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Category: Law
Satisfied Customers: 476
Experience:  Expert
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My wife and I borrowed £400k in 2004/5 from a business

Customer Question

My wife and I borrowed £400k in 2004/5 from a business associate to invest in property. We have paid to date £600k in interest and capital to date.We have agreed a full and final settlement of £250K by July 2021. Unfortunately we were unable to complete the property sale due to COVID restrictions. We have now agreed on an offer. Now the lender is threatening us with bankruptcy proceedings. What can we do to defend us against such proceedings?
Submitted: 14 days ago.
Category: Law
Expert:  JeremyT1020 replied 13 days ago.
Good afternoon and thank you for your question. I see that you specifically requested me to answer so I will give the question some thought and get back to you shortly. I'm currently at a family engagement for a few hours. If you did need an urgent response, I can always opt out and let another expert advise you. Kind regards, J
Customer: replied 13 days ago.
No. That’s fine. I will wait for you. Thanks
Expert:  JeremyT1020 replied 13 days ago.
Hello again and thank you for your patience. This may sound like a slightly daft response but have you actually written to or spoken to the lender about about your repayment to them and the reason for the delay? It seems incredibly unreasonable they're threatening to sue for bankruptcy when you're just about to sell.
Customer: replied 13 days ago.
Hi Jeremy, I have a representative who is dealing with the lender as we find difficult to deal with him. Even our rep who is a retired solicitor find him too demanding.We felt he is now slightly over the top even if you grant he has been patient with us over last 15 years or so. Perhaps with our difficulty in securing the highest offer and evicting the tenant we didn’t keep him updated but that is the commercial challenges of residential tenancy.We would like to have some savvy enough of modern residential tenancy laws to calm him as we feel ‘force majore” applies in our case. Perhaps he is applying some threats but we’d like to have someone to calm him for everyone’s sake. Thanks, Tim
Expert:  JeremyT1020 replied 11 days ago.
Hello again. My apologies for the delay in responding but I've been in my day job followed by teaching most of today. I'm grateful for your patience.Anyway, I think the lender is being incredibly unreasonable and I suspect he will fall flat on his face if he does try to issue bankruptcy proceedings irrespective of the force majeure argument.Your lender would have to demonstrate that they've tried certain legal processes to get you to pay your debt. He would have to serve you a statutory demand which is a legal notice about the money you owe him.If you don't pay or come to an arrangement to pay within 21 days, or get the statutory demand cancelled, he could ask the court to make a bankruptcy order. Realistically, it shouldn't go past this stage. You will have the money following the sale.If he was silly enough to apply to the court, you could make a counter-application to oppose the bankruptcy order. This is where you get the chance to confirm you've already made a reasonable offer of repayment, albeit following completion of the sale. You'd send a copy of this notice to him as well. I'd be backing this up with a letter from your conveyancer (maybe even a copy of the TR1 depending on what stage you'd reached).
Customer: replied 11 days ago.
Thanks Jeremy for giving a comprehensive reply. The issue is that we have just accepted an offer and it hasn’t progressed beyond the Estate Agent. We also have a task in getting one tenant out. We have asked a mediator to write to the lender explaining all the above without mentioning the force majeure in not so many words.The lender is a Chartered Accountant and he knows what the consequences are. He is unable to understand why we can’t sell quickly.Hope now he will calm down, but if it gets to a stage like statutory demands, can we approach you for further assistance?Once again thanks for your assistance.
Expert:  JeremyT1020 replied 10 days ago.
Hello again. I'd be delighted to help in the future. It might be the case that this question is closed to further posting but you would simply ask another question and reserve it to me. In the meantime, I hope you're able to get some joy and settle it. Kind regards, J
Customer: replied 10 days ago.
Thanks Jeremy. Much appreciated.