Was I mis sold a second mortgage?

sclement

About five years ago I came across a local business that had been established for 30 years. It had a great local reputation and was up for sale as the owner wanted to retire. I looked into the business and did a full and concise business plan. Although ALL the banks agreed that the business was a success and a viable proposition none of them would loan the full amount of £75k that was required. I approached a broker who tried various loan companies. The gentleman at the broker told me it was difficult as many lenders won’t lend for the purchase of a business, however there was one company who "don’t really care what it’s for so long as there is equity in the house". He completed the form and sent me them to just sign and return. Subsequently and as many businesses have, turnover has dramatically dropped during the recession (which I personally don’t think is over) and to the point where overheads etc could force the business to close!! My query is this!! If the loan was refused in the first place (as I believe it should) I would not be in the position I may face which is ultimately to loose my home!! The broker completed the paperwork for me and under 'purpose of loan' they put down 'house extension' which he said would be fine.. Where do I stand legally? And can I take it further and if so, how and with whom??

MrsTinks

Well not meaning to be harsh here but YOU signed the document yes? And you read the contract which stated it was for work on an extention yes?
I have no idea if the advisor can be punished for his bad advice, all he'd need to say was that you told him it was for a house extension... You on the other hand knowingly signed something you knew was false - pushing it too hard might end up with someone at the loan company going down the "obtaining funds by deception" route if you refuse to pay it... sorry

I'd speak to a good solicitor if I were you and see what they suggest.

paddyrg

You went to the broker hoping to get the cash for your purchase. Which he did. If things were going well in the economy you wouldn't be approaching him for mis-selling would you? You wanted the money, you spent it, you owe it. That's about it, really.

opinions4u

I am meaning to be harsh.

If you think the loan should have been declined, why the hell did you apply for it?

Your debt. Your business failure. Your problem.

The broker completed the paperwork for me and under 'purpose of loan' they put down 'house extension' which he said would be fine.. Where do I stand legally?

By signing the form, the legal position is that, if it went to court, you would be guilty of obtaining funds by deception. Both you and your broker commited a criminal act and could potentially go to prison.

Peelerfart

Yes, a good sympathetic solicitor is what you need.

Personally I don't think you have a hope in hell but I just post here what do I know.

ILW

You got a loan for a house extension and then spent it on a business. I think the dishonesty is closer to home than the broker.

[Deleted User]

some people:borrow cash under false statements then want someone to blame when it goes t*ts up

CHR15

Maybe the old boy about to retire spent most of his life building a successful business and wanted it to go to good hands.

Unfortunately YOU cam along thinking it was an easy ride to riches but ballsed the whole business up. Now you are simply clutching at ridiculous straws blaming "the recession" for your poor business aptitude.

paddyrg

I think some of the posts here go beyond the scope of the question and into speculation, but we do seem pretty consistent in the "no, it wasn't mis-sold in any sense that can benefit you". And I am sorry to hear your company suffered and you lost money - I look at my own high street in Bath, we see more and more empty units where shops have not been able to stay viable.

Akom

paddyrg wrote: »

I think some of the posts here go beyond the scope of the question and into speculation, but we do seem pretty consistent in the "no, it wasn't mis-sold in any sense that can benefit you". And I am sorry to hear your company suffered and you lost money - I look at my own high street in Bath, we see more and more empty units where shops have not been able to stay viable.

Totally agree and well put.

We're all guilty of pushing boundries at some point or other in our lives. This forum i believe is to advise and help people who are sometimes in a difficult spot and not to be Judge, Jury and executioner.

ILW

Akom wrote: »

Totally agree and well put.

We're all guilty of pushing boundries at some point or other in our lives. This forum i believe is to advise and help people who are sometimes in a difficult spot and not to be Judge, Jury and executioner.

Nothing wrong with pushing boundaries, but then trying to blame it on others is a bit rich. If you take a flyer you should expect to take the consequences, be they good or bad.