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  • FIRST POST
    • Diddidi
    • By Diddidi 5th Oct 17, 8:14 AM
    • 28Posts
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    Diddidi
    Old mortgage shortfall debt - can anyone advise?
    • #1
    • 5th Oct 17, 8:14 AM
    Old mortgage shortfall debt - can anyone advise? 5th Oct 17 at 8:14 AM
    My husband had his property repossessed about 20 years ago - at that time the mortgage was about £50K and the property sold for £25K. However, the building society at that time estimated the amount owed at £75K. This was thrown out by the court as being too high and a more reasonable figure of about £26K was agreed. My husband started paying an amount each month towards the shortfall on behalf of him and his ex-wife.

    Roll on 20 years and we get a letter out of the blue from solicitors on behalf of their client (no longer the original building society but new bank owners) requesting payment of the £75K. Letters went backwards and forwards and we took free legal advice as well, which wasn't a great deal of help as no one seemed to have dealt with anything like this before. The result of the correspondence is that they have conceded that my husband has been paying regular amounts although they cannot provide a statement - and the debt has gone down to £67K as a result of the payments. But they still insist that the original debt is £75K although they cannot provide any evidence of this.

    Unfortunately, my husband has no paperwork to prove the court agreement other than his regular payments over the past 20 years although his ex-wife has confirmed to him that £26K was agreed. Likewise, the bank and solicitors have no paperwork either and they can't even provide a full statement of all the payments that have been made - including the last 2 years for some reason. We asked for full disclosure of personal information and documentation but they said that it was too long ago and they had no documents. So how can they claim a debt of £75K? We tried the court but they only hold records for 6 or 7 years.

    Any ideas on what we can do? My husband hasn't disputed the debt so cannot use the 12 year ruling but he definitely disputes the amount. I also checked if the property had been sold for a fair market value at the time and it seems that similar properties were being sold for around £40k so it was definitely undersold.

    Anyone ever been in a similar position? Thank you for any advice you can give!
Page 1
  • National Debtline
    • #2
    • 5th Oct 17, 9:31 AM
    • #2
    • 5th Oct 17, 9:31 AM
    Hi there,


    This is a difficult situation when there is no paperwork from the court case. My suggest would be to write to the court and see if they may have 'archived' any documents. It wouldn't be common practice for a court to do this, but you may get lucky. If you have a document from the court verifying the amount owed you can use that in a complaint and advise them to amend what they are chasing.


    If you are unable to find any paperwork you can still complain and highlight what happened and give as much detail as possible but without evidence it would likely fall to your word against theirs and would need to be escalated to the Financial Ombudsman Service.


    There would be no issues of limitations on this debt as regular payments have always been made, but you could consider other options to resolve it rather than negotiations. One option could be bankruptcy, but this is obviously a big decision and you will need full advice about this before proceeding. Good luck,


    Laura
    @natdebtline
    We work as money advisers for National Debtline and have specific permission from MSE to post to try to help those in debt. Read more information on National Debtline in MSE's Debt Problems: What to do and where to get help guide. If you find you're struggling with debt and need further help try our online advice tool My Money Steps
    • poppasmurf_bewdley
    • By poppasmurf_bewdley 5th Oct 17, 9:54 AM
    • 5,060 Posts
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    poppasmurf_bewdley
    • #3
    • 5th Oct 17, 9:54 AM
    • #3
    • 5th Oct 17, 9:54 AM
    Would this not be a case where a CCA could prove to be a useful tool, if the debt is some 20 years old? The company don't seem to have any records.

    I'm sure Sourcrates will be on soon to help answer.
    "Annual income twenty pounds, annual expenditure nineteen pounds nineteen and six, result happiness. Annual income twenty pounds, annual expenditure twenty pounds nought and six, result misery." Mr Wilkins Micawber in David Copperfield by Charles Dickens.
    • sourcrates
    • By sourcrates 5th Oct 17, 10:29 AM
    • 12,730 Posts
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    sourcrates
    • #4
    • 5th Oct 17, 10:29 AM
    • #4
    • 5th Oct 17, 10:29 AM
    Unfortunately a CCA does not apply to a mortgage, a secured loan yes, but not a mortgage.

    Thing is, very basically without knowing the full story, if they can’t prove the debt exists, they can’t take legal action, both sides say neither has any evidence, so in my view they are just chancing there arm, hoping you will cave in.

    With no evidence to back up either claim, I doubt it will be pursued very vigorously.

    They can’t just say “you owe me 75 grand, pay up” written evidence of liability is normally required.
    Last edited by sourcrates; 05-10-2017 at 10:33 AM.
    I'm a Board Guide on the Debt-Free Wannabe, Credit File And Ratings, and
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    Board guides are not moderators and don't read every post. If you spot an abusive or illegal post then please report it to forumteam@moneysavingexpert.com. Any views are mine and not the official line of MoneySavingExpert.com.

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    • LJB290
    • By LJB290 5th Oct 17, 11:40 AM
    • 102 Posts
    • 134 Thanks
    LJB290
    • #5
    • 5th Oct 17, 11:40 AM
    • #5
    • 5th Oct 17, 11:40 AM
    I had a property repossessed just over 20 years ago with a short fall.
    I didn't even know the house had been repossessed as my ex and his girlfriend had been living there and making payments until they apparently split up. They both left the property and no one was paying the mortgage. I knew nothing of this.
    The building society had always refused to take my name off the mortgage and replace it with his new partner but they didnt keep me informed of the state of the mortgage or allow me access to the information.

    Anyway: The shortfall letter finally arrived at my parents house.
    We sought legal advice and in the end, after several letters stating the situation, we ended up offer £1,000 and the addresses of where my ex might be hiding out.
    They only went and accepted the £1K.
    I have no idea what happened after this. I have never had any further contact from anyone (including the ex).

    This sounds like a terrible situation if no one can prove the amount owed or amount paid.
    I would be inclined to stop paying until this has been sorted out and seeking professional legal advice from a solicitor.

    Obviously my situation was resolved over 20 years ago so no idea how things might have changed....
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