationship between the company that provided the contract and the other company who took the security and sold it on to someone outside the UK

 

 

You can't. It's called legal privilege.

[cul8rm8e]

All cleared up now

[Ganymede]

All cleared up now

 

Good. How?

[cul8rm8e]

Good. How?

 

Solicitors came good. :)

 

I now wonder what the outcome of a SAR would be!

 

I will update in due course

[cul8rm8e]

just thinking that now its established.

 

The broker requested an application fee to be paid £1000 it was requested (in writing) of the borrower to telephone the broker and pay this fee or pay it into the account of the contract company which details were provided (lender?) A telephone call was made to the broker and they took payment by card, BUT, on borrower checking bank account the payment went straight to the contract company (Lender?)

 

Financial Adviser - the mate of the owner of the Broker, The contract company (lender?) and the limited company (Lender?) charged £1000 for finding the Broker, his mate. (maybe i shouldnt use mate, the FA was actually an ex employee) hmmmm

Now the contract company charged £1500 for Arrangement Fee. (Arranging what? the loan as a lender or just the loan as the company who produced a contract?)

A further £1500 was charged as a Broker Fee to the Broker to allow Mr X to contact himself and ask about a loan, and also to contact himself to ask if he could provide himself with a written contract for the borrower.

 

In my book that is £5k for the FA to ask his mate to ask himself to write a contract to ask himself to lend money to tell himself yes and tell himself yes and tell his mate to tell the borrower yes. YES?

 

I am sure that the initial fees provided by Mr X who provided them to the FA who then passed onto the borrower were less than half what was in the contract when it arrived.

 

Something tells me Mr x seems to get paid every time he asks himself a question and realises if his own answer is yes then he gets paid more.

 

Not to worry, when the time comes and Mr X explains everything to someone who deals with these complicated matters every day then maybe i can listen in and come back here and explain my confusing story.

 

 

Maybe its me, Maybe i`m Mr X :lol:

Edited June 27, 2014 by cul8rm8e

[AndyOrch]

Or better still don't get involved with unscrupulous lenders ?

[cul8rm8e]

Yes your right but.

 

When theres no way of knowing that the reason your FA is making things out to be all in order so that he can go back to work for his mate (the lender) what can you do. Yes, when the stuff hit the fan and you contact your FA to get advice to sort out a mess and you find out he has left his company and away working with the lender (His Mate) its hard to take. He is another one who will have to explain his actions also in due course.

[cul8rm8e]

THE LENDER COMPANY UK

 

 

FACILITY LETTER

 

 

 

Date: …. Month 2013, ….

To : Borrower

 

Dear Borrower

 

Re : Secured Property Address

 

Having considered your application for a loan, we confirm that we are prepared to lend you, subject to satisfactory searches and enquiries, the sum of £xx.xxx, on the following terms and conditions :-

 

1. The loan will be secured by way of a First Charge on the property being Secured Property Address (“the Property”). This security together with any other security to be held by us, will secure all monies and liabilities from time to time due, whether actual or contingent.

 

2. The loan will be repayable at the expiry of x months from the date of completion of the loan (the “Loan Repayment Date”), or earlier on demand where there has been a failure to make a payment as and when it falls due, or there has been a breach of a term or condition of the loan. For the avoidance of doubt interest is payable for the x month period, regardless of whether the loan redeems within this period and on redemption in full the sum of £xxxx is payable (representing x months interest at the rate of x %pcm).

 

3. The loan will be utilized by you for the following purpose :-

 

Business purposes for the development of x dwellings for onward sale or letting and not for occupation by you or your immediate family

 

In the event following completion that we become aware that the loan has been used otherwise than for the purpose stated above, an act of default will be deemed to have arisen and we reserve the right to demand the immediate repayment of the loan together with interest, costs and disbursements then accruing.

The initial loan payment to be made to you will be the net sum of £xx,xxx (after deduction of interest per clause 4 (e) and all fees as per clause (5) and the balance shall be retained. The balance of the loan funds shall be paid in further instalments upon a satisfactory report from our surveyor and site visit by our representative and £xxx shall be payable by you at each stage release, together with the costs of updating the searches by our solicitors.

 

 

 

Signed …………………………. Date …………………...

 

 

 

 

 

 

4. a) The Standard Flat Rate of interest shall be x.x % per month until full repayment of the Loan is made. Interest will be charged at this rate on the principal sum, for the first calendar month, then at the same rate on the balance outstanding calculated and paid in advance at calendar monthly intervals.

 

b) Where, after the Loan Repayment Day has passed and you fail to discharge the balance due to us, then we will charge interest at the Standard Flat Rate of Interest until redemption.

