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Ash
Ash, Solicitor
Category: Law
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Experience:  Solicitor with 5+ years experience
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I am trying to get legal clarification regarding a business

Resolved Question:

I am trying to get legal clarification regarding a business loan secured against my property.
My business was dissolved 12 months ago, its assets and goodwill having been purchased by a third party. At the time of cessation, both a working capital overdraft, and business loan with Barclays were in place. At that time there were insufficient available funds to clear both the overdraft and loan. This was discussed with our then relationship manager who advised that we should clear the overdraft and simply keep paying the loan. This has subsequently been found to be bad advice, as when the company was struck off Barclays demanded their money back immediately and in full. They have acknowledged that I was given bad advice and have paid me £150 in compensation. They have refused to renegotiate the terms of the loan (the interest rate is very high for a secured loan) and transfer the debt to ourselves personally - even though they acknowledge we are personally liable. They are now seeking to repossess our house, which is currently up for sale. It has always been the intention to sell this property to clear the debt, so that is not the issue, it is the timeframe allowed and the accruing interest. Is there a legal mechanism which prevents them from levying interest exponentially until the property is sold. I referred the matter of the enforced property sale to the Financial Ombudsman and am waiting for their adjudication, but in the meantime interest is accruing.
Submitted: 2 years ago.
Category: Law
Expert:  Ash replied 2 years ago.
Alex Watts : Hello my name is ***** ***** I will help you with this.
Alex Watts : For now please let me know whether they have issued proceedings uet
Alex Watts : @ yet? @
Customer: No not yet. They have given us until 5th may to sell the property ourselves.
Alex Watts :

Do you know when you expect to hear from the Ombudsman?

Customer: They wrote to me mid January saying around 12 weeks.
Alex Watts :

The process is this. They have to seek an order for possession, you can defend this.

Alex Watts :

Even if you lose the possession hearing they have to apply for a warrant of eviction.

Alex Watts :

This further delays the process as you can apply for a stay in relation to that.

Alex Watts :

In reality if you have a complaint with the Ombudsman, even if they apply for possession you can ask the court to adjourn the possession pending outcome of that complaint.

Alex Watts :

The fact they have offered you compensation seems to be an admission of liability.

Alex Watts :

Therefore you should be ok defending any proceedings.

Alex Watts :

Can I clarify anything for you about this today please?

Customer: Thankyou. My equal concern is the accruing interest. They will not give
Customer: me access to the loan account as it was in the company name, and the
Alex Watts :

Yes indeed.

Customer: company no longer exists. They won't renegotiate the loan to us oersonally
Alex Watts :

Of course if they apply for possession you can raise that as a defence point.

Customer: and seem to be doing whatever they like, and one thing seems to contradict
Customer: the
Alex Watts :

Exactly. You just need to delay things so the Ombudsman can look at it

Alex Watts :

Does that help?

Customer: So basically you're not aware if any legal mechanism that can freeze interest charges ?
Alex Watts :

Sadly no - not without an order from the court.

Alex Watts :

It can be contested at Court and the Judge can intervene but you need to issue proceedings.

Alex Watts :

Or counter claim with your defence.

Alex Watts :

For the interest to be assessed

Alex Watts :

Does that clarify?

Customer: Yes it does. Thankyou.
Alex Watts :

Great. If I could ask you to rate my answer before you go today please, the button should be at the bottom of the screen

Alex Watts :

If you need more help please click reply

Ash and 2 other Law Specialists are ready to help you

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