very worried about my dad

catdavlee

Hi there its been a while since last on and everyone was a great help b4 im hoping someone can help again, my husband has now joined the BR club on the 24th of March but we are very worried about my dad unfortunately he was a guarantor on a loan of 25k and there is still 14k outstanding we know the bank will chase my dad for it but he has no money he lives on a pension of about 100 pound a week am i right in thinkin they will have to do an assessment of his income and out goings as to wot he can afford to pay i have told him no matter wot i will pay it but i cannot afford the 641 pound a month that it is now my dad is 62 years old and obviously worried himself. My husband feels so bad that this has happenned and he tried everything to avoid bankruptcy but unfortunately he lost the pub he had as the pub company gave him no help at all. Any advice or help regarding the situation with my dad would be greatly appreciated

Many thanx

nervousmother

Does your dad own his own property or is it rented? if it is rented the best course of action would be to leave the loan company to it, let them approach him and then him offer a small token payment, other options for him would be the new DRO but it depends if he wants to go through something like that at his age, of course it would be a bargaining tool when talking to the bank..'if you dont accept my offer then i will have to go BR/dro' see if he can get a debt agency involved to help him,
If he owns his own property the bank may end up putting a charging order on it they would then recover the money once it is sold,
It is not a good position to be in, I must admit after working where i do I would never act as guarantor for anyone.
It could take the bank ages to contact him, I would suggest you and hubby do your best to pay dad back some money if he ends up paying on a monthly basis.
Another course of action if dad could afford to would be to offer an amount as full and final settlement, I have heard banks settle for stupid amounts of money.

Try not to feel too guilty about what has happened, your dad should have known what would have happened if you defaulted on the loan, you cant change what has happened and now is the time to put all energys on trying to sort things out.

Radiantsoul

Are you bankrupt too? Is the loan joint with you and your husband? Did the bank take any security against your dad's assets? Does your dad have any assets? Is the bankruptcy likely to realise anything for creditors? Have they issued demand under the guarantee?

Without assets there is not much the loan company can do. Assuming they contact him he should ask to see a copy of the guarantee(guarantee have to be in writing) and see what interest rates/repayments are required.

catdavlee

Hi Thanx for the replies i will answer both sets firstly my dad is in rented accomodation and has no assets wot so ever. The problem we have with the whole situation is that wen my dad and husband (i was there too) were in the office signing up for the loan before my dad signed anything he specifically asked whether he would be liable and the lady dealing with it said profoundly NO he said that if he was he would under no circumstances sign and she assured him this was not the case. Also the bank would only loan the money to my husband if they could take charge of the lease on the pub and this was agreed to by the pub company but the pub company are now denying this even though the lease is with the bank. The pub compny are saying that because my husband had to close the pub he forfieted the lease. I myself am not bankrupt but due to the pub closure i am now out of work. Sorry to ramble on but another question I have is does my dad wait til the bank contacts him because as yet my husband not had meeting with OR, that is on the 22nd of April will the bank already know about the bankruptcy he has had a letter about the missing payment though and asking him to settle in full.

ILW

Sorry to be a bit blunt, but what did your dad think he was signing?

nervousmother

Seems the bank has acted poorly, going over the past wont help things now, concentrate on what is next.

They will at some point contact your father, how old is the loan? when they do contact him he needs to ask to see the origional paperwork, if he tells them he does not believe he is guarantor and they cant provide the origional paperwork and of course the loan is over a certain age it may not be a proovable debt if they cant supply the documents.
Failing that then he may have to do a DRO, it does not cost as much as BR.

Radiantsoul

catdavlee wrote: »

Hi Thanx for the replies i will answer both sets firstly my dad is in rented accomodation and has no assets wot so ever. The problem we have with the whole situation is that wen my dad and husband (i was there too) were in the office signing up for the loan before my dad signed anything he specifically asked whether he would be liable and the lady dealing with it said profoundly NO he said that if he was he would under no circumstances sign and she assured him this was not the case. Also the bank would only loan the money to my husband if they could take charge of the lease on the pub and this was agreed to by the pub company but the pub company are now denying this even though the lease is with the bank. The pub compny are saying that because my husband had to close the pub he forfieted the lease. I myself am not bankrupt but due to the pub closure i am now out of work. Sorry to ramble on but another question I have is does my dad wait til the bank contacts him because as yet my husband not had meeting with OR, that is on the 22nd of April will the bank already know about the bankruptcy he has had a letter about the missing payment though and asking him to settle in full.

When your husband went bankrupt the lease would have been forfeit I'm afraid. So that offers no source of repayment of the loan.

The bank will write to him with a letter of formal demand which will look something like "I write with reference to the loan dated....on which you gave a personal guarantee on....the bank now formally demands repayment of the outstanding liability of £x. Interest will continue to accrue at y%."

Your father can't pay and so there are two options open to the bank,
1. bankrupt him
2. pass his case to a debt collection agency which might collect a few pounds a week.
3. try and get an offer in full and final settlement.

My guess is they will try option 3, threaten option 1 and then do option 2.

Radiantsoul

nervousmother wrote: »

Seems the bank has acted poorly, going over the past wont help things now, concentrate on what is next.

They will at some point contact your father, how old is the loan? when they do contact him he needs to ask to see the origional paperwork, if he tells them he does not believe he is guarantor and they cant provide the origional paperwork and of course the loan is over a certain age it may not be a proovable debt if they cant supply the documents.
Failing that then he may have to do a DRO, it does not cost as much as BR.

I am not sure the age of the loan is relevant. But all guarantees need to be in writing(unlike many legal contracts).

catdavlee

Yes we did know wot guarantor meant but the bank specifically stated my dad would not be responsible my husband didnt expect this to happen and nor did he want it he had the loan for 4 years and there is only a year left on the loan. This has been one big nightmare for everyone involved and like i said before the bank took charge of the lease as security but now the pub company are saying it doesnt count

catdavlee

could you tell me what you mean by in writing as i have found original loan agreement and cant see anything at all

angelacollman

Hi catdavlee,

When your dad agreed as guarantor for you, he actually trusted you. In actual terms $ 25000 is been used by you. so it's your duty to pay any how. you are defiantly younger then your dad, So it's your humanity to take the responsibility, but instead you are still looking your dad to pay your dues.
I don't agree with your temperament.

Regards
Angela