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Stuart J
Stuart J, Solicitor
Category: Law
Satisfied Customers: 24582
Experience:  Senior Partner at Berkson Wallace
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I have an issue about a secured debt, I am in london, I have

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I have an issue about a secured debt
JA: Where are you? It matters because laws vary by location.
Customer: I am in london
JA: What steps have you taken so far?
Customer: I have offered the bank a security for a properties that has a shortfall, but they now want 3 houses as security
JA: Is there anything else the Lawyer should know before I connect you? Rest assured that they'll be able to help you.
Customer: I am not in arrears of anything, all my payment for this property are up to date and I am even making overpayments. The property was taken by the council as a CPO. The Bank has not agreed to anything but offer another security and they have taken me to court, adding huge legal fees. I am just trying to settle but they have now chnaged their original request of 1 property to 3 property as security, even though my proposed property has enough equity to satisfy their loan
Customer: replied 6 days ago.
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Customer: replied 6 days ago.
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Hello. Thank you for the question. It is my pleasure to assist your with this today.

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Can you give me all the background to this matter in order for me to advise correctly - thanks

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Customer: replied 6 days ago.
please give me a few minutes
Customer: replied 6 days ago.
I have a property that has been taken by the council as a CPO in July of 2020.The CPO created a shortfall of £37000. I have offered the bank to pay the shortfall in instalments, and started to making overpayments of £150 a month from October 2020. Before the CPO I also asked if they would allow me to sell the property at auction in the open market before the CPO and the ban refused to so unless another property was offered as collateral.
All my mortgage payments are up to date. The bank has refused my proposal to pay in installements even though the full balance would have been paid within the life of the mortgage. I specified this in multiple email and also started taking action on my proposal, even if fully agreed by the bank.
The bank has continuously threatened litigation, saying that nothing would be acceptable apart from a voluntary charge against another property, and explained that if I did not agree voluntarily they would take me to court to get it.
In July 2021 despite my continuous payments of £150/mo extra and my regular mortgage payments the bank called the loan and requested an immediate payment of £59000.
After that they issued a Money claim for £59,000. I have defended the claim to avoid the judgement and then asked to settle at the next stage.
I have now offered the bank to have 1 property as a security, and even though there more 100k in equity and their loan is only 63,000 (with new legal costs..) they are now asking for 3 houses as securityI would like to know if the bank has the right to refuse my offer of the 1 property I am proposing. Their loan is about £63000 and the equity in the property should be over £120,000. Also my previous property that was taken by CPO should provide compensation of £20,000. On what basis could they refuse my security, since they asked for just 1 property before taking me to court.Also if they don’t agree and we end up in a trial is there a limit to the legal costs they can claim? They have submitted a total budget of £20,000. Could this £20,000 turn into £30,000 or £40,000 and they can get away with that?Finally is there a reason why their lawsuit could be considered unjustified, since I was completely up to date with my payments and I was already making overpayments that could be considered a reasonable proposal.
Customer: replied 6 days ago.
hello, I don't know if I am allowed to ask another question. If I offer the bank 1 security as they previously asked and they refuse saying they want 3 houses, is there a way for me to inform the court of what is happening to avoid the trial? for example some kind of motion to dismiss the case since the request of the claimant has been offered even though the claimant is refusing to accept it?
Customer: replied 6 days ago.
you are wellcome to answer this question by chat

I don’t know why you are hung up on providing security for 3 properties as opposed to 1 property because of you are going to pay the loans, it makes no difference.

If you don’t pay the loans, they would go to court, get a judgement and then apply for the charging order against the property is anyway.

On the other hand: If it is a condition of the loan you are obliged to provide security then you are offering that security provided it is sufficient and if it proceeds to court, you can make that point to the judge and asked the court to disallow all the legal costs on the basis that the legal costs have been incurred totally unnecessary.

If they had a charge against the property which was compulsorily purchased, the sale of that property should have paid off their charge so I don’t know why that didn’t happen.

Customer: replied 5 days ago.
Thank you for your answer. The property that was acquired by the cuncil as a CPO was in negative equity, and the council offered only 20,000 to buy it. The mortgage outstanding was 57,000.That is why a bit shortfall has been generated and the bank is very aggressive in their dealings. Anyway thank you for all your answers.
Customer: replied 5 days ago.
The concern over offering 3 propertties as a security is that if I needed to sell or rfinance one of the 3 properties and this bank had a charge on it, they could request that their loan be repaid before I see any of my equity. This means I would need to take a cahs loss of over £50,000 at the moment of the sale or remortgage.

It’s interesting, the bank had security over property that was worth nothing, and in negative equity, and now they are griping that they have lost the security which was worthless.

Your comments about having to refinance the properties is noted although it might be worthwhile looking at that to refinance to get away from this bank you are clearly not as wholesome as they could be.