 

c) At your request, a sum equal to x months’ interest at the Standard Flat Rate of Interest shall be deducted from the loan and thus no monthly payments will be required during the Loan term.

 

d) The interest rate is fixed for the term.

 

e) Unless interest has been retained by us at your request, the first payment is to be made one month after the date of completion of the loan and subsequent payments are to be made on the corresponding day each month. Where the month has no corresponding day, the payment is to be made on the last day of that month.

 

Interest shall be charged on the full amount of the Loan referred to above, and such interest shall accrue on the amount in question on a monthly basis (as well after as before any judgment) from the date or last date for payment thereof to the date of actual payment, and such interest shall be compounded with monthly rests and shall be payable monthly in advance by the Borrower.

 

5. Fees:

The following charges will apply to this facility and will be deducted from the loan on completion. These are your responsibility, and are non-refundable:

· Legal Fees – £xxx plus VAT and outlays.

· Arrangement Fee - If the loan completes you will be liable for an arrangement fee of £xxxx.

· Broker Fee - £xxxx payable to ……………

· Financial Adviser fee - £xxx

· Exit fee (payable upon redemption) - £xxxx

 

 

 

 

Signed……………………………………… Date………………………….

 

 

 

 

 

 

 

 

6. Legal Fees, Charges and Disbursements:

 

These are your responsibility. Our solicitors ………………………………… will ………………………………………. They cannot act for you and will not offer you any advice in respect of this facility. The legal fees as specified in Clause 5 hereof shall be due and payable in full, whether or not the loan proceeds, and shall be paid within 14 days of demand. If the loan proceeds to completion, these will be deducted from the gross loan at completion.

 

Once completed, you will be responsible for all fees, charges and disbursements which we may incur in protecting the security or enforcing the security or Legal Charge and in its discharge. These will be added to the loan, and interest charged at the monthly rate and calculated daily will be applied.

 

7. Insurance:

 

It is a condition of the loan that the property must be kept insured at all times during the term of the loan to its reinstatement value against damage by fire and other perils, including malicious damage and other perils specified by us. If the property is not insured, or the level of insurance is insufficient, we can arrange suitable cover at your request. You will be responsible for the cost. We will ask you to authorise deduction of the premium from the mortgage proceeds.

 

8. Default:

 

Default will occur if :-

 

a) You fail to pay any amount (including interest) expressed to be payable by you pursuant to the terms of this Facility Letter or the Legal Charge secured by it at the time and otherwise in the manner specified in this Facility Letter.

b) You for any reason fail duly and promptly to observe and perform any obligation or undertaking expressed to be binding or undertaken by you pursuant to the terms of this Facility Letter or the Legal Charge secured by it.

c) Any representation or warranty given or made by you in relation to this Facility Letter or the Legal Charge secured by it proves to be incorrect, inaccurate, incomplete or misleading in any material respects.

d) A bankruptcy petition is presented against you, and/or in the case of a company, a Receiver is appointed or resolution for the winding up of the company is passed.

 

 

 

Signed …………………………. Date …………………...

 

 

 

 

 

e) You commence a meeting of creditors or propose making any arrangement of compensation or any assignment to the benefit of creditors.

f) You transfer, dispose of or threaten to transfer, dispose or otherwise deal with the security without our consent.

g) Where in the case of the facility being secured by second charge you fail to make payments or default under the terms of the First mortgage

 

In the event of default, where the default is capable of remedy, but not remedied within 14 days after the date of a written Notice from us or our Solicitors, or in the case of an act of default under Clause 8 © immediately, we may by return give notice to you to terminate our obligations hereunder and declare the loan to be due and payable, either immediately or upon demand and thereafter initiate court proceedings to enforce the Legal Charge.

 

9. Special Conditions:

 

a) Our solicitors must be satisfied in all respects as to the marketability of title to the security after having due regard to title documentation and all relevant searches.

b) We will require a professional valuation of the security, addressed to us, in a form acceptable to us. We may require additional specialist reports if recommended. –

c) We may from time, following drawdown wish to revalue the security. Should we do so, you must facilitate such valuation. The costs of any such valuation will be added to your account and interest charged thereon at the contractual rate. Where building/conversion works are to be carried out to the property, these are to be carried out to a proper standard by properly qualified contractors and all works are to be carried out in accordance with the planning permissions and consents. Thereafter you will maintain the property to a reasonable standard of repair. The costs of any such valuation will be added to your account and interest charged thereon at the contractual rate

d) That you have, or will contemporaneously with the mortgage advance, acquire good and marketable title to the security to the satisfaction of our solicitors

 

10. Assignment:

 

We may, for reasons of business efficiency, decide to transfer your mortgage to another Lender. If we do so, the terms and conditions will remain unchanged, save only that you will be required to make payment to the new Lender and not to us. If we do this, we will notify you on completion.

