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Buachaill, Barrister
Category: Law
Satisfied Customers: 10975
Experience:  Barrister 17 years experience
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A Receiver was appointed properties I own with one

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A Receiver was appointed for three properties I own with one lender Mortgage Express. The basis of the demand to repay the loans is under dispute at the Financial Ombudsman but is not the subject of this request for advice. For background information, I add that the ombudsman asked the lender to halt action pending the completion of their investigation but the lender refused as the Ombudsman does not have the authority to insist on that request.
The lender applied their consolidation rights on the redemption of the properties which means that if one property is to be redeemed all other properties will also be redeemed.
I redeemed one of the three properties by paying off the outstanding charge on it based on the redemption figure supplied by the lender. I then agreed sale of the redeemed property with a buyer with the permission of the Receiver and with their monitoring as they required to ensure that it is an arms-length sale. The Receivers liaised with the conveyancers and are satisfied that the sale is genuine and at arms-length.
My questions are:
(1) Having redeemed the charge on this property, does the lender have any legal hold on the property on any basis at all, even with their invoked consolidation rights?
(2) I then instructed the conveyancers with regards ***** ***** consolidation requirement, that upon completion of the sale, they apply the net proceeds from the sale of the property to the redemption of one of the other two properties and apply the balance towards capital repayment of the third property. I copied this instruction to the lender. If the lender has any legal hold on the redeemed property based on their invoked consolidation rights, how far does this disbursement instruction affect that hold?
1. The first thing you should be aware is that once you have redeemed the charge on the first property, the lender loses any hold over it. A lender can only apply a right of combination or a right of consolidation to any property over which there is money owed. So once you have redeemed the charge on it, the lender no longer has any hold over it, so it is now free from the clutches of the lender.
2. The second point is that if you sell this first property and apply the monies in discharge of the loan on the second property so it too is redeemed, then the lender loses any hold over it as the mortgage/charge on it is now redeemed. The lender can only apply his right of combination/consolidation over properties on which monies are owing. So again you take this second property out of the clutches of the lender.
3. When you had paid down the monies owing on the third property, you may very well find the lender quite willing to do business with you again as the loan to asset ratio will have fallen drastically, so the lender might once again be willing to advance money to you.
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Customer: replied 2 years ago.

Thank you very much MrCustomer/p>

I am very delighted that the law is on my side on this.

The occupants of this property will be evicted by the bailiff tomorrow 1 December 2015. Prior to the redemption of the mortgage the Receiver had made arrangements to receive the property from the bailiffs on the day.


- So I should attend the eviction and receive my property from the Bailiffs?

- If the Receiver or their agents turn up to receive the property, should I say to them they are at risk of unlawful trespass? Attempting to usurp my lawful property or actually do so? Should I call the police to at least bear witness? What do you advice?

5. So long as there is going to be no violence, i would advise you to attend the eviction. However, if there is going to be some "aggro" I would advise you not to attend as often aggression tends to be directed towards the landlord if there is a dispute involved. Instead, I would send along an agent who will receive the property from the bailiffs.
6. Get your agent to deal with the receivers. Essentially, the aim is to progress a sale. So your agent should engage with the receiver and point out that sale is intended and prepared and that this will go to reduce the overall indebtedness. Rather than being at odds with the Receiver, you and your agent should attempt to engage purposefully with the agent as the more money that comes in, the greater the remuneration for the receiver. If this is achieved with your help, then all the better for him. So your agent should seek to deal positively with the receiver if he shows up.
Buachaill and 2 other Law Specialists are ready to help you
Customer: replied 2 years ago.

Dear MrCustomer/p>

Further to my question from yesterday 30 November 2015, I would like to assert my ownership of the property I have redeemed the mortgage on. Is the following words suitable to write to the lender? Please strengthen it as necessary with legal words:

"As the mortgage charge has been redeemed Mortgage Express has no more legal hold on the property what so ever irrespective of your invoked consolidation rights.

Therefore I hereby assert my right as the owner of the property and request that Mortgage Express and their agents the Receivers and who so ever else forthwith cease to trespass my property or make any contact with my tenants or deal with any matters in court or elsewhere in relation to my property. I now take over all pending court matter with immediate effect..

(3) Your Receivers are hereby informed that it is not an excuse for trespass or interference in my property that Mortgage Express has not dis-instructed them from the property as they have now been informed that Mortgage Express has no more legal rights what so ever to that property and any interference with my property will be a serious deliberate breach of the law.

(4) Consequently, you had no right in law to abort the bailiff eviction today despite my repeated requests of you to proceed with it.

End of letter.

Is this what I should send to them in the first instance?

7. Dear chuba, the letter would go something like this:Dear SirsAs the mortgage and charge on the property at __ has now been redeemed, Mortgage Express no longer has any interest in this property.Accordingly, I ask that Mortgage Express and their agents, the Receivers cease and desist from entering upon or trespassing upon my property or otherwise interfering with my tenants. Any court action in relation to the tenants shall be adopted by me and I henceforth shall deal with this matter.Please ensure that your agents the Receivers are made aware of the position. Finally, the bailiff eviction today shall continue as intended and I shall deal with it.
Customer: replied 2 years ago.

Thank you very much Mr Bauchaill.

8. You are welcome.