bank asking back for loan

bassmonster

Hello all,
I'd really appreciate some advice.
Basically, my father in law (fil) who is 65 years old took out a secured loan for £185k about 3.5 years ago with Natwest who he has banked with for 22 years. He secured the loan on a freehold property where he also runs his restaurant and has been for those 22 years. His repayment to the bank for these many years has never ever been late, always on time. My fil has now fallen ill and needs a heart bypass so he decided to lease off the restaurant for 25 years. When his bank heard this, they have demanded the full payment balance which is about £175k in one lump sum to be paid within the year or they'll take possession of the property which i find rather surprising. The reason the bank manager gave for this by word of mouth is that they don't have any confidence in the new people taking over the restaurant. Surely, if the payments are always on time, it shouldn't be an issue? is the bank allowed to demand payment like this? as far as i know, no terms and conditions have been broken in conjunction with the secured loan.

Is the bank just thinking "this guys probably going to die very soon so let's just take our money back"

Is the bank acting improperly/illegally? can anything be done? what actions can be taken?

Thank you for reading..

jonesMUFCforever

Nat West probably have a legal charge over the property. It will be in the terms and conditions of the loan that OP would have to have express permission of the lender before renting out the property - if they do not agree to this then yes they can ask for their money back.
The alternative is that he re-mortgages again.

bassmonster

Thank you for the reply. For the sake of argument, say such clauses are not in the terms of conditions that any subleasing is prohibited, can the bank still demand the money?

what is OP?

ILW

Virtually all business loans have a repayable on demand clasue.
Also I am very surprised that he managed to sell a 25 year lease on a property which had a charge on it.

jonesMUFCforever

bassmonster wrote: »

Thank you for the reply. For the sake of argument, say such clauses are not in the terms of conditions that any subleasing is prohibited, can the bank still demand the money?

what is OP?

OP the original poster - someone who started the thread.