Help!!! Suspect fraud in valuation

Alan_M_2

Rachman wrote:

Perhaps she's had the broadband cut off and the financed laptop repossessed ? Well, you may as well start as you mean to go on.

What really narks me is that with the joke IVA and bankruptcy rules, she could be out of this in less time than it took her to get into it. Which is not fair on the rest of us, who look before we leap into a pond full of sharks and don't believe the person who tells us, they are not maneaters......

In what way are IVA's and Bankruptcy a joke?

Don't believe everything you read in the papers about either of these, neither are exactly an easy way out of anything.

Banks have started to tighten up on IVA's enourmously, HSBC and all it's subsiduaries will only agree to 50% absolute minimum, anything under that is forced Bankruptcy, Northern Rock are even more stringent I'll think you'll find and the entire system is about to be reviewed becasue the very people that introduced it, the banks, are now crying about the system. It was introduced as an incentive to entrepreneurs to take a risk in business, if things went wrong there's an alternative to Bankruptcy, if they simply raised the minimum limit of debt from £15,000 it would remove a lot of the nonsence.

Also an IVA does not cover any form of secured Lending, so you cannot enter an IVA as a result of mortgage default, vehicle finance or any form of finance that is secured against an asset, it is for purely unsecured lending.

Do you completely understand the ramifications of Bankruptcy? I've been very very close to this myself on two ocassions, once when I lost my house on the early 90's crash and only a few years ago when two customers went bust on me owing me a lot of money. I managed to avoid both, but it will screw your life up for 16 years, don't believe the crap that's churned out through the media.

If you want to start pointing the finger of blame, how about starting with how easy it is to get all this credit to start with, it takes two to tango and the lender should make sure they are lending responsibly as much as the borrower should do the same. They will lend knowing they will get a certain percentage of defaults, these defaults are built into their costs. It's never been any different and it never will be any different.

Rachman_2

Alan_M wrote:

In what way are IVA's and Bankruptcy a joke?

Don't believe everything you read in the papers about either of these, neither are exactly an easy way out of anything.

Also an IVA does not cover any form of secured Lending, so you cannot enter an IVA as a result of mortgage default, vehicle finance or any form of finance that is secured against an asset, it is for purely unsecured lending.

Do you completely understand the ramifications of Bankruptcy?

If you want to start pointing the finger of blame, how about starting with how easy it is to get all this credit to start with, it takes two to tango and the lender should make sure they are lending responsibly as much as the borrower should do the same. They will lend knowing they will get a certain percentage of defaults, these defaults are built into their costs. It's never been any different and it never will be any different.

IVA is a doddle to get through and take the p1ss on - the two people I know with one both lied on their forms, kept their sports cars, fabricated their living costs and will walk away having paid less than what they owe and have hardly reduced their lifestyles and are simply getting away with paying off half of what they owed. How is that not a joke ?

Do I understand bankruptcy, yes, I also know that it's effects are a lot less dramatic and long lasting than it used to be - you can 'opt' for bankruptcy like it's buying another flatscreen telly on tick now. The stigma's not there and people see it as an alternative to paying their debts, not as something that's the end game.

As for responsible lending - you see, I don't get this bit - of course there's the odd person that genuinely needs protecting from themselves and their credit, but for most of us, we are grown ups - it's making excuses for them that makes their unaffordable spending even more irritating - you are not going to try to tell me that so many of these people just lost their job, their other half was critically injured and they now can't earn - please spare me - most of them behave like kids in a sweet shop and take a child like responsibility to their money and their debt - they've got away with it with house price inflation - does not make them any smarter... - it's not an understanding of global economics that people need to have - it's simple fiinancial management....

[sorry to hear you've been close to the edge a couple of times - as you say, it used to be a scary place to be - for my sins, I have had to go to court on bankruptcy hearings before - I felt sorry for one guy, every time he tried, it went wrong - though even then (1998) most of the people I was acting 'against' were there through their own stupidity']

In all seriousness, do you think the vast majority of people who are careering towards IVAs and bankruptcy are getting there through difficult vicissitudes - or because of their lackadaisical approach and the simple fact they spend more than they earn (and live a lifestyle they don't earn).

As for effects, there are not debtors' prisons any more, you know, they get denied credit for a while (and maybe are not allowed to continue certain jobs where financial irresponsibility could compromise them) - is that a bad thing ?