 

 

 

Signed …………………………. Date …………………...

 

 

 

 

 

11. Tenancies:

 

You may not create new tenancies, or renew existing tenancies without our previous written consent during the loan.

 

If the property is tenanted, and you do not tell us, or misrepresent the nature of the tenancy, this will amount to an event of default.

 

12. Renewal of Facility:

 

Should the advance not be completed upon 14 days of acceptance of this letter then the facility shall lapse. It may be renewed at our discretion, and we may require a further facility fee.

 

13. Jurisdiction:

 

This Facility Letter and any Security secured by it is deemed to have been made in Scotland and its constitution, validity and performance shall be governed in all respects by Scots Law.

 

Each clause and each subclause of this Facility Letter and any Security secured by it shall be separate, distinct and severable from each other clause or subclause.

 

Where any agreement, Undertaking or commitment is made on the part of 2 or more persons then the same shall be deemed to be given to such person jointly and severally.

 

14. Settlement:

 

Settlement must take place upon expiry of term or by redemption howsoever arising. You will be required to repay all monies outstanding together with the following: -

 

1) Legal costs of discharge of each security £xxx

 

 

All payments must be made in Sterling and via our solicitors, SOLICITORS DETAILS of their bank details will be given on request.

 

All settlements must be made in the sum dated without set-off or counterclaim and free from and clear of any deduction.

 

 

 

Signed …………………………. Date …………………...

 

 

 

 

15. What Happens Next:

 

If after reading this letter you wish to proceed

 

1) You should take independent legal advice

2) Upon our receipt of the above we will instruct our Solicitor to enter into correspondence and deal with your solicitors in respect of documentation and their requirements

 

 

By signing this agreement you request and authorise us :-

 

(i) If the Security is not to be a first mortgage, to pay any prior mortgage arrears;

(ii) If the property to be mortgaged is leasehold, to pay any rent, service charge or other

sums owed by the borrower which, if not paid, may result in the borrowers losing

the property. These payments will be made by the lender on the Borrower’s behalf

by taking adding them to the Loan Facility.

 

 

By signing the Facility Letter you declare and warrant that:

 

a) You have read and understood the terms and conditions of this Facility Letter and you acknowledge that you have been recommended by us to take independent (and, where there is more than one person borrowing, separate) legal or other appropriate professional advice on their contents, on the contents of any other documents that we require you to sign and in respect of the loan generally; and

 

b) You will be able to afford to repay the Loan as and when you are required to do so and the monthly instalments as and when they fall due.

 

c) You acknowledge that we have relied upon the declarations and warranties made by you in arriving at our decision to lend to you the sum stated above.

 

d) We reserve the right to alter the terms hereof or to withdraw this Facility at any time without assigning a reason. In the event of this Facility being withdrawn under this, or any preceding clause, we shall in no way be liable for any liabilities incurred by you.

 

e) The Standard security to be granted will be in standard Scottish format

 

 

 

 

 

 

Signed …………………………. Date …………………...

 

 

 

 

 

 

Declaration for exemption relating to business (Sections 16B and 189(1) and (2) Consumer Credit Act 1974)

 

I am entering this agreement wholly or predominantly for the purposes of a business carried on by me or intended to be carried by me. I understand that I will not have the benefit of the protection and remedies that would be available to me under the Consumer Credit Act 1974 if this agreement were a regulated agreement under that Act. You declare that you will not reside in the property at any time during the currency of the loan.

 

I understand that this declaration does not affect the powers of the court to make an order under section 140B of the Consumer Credit Act 1974 in relation to a credit agreement where it determines that the relationship between the creditor and the debtor is unfair to the debtor.

 

I am aware that, if I am in any doubt as to the consequences of the agreement not being regulated by the Consumer Credit act 1974 I should seek independent legal advice.

 

I/we hereby accept the above offer of advance, the terms of which I/we fully understand and accept. I/we understand that any other parties concerned in this transaction are not acting as your agents and are not authorized to vary the terms of this offer in any way. I/we confirm receipt of a copy of this letter, which I have retained.

 

Please indicate your acceptance of the foregoing by signing and returning the attached copy of this letter.

 

ONLY SIGN THIS FACILITY LETTER IF YOU WISH TO BE BOUND BY ITS TERMS.

 

YOUR HOME IS AT RISK IF YOU FAIL TO KEEP UP REPAYMENTS ON A LOAN OR MORTGAGE SECURED UPON IT.

 

Should the facility not be accepted within 14 days, it shall lapse without prior recourse to you.

 

 

Signed …………………………………… Date…………………….

 

Signed…………………………………… Date………………………………

 

Edited June 27, 2014 by cul8rm8e