Is my loan application valid???

ChrissyP_3

HI all, new to the site today and hoping for some advice. In 2002 I enquired about a loan from the Coop for some funding for my business. I had a window showroom I wanted to re-fit and I approached a few companies. I explained over the phone what I needed the money for and I decided to go with the Coop. The paperwork was sent out and I duly signed it and sent it back. A couple of years later I parted company with the firm and left it to my business partner to run and he then went under 6 months later and closed the business. In 2006, after hearing nothing for 4 years i was contacted by a debt collection agency chasing me for the money for the loan which turned out to be a personal loan in my name. I refused to pay claiming it was for the business and subsequently got a CCJ and then last year got a court order placed on my property. I have tried explaining that the loan was accepted by the coop as a business loan for my company but they say the paperwork says otherwise. I have received the original signed document from the Coop for me to look at and there is absolutely no reference to what the purpose of the loan was for and so they are saying its my word against theirs. I wanted to know if anyone knew if a loan document HAS to state the purpose of the loan on it to make it valid. The debt is £13,000 pounds and rising by 10% each year and I cannot afford to pay it. Any advice on this matter would be greatly appreciated.

redpete

It sounds like the loan was in your name regardless of the purpose of the loan and it is therefore your responsibility. Did you defend the CCJ, it seems the court was satisfied that the debt is yours and not the business's.

If it was in the name of the business and you had no personal guarantee for it you might be able to claim you are not responsible for it but it doesn't sound like that was so.

CLAPTON

was the loan made to a limited company or to a person?
if it was made to a person then its a personal loan
if made to a limited company (with guarantor ) then it's a business loan

and no there is no law that says the purpose of the loan must be shown

Tixy

As others have said if its in your name you are responsible for the loan.

Any advice? - come to an arrangment to pay what you can afford each month so that the debt is decreasing not increasing.

KingElvis

Yep, you're onto a loser here, your argument isn't valid I'm afriad.

I would come to a payment plan with them.

paddyrg

Even a business loan may have had (indeed probably did have) a personal guarantee clause so they can pursue you personally for business defaults.