mortgage guarntee

kayleigh10

Hi can anyone help my husband and i have signed an all monies mortgage because he is self employed.
Some years later he started a ltd company of which he signed a guarntee for his overdraft.
Last year he went bankrupt because of the collapse of the building trade.
Bank want to take us to court because we are unable to pay our overdraft off.
I did not sign guarntee and would like to settle for a less amount with the bank.
How do i stand if this goes to court and will all of the legal cost come of any asset left in the house.

Trollfever

Suggest that you post on the Debt Free Wannabee Board:

http://forums.moneysavingexpert.com/forumdisplay.php?f=76

I see from your other thread that he is bankrupt so would suggest the Bankruptcy Board:

http://forums.moneysavingexpert.com/forumdisplay.php?f=136

Radiantsoul

The law around this is fairly complex, because although you didn't sign the guarantee the all monies charge means that the bank can sell the house to pursue the debts of either one of you. There are a whole stream of cases around similiar issues, but in reality the banks security ought to stand unless the all monies charge was very, very old.

The position is the bank can repossess the house and use the proceeds to settle the guarantee and any otther secure borrowing. All legal charges would be deducted from the sale proceeds. However you personally would not be pursued for any shortfall after the sale as you are not liable or party to the guarantee, it is rather like the house is liable rather than you.

If you make an offer and the bank accept it then this would be in full and final settlement. But to be attractive the offer will need to be close to the equity in the property(value of the property less any mortgages granted prior to their charge).

It is hard to give specific advise without figures, but a bank will sell quickly and for less and charge you for their time and agents. So if there is a possibility of their being a surplus then I would do it yourself and try to deal with the bank.

Senior_Paper_Monitor

Spot on post Radiant (with the limited info available) - one point to consider is that extra protection for the OP's share may be achieved if ownership is 'tenants in common' rather than 'joint tenants' (unfortunately this is not often the case) and even this may be jeopardised if. the OP was in any way actively involved or even in any way aware of the husband's activities/actions.

It is not quite clear (at least to me) whether the 'all monies charge' relates to the mortgage lender or the business lender or both (or if they are the same party - a common tactical mistake)

Specialist qualified legal advice specific to the case is probably advisable.