Madjock

If the house wasn't worth the £250k paid for it, the valuer would have downvalued it at the time.
I don't see the point in concentrating on the fraud approach, tbh, it's just sticking your head in the sand hoping the mortgage lender/valuer/agent/solicitor will stick their hands up and say it's a fair cop guv.
What Helen needs to concentrate on is fixing the problems. Talk to your lender about how you can get back on track with your payments, or bite the bullet and sell up and pay off the debt to the lender.
I suspect that with the lender being GMAC (nothing wrong with GMAC btw, people need to be realistic about what they can afford - it's not on the mortgage lender's head to say can you afford this?) Helen has likely self-certed and inflated her income.
You need to take action because the longer you are behind and missing payments, even if you could get the property valued up to £250k, the more likely it is you will have to go for a high rate remortgage with a sub-prime lender. I'd guess that you will likely find yourself on 6.5-7%.
You should sell the property before letting the lender repossess, a 30k debt is better than a repossession.

Alan_M_2

Rachman wrote:

IVA is a doddle to get through and take the p1ss on - the two people I know with one both lied on their forms, kept their sports cars, fabricated their living costs and will walk away having paid less than what they owe and have hardly reduced their lifestyles and are simply getting away with paying off half of what they owed. How is that not a joke ?

Do I understand bankruptcy, yes, I also know that it's effects are a lot less dramatic and long lasting than it used to be - you can 'opt' for bankruptcy like it's buying another flatscreen telly on tick now. The stigma's not there and people see it as an alternative to paying their debts, not as something that's the end game.

As for responsible lending - you see, I don't get this bit - of course there's the odd person that genuinely needs protecting from themselves and their credit, but for most of us, we are grown ups - it's making excuses for them that makes their unaffordable spending even more irritating - you are not going to try to tell me that so many of these people just lost their job, their other half was critically injured and they now can't earn - please spare me - most of them behave like kids in a sweet shop and take a child like responsibility to their money and their debt - they've got away with it with house price inflation - does not make them any smarter... - it's not an understanding of global economics that people need to have - it's simple fiinancial management....

[sorry to hear you've been close to the edge a couple of times - as you say, it used to be a scary place to be - for my sins, I have had to go to court on bankruptcy hearings before - I felt sorry for one guy, every time he tried, it went wrong - though even then (1998) most of the people I was acting 'against' were there through their own stupidity']

In all seriousness, do you think the vast majority of people who are careering towards IVAs and bankruptcy are getting there through difficult vicissitudes - or because of their lackadaisical approach and the simple fact they spend more than they earn (and live a lifestyle they don't earn).

As for effects, there are not debtors' prisons any more, you know, they get denied credit for a while (and maybe are not allowed to continue certain jobs where financial irresponsibility could compromise them) - is that a bad thing ?

Banks have changed their view on IVA dramatically in the last three months, your friends who have committed what is effectively fraud will have to have been helped by an insolvency practitioner who will also have been party to this to get it through. You'll also find this changing very soon as a result of unscrupulous behaviour of these people.

Whislt the ramification of bankruptcy have been watered down a little it is still a last scenario option, restrictions on holding bank accounts, hugley difficult to obtain credit and when you eventually can obtain credit the rates will be eyewatering and the inability to hold a directorship.

Responsible lending, I think you underestimate wildly how ignorant a huge proportion of the population is, and they really do need to protected from themselves, after all if we are that grown up and able to borrow responsibly, then why do we need limits at all?

I actually agree to an extent with the debtors court although to a different degree, bouncing cheques and such should be treated as it is in France and America, it should be a criminal offence after all it's effectively obtaining goods or services by deception.

The problem is that IVA's were not desgined to be used in the manner which they are, this will change very quickly. Will this change anything? sure it will, it will reduce IVA's and increase Bankruptcy's.

I've thought about this a little more and added the following:-

In hindsight I should have gone bankrupt in the early 90's and wiped all my debt and started again, at the time I chose not to, I thought the ramifications of such would be so restrictive that it would seriously effect my ability to start a business or obtain credit in the future and to be quite frank I had so little money I actually couldn't afford the £300 Bankruptcy fee at the time.

Over the next 10 years I cleared the debt I was left with, but I was treated no differently to a bankrupt as I'd had to walk away from a property (even though I had never actually defaulted on a single payment).

