Property Charge - Help needed !!

Laurenj_2

I'm not sure if anyone can give any advice on the following but anything is appreciated.

My father had a charge of £12000 placed on to our family home due in 1994 to failing to repay a loan. My mum signed the papers to allow the charge to be placed but neither have received any other correspondance.

My parents separated three years ago and my mum shortly after filed for divorce, as part of this they had to make decisions of a financial nature and my mum's solicitors wrote off to gain information regarding the charge on the property. It was only when they received a reply that my mum was made aware of interest that had been accruing on the charge. The balance now stands at £36,000 and is increasing on a daily basis.

My mum tried to gain more details on the charge but was told that as it wasn't her debt they were unable to tell her anything. However, they will not remove the charge from the property and will not freeze the interest and if she were to sell the property they would take out the balance from the proceeds of the sale.

My mum is finding it increasingly difficult to cope with the stresses and hope someone can advise me on how I can be of help to her. Her solicitor has contacted them on several occassions and they responded either saying they are not calling in the debt or that the account wasn't my mum;s so they cannot divulge any information.

Thank you in advance

Lauren

Uniscots97

Ask the solicitor if your Mum has inherited the debt if she gains the house. If not then ask the solicitor to sort out separating the debt from the property and making the company aware that your Dad is liable for the payment and its been separated from the property. Make the solicitor work for his/her money. They should be able to help you out here. Good luck.

Uniscots97

Meant to also say that if your Mum can prove your Dad took out the loan in his name alone (not joint) then I believe she can ask him (legally) to assume ownership and repayment of the loan and ask for her name and credit record to be cleared of that against her. Check with your solicitor though.

Dr.Shoe_2

Ask for a copy of the original credit agreement and the charge under the DPA enclosing £10. If they fail to provide this they cannot enforce the charge and they could be committing a criminal offence.

CLAPTON

why can't your father follow the matter up ?

silvercar

My father had a charge of £12000 placed on to our family home due in 1994 to failing to repay a loan. My mum signed the papers to allow the charge to be placed but neither have received any other correspondance.

Only two ways a charge can be placed, eith by the property owners agreeing or by a court imposing. As your Mum signed the papers it must have been by both your parents agreeing, in which case they are jointly liable.

Whether the whole loan including interest or just the original amount is secured on the property, a solicitor will be able to tell you.

The loan people are unlikely to agree to transfer the charge to an unsecured loan as this provides less security for them. They will suggest that you borrow other money to clear the charge, whether you can persuade your father to do that I don't know.

This whole amount needs to be settles as part of the divorce, be prepared for one side to say it was money incured in running the house etc and is a joint debt.

Sorry! Would suggest that you try and pressurise the company to freeze the interest. I would want ot know why no repayments have been made? Was it an equity release scheme ie it is deliberate that the interest builds up until the property is sold?

Bossyboots

Has your father got a solicitor? If so, that solicitor needs to apply to the company for all the details of the debt. Your father can sign a form enabling the company to give his solicitor the details.

What should happen now is that the debt should become part of the financial settlement so in theory deducted from father's share of the proceeds. This is something the solicitors need to sort out between them but even without the charge on the property, the chances are the house would have to be sold for each to take their share unless she could afford to buy him out. Unless the debt is paid or other arrangements made (like the debt being transferred to another property which would be unlikely to be agreeable) then it is pretty much stalemate and something that really only the couple and/or their solicitors can sort out.

As far as helping her, at the moment she needs to check with her solicitor that father's solicitor has been asked to investigate the debt and ask for disclosure of the account. This is all part and parcel of matrimonial settlements anyway so at some stage the details will be needed.

Laurenj_2

Unfortunately for my mum my father is being less than co-operative and she can rarely find where he is living. He has little contact with my sister and no contact with myself.

As I understand it the charge was signed for by my mother as my father told her we wouldn't be able to move to a bigger house if she didn't agree, being the naieve one that she is she believed him without questioning it.

There have been no repayments made towards the debt as the company have never approached neither my mum or dad for payments and are still maintaining that they do not need the debt repaying. They seem to be happy enough to allow the interest to increase.