BTL £6m loss prompts calls for law change

CLAPTON

Generali wrote: »

I don't understand what would be added to the process of collateral forfeiture by the Government getting involved or indeed what posters think would be gained by tearing up millions of loan agreements.

If you don't like the terms of the contract, don't sign it.

The government (the law) is already involved; it seems you are really saying that the status quo is adequate.

Conrad

Generali wrote: »

I don't understand what would be added to the process of collateral forfeiture by the Government getting involved or indeed what posters think would be gained by tearing up millions of loan agreements.

If you don't like the terms of the contract, don't sign it.

A small business experiencing financial turbulence is very unlikely to be in a position to contemplate expensive law courts fighting again vastly more powerful lenders that wont always be making the most just of decisions.

There are times like this when a little more balance in the system is for the good.

purch

Not sure why we need any references to Chapter 11, the UK system of Administration is similar, and is a clear example of the state/courts interfering in a commercial contract. (the only real difference is that in the U.S. the incompetent management who got the company into financial difficulties get to continue to run the business, whereas in the UK an administrator is appointed).

The article doesn't say how this BTL'er organised his "business", but if he was in difficulties putting his affairs into administration earlier would have averted the problem he now faces.

Allowing lenders to appoint receivers without first putting the company into administration is unjust by just about any measure in my view.