The problem with the existing system is not that Bankruptcy or IVA's are easy, because they are not, no matter what you belive. The problem is that there is no advantage or "credit" given to anyone who morally chooses to deal with their debts and pay it all off. You're all just tarred with the same brush.

Alan_M_2

Madjock wrote:

If the house wasn't worth the £250k paid for it, the valuer would have downvalued it at the time.
I don't see the point in concentrating on the fraud approach, tbh, it's just sticking your head in the sand hoping the mortgage lender/valuer/agent/solicitor will stick their hands up and say it's a fair cop guv.
What Helen needs to concentrate on is fixing the problems. Talk to your lender about how you can get back on track with your payments, or bite the bullet and sell up and pay off the debt to the lender.
I suspect that with the lender being GMAC (nothing wrong with GMAC btw, people need to be realistic about what they can afford - it's not on the mortgage lender's head to say can you afford this?) Helen has likely self-certed and inflated her income.
You need to take action because the longer you are behind and missing payments, even if you could get the property valued up to £250k, the more likely it is you will have to go for a high rate remortgage with a sub-prime lender. I'd guess that you will likely find yourself on 6.5-7%.
You should sell the property before letting the lender repossess, a 30k debt is better than a repossession.

A very good friend of mine is a Chartered Surveyor, He qualified in the late 80's and was practicing in the business during the last property cycle, in a 5 year period he worked for three surveying companies. All three of these businesses went bust due to the high number of PII claims against them for misvaluation.

This was in a time when some flats were increasing at £5K a month and trying to place a value on a property at a time like this is like valuing a Dot Com during the tech bubble. The bottom line is, misvaluation if far more common than you think in a rapidly increasing market.

It isn't down to the OP to persue this, the lender will actually do it, as the value was processed on their request.

Rachman_2

Alan_M wrote:

B
In hindsight I should have gone bankrupt in the early 90's and wiped all my debt and started again, at the time I chose not to, I thought the ramifications of such would be so restrictive that it would seriously effect my ability to start a business or obtain credit in the future and to be quite frank I had so little money I actually couldn't afford the £300 Bankruptcy fee at the time.

Over the next 10 years I cleared the debt I was left with, but I was treated no differently to a bankrupt as I'd had to walk away from a property (even though I had never actually defaulted on a single payment).

And trying not to sound like a patronising git, well done for tackling the problem and dealing with it - a lot of people would have not stuck it out.

As for its problems - I have been recently acting for a guy who's been inside for wire fraud when he was a stockbroker - he's had no problems finding banks willing to lend him £500M...... - genuinely, it's not what it was as a stain on your character having been bankrupt....

BT_man

I don't think she's coming back...
Hope she enjoyed keeping up with the jones' whilst she could...

magyar

Alan_M wrote:

If you want to start pointing the finger of blame, how about starting with how easy it is to get all this credit to start with, it takes two to tango and the lender should make sure they are lending responsibly as much as the borrower should do the same. They will lend knowing they will get a certain percentage of defaults, these defaults are built into their costs. It's never been any different and it never will be any different.

Alan, I've thanked you above because I agree with everything else you said, but not this bit.

Why is there always someone else to blame other than the mug who fell for something? I appreciate you pointed out it takes two to tango, and of course we need to protect people from fraud/deceit etc., but if people borrow more than they can afford it's their fault, and no-one else's.

Alan_M_2

When you're in the realms of financing Half a Billion pounds, bankruptcy is likely to be pretty irrelevant.

However for the other 99.999% of the population this just isn't the case is it.

After all our government continues to lend Billions of pounds to third world countires, which, if we're honest we haven't got a hope in hell of getting back have we. Oh that's until they have their next skirmish with a neighbour and we get to re arm their military. Which they pay for with the money they're borrowing from us.

Alan_M_2

magyar wrote:

Alan, I've thanked you above because I agree with everything else you said, but not this bit.

Why is there always someone else to blame other than the mug who fell for something? I appreciate you pointed out it takes two to tango, and of course we need to protect people from fraud/deceit etc., but if people borrow more than they can afford it's their fault, and no-one else's.

Again, like many people who post here, you're assuming people are intelligent enough to know this and that's the problem. This is why parameters exist for terms of lending and it's as much the responsibility of the lender to say no as it is for the borrower to be certain that they can afford it.

Really you'd be astonished at how uneducated a large proportion of the population is. This is the reason banks have lending criteria, it's there to protect their investment and also to protect the consumer from borrowing more than they safely should.