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Max Lowry
Max Lowry, Advocate
Category: Law
Satisfied Customers: 1457
Experience:  LLB, 10 years post qualification experience
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I need legal advise with a large debt I am a professional

Customer Question

I need legal advise with a large debt
I am a professional surgeon. A Consultant and while I was undergoing my training I went into a partnership which ended in a bitter dispute. At The end I am left with nothing and owing the bank my share of the business loan. The bank has charge over my house.
PLEASE HELP. The bank issued legal proceedings and the next step is to enforce the action that was granted to them by court.
Can they take or force me to sell my house? I co own my house with my wife.
Not much equity there.
Would they accept a repayment amount on a monthly basis?
Submitted: 3 years ago.
Category: Law
Expert:  Max Lowry replied 3 years ago.

Max Lowry :

Hi, welcome to Just Answer. I will help you with your question.

Max Lowry :

If they have a Court order to sell the house, then yes, they can do this. However, the only point in doing this is to obtain the equity that belongs to you. If 50:50 with your wife, then only your share of the equity can be sought.

Customer:

what does that mean?

Customer:

can they force a sale of the property

Customer:

What measures can I do to stop them from forcing sale of our house? could my wife object as this will destabilise our home and two young daughters?

Max Lowry :

Yes, they can force the sale.

Max Lowry :

If you can get your wife to buy your equity - then they wouldn't bother forcing the sale.

Customer:

Does that mean I transfer the house in my wife's name

Max Lowry :

No.

Max Lowry :

Well, actually, you could do that if the lender consented to you doing it, but whilst you have a mortgage with little equity you might find that unlikely.

Customer:

if she buys my 50% I can sell my bit but all her savings would not amount to 20% of the total debt

Max Lowry :

But, more realistically, she could offer the bank the same money they would get by selling the house. Then, there is no reason to sell it.

Max Lowry :

The amount of the total debt is irrelevant. This is about stopping the house being sold, and if there is no equity in it, or she offers the value of that equity to the bank, then the Court is not going to allow it to be sold as there is no financial benefit to that happening.

Customer:

do you mean our mortgage provider?

Max Lowry :

If it's the mortgage provider that issued proceedings, then yes.

Customer:

if she offers the bank the same money and she does not have it. would they accept a repayment on a monthly basis as if it is part of a mortgage

Max Lowry :

Thats up to them - but they wouldn't have to, as if they sold the house, they'd get it (almost) immediately.

Customer:

no the mortgage providers are good with us. the business loan which is with a different bank is the one in question

Max Lowry :

Okay - same principles apply with the bank as the lender.

Customer:

so what is your advise

Customer:

i owe them 206,000 on a business loan

Max Lowry :

Well, they're secured, which means you'd have to try and do a deal with them and show them there is no equity in the home.

Max Lowry :

Bankruptcy / IVAs etc will not make a difference as they're secured.

Max Lowry :

They want the equity - believing it'll pay off the debt. Maybe it wont? If not, then you need to show them that. Take away the point of doing any of this.

Max Lowry :

If it will, then you just need to reach a negotiated deal with them.

Customer:

OK so if I draft a letter to say the house is worth £xxx and the equity is less than the amount owed. I can offer a lump sum of our savings that is £25,000 and I can get a guarantor - my parents - to pay £1000 per month do you think in Law terms is something that could be accepted?

Customer:

Couls I ask them to consider taking off the interest which works to be £43 per day

Max Lowry :

This is something that could be accepted by them, yes. There is no legal reason they couldn't do this. Also, it might be attractive to them, as if you dont have the money otherwise, they're not going to see it in reality, and the offer of others paying, might make them take it.

Max Lowry :

And yes, to be honest, when you get to the stage of not being able to pay, you often find the first thing they'll do is abate the interest in any negotiated settlement.

Customer:

The point of offering 25,000 is a huge sum for us and looks small as a just over 10% of the total debt

Customer:

the banks solicitors are insolvency practitioners and are really rough or a polite word tough to talk to

Max Lowry :

Can you avoid bankruptcy?

Customer:

what is your advise? should I get a lawyer to represent me and negotiate on my behalf?

Max Lowry :

It is worth at least either getting a solicitor to negotiate for you, who will be familiar with what you can "get away with" or at least a debt advisor at the CAB.

Customer:

yes I would have to avoid bankruptcy at all cost

Max Lowry :

Okay - then a negotiated settlement really if your way forward.

Max Lowry :

is ,,, sorry.

Customer:

excuse my ignorance what is CAB

Max Lowry :

Oh sorry, the CAB is the Citizens Advice Bureau. It's an amazingly good service, and they see people will all sorts of debt issues all the time. And, it's free to use, which you might think it means it's not as good as peraps using a solicitor, but to be honest, it often can be.

Customer:

I am a surgeon who has an excellent future ahead of me and recently appointed a consultant and I know I could pay that debt

Customer:

would they offer me advise if I am working

Max Lowry :

To be fair, if they can see the prospect of you being able to pay it within a reasonable time, the last thing I expect they'd want to do it look at selling the house and making you bankrupt etc as they they get very limited amounts back.

Max Lowry :

And yes, they offer everybody advice - they don't seek to means test you or anything, it's always totally free.

Max Lowry :

It's a fab service. Honestly, and you've nothing to lose by speaking to them first, ad seeing a solicitor afterwards if you wish to.

Customer:

excellent

Customer:

I have

Max Lowry :

Let me know how you get on with the CAB if you use it - I'd be interested to hear your feedback.

Customer:

sorry

Customer:

I have to call them in the morning

Customer:

will do . is there a central number for CAB ? or is it something I can Google

Max Lowry :

Okay - well I hope it all goes well for you, I'm sure it'll work out right in the end. Bankruptcy isn't often favouredb y creditors where you have the means to pay the debt but over a longer time.

Max Lowry :

You need to find your local branch - so google :)

Customer:

great

Customer:

you have been excellent in your responses

Max Lowry :

Thank you. I do hope you manage to sort this quickly, an painlessly, and I think you'll be surprised that you can do a deal and one that works for you - just make sure you stick to any deal that you do!

Customer:

By the way How detailed should I give them about my financial situation. For example do I go and get my home valued

Max Lowry :

Give the CAB/Solciitor everything they need to know. A valuation would be useful, but not necessarily essential at the moment.

Customer:

bank statements etc

Max Lowry :

Not necessarily statements, if you know roughly what is in them. They need a general overall picture, the minutiae of the transactions isn't needed at this stage.

Customer:

My wife has other savings but this is HER money and I do not want to ask her - My parents are happy to support me and have paid and spoilt me while studying at Medical School. So If I go to my parents would they ask whats in my wife's account which she has put my name on also. But it is her money

Max Lowry :

They would ask what's in joint accounts I expect, yes.

Max Lowry :

But, you just need to make it clear you both regard it as her money. And that you agreed that at the outset presumably.

Max Lowry :

With joint accounts, there might be an issue as to whose money it really is. But this just is something you have to convince them is her money.

Customer:

Sure

Max Lowry :

I hope this answers your question. If you need further information, just let me know. Please do remember to rate my answer as highly as you can.

Customer:

of course

Customer:

thanks v much excellent service

Max Lowry :

Maybe let us know how it goes tomorrow. And thank you too! Good luck.

Customer:

Cheers

Max Lowry :

Goodnight.

Customer:

Good night

Max Lowry, Advocate
Category: Law
Satisfied Customers: 1457
Experience: LLB, 10 years post qualification experience
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