Friend being threatened by Lloyds

blue_bee

My friend (honest!) took out a £50,000 loan with Lloyds about 10 years ago and was paying £450 per month. They had a car accident last year and without a written agreement (and having been injured, not sure of the future) paid just £250 for 3 months. Then they carried on paying the £450. Lloyds has now written saying they defaulted on the loan and as it is secured against their house, they must come up with all the money within 28 days, or Lloyds will sell the house.
Their other bank has said that Lloyds cannot do this but they clearly are! They are panic stricken as they cannot find £14,00 just like that (especially as since the accident the husband has not been able to work regularly)
I have suggested they goto the CAB but the local branch has nowhere private to talk. I'm sure there must be a due process and have reassured my friend that they won't have to leave their house in 28 days but what is the position? Having no spare money they are loathe to go to a solicitor at this stage.

Fruit_and_Nut_Case

blue_bee wrote: »

My friend (honest!) took out a £50,000 loan with Lloyds about 10 years ago and was paying £450 per month. They had a car accident last year and without a written agreement (and having been injured, not sure of the future) paid just £250 for 3 months. Then they carried on paying the £450. Lloyds has now written saying they defaulted on the loan and as it is secured against their house, they must come up with all the money within 28 days, or Lloyds will sell the house.
Their other bank has said that Lloyds cannot do this but they clearly are! They are panic stricken as they cannot find £14,00 just like that (especially as since the accident the husband has not been able to work regularly)
I have suggested they goto the CAB but the local branch has nowhere private to talk. I'm sure there must be a due process and have reassured my friend that they won't have to leave their house in 28 days but what is the position? Having no spare money they are loathe to go to a solicitor at this stage.

So they underpaid by £200 per month for three months? Total underpayment of £600? Right?

Where do you get this £14,00 (sic)? Is this the bank's calculation of the balance?

meer53

Here's a novel idea - get your "friend" to speak to Lloyds ?

The fact is, they did default on the loan, they need to discuss it with Lloyds before anyone else. Did they agree to make reduced payments with Lloyds ? If not, that was their big mistake.

Sinhanada

I'm assuming that the £14k is the balance on the whole loan and not the amount that was underpaid.

Does your friend have anything in writing from the bank showing that it was ok to pay a reduced amount?

I am also sure that Lloyds would have written to your friend prior to this as repossessing the house would be the last point of call for them. Did your friend ignore these letters?


My suggestion is to contact Shelter (https://www.shelter.org.uk/) as soon as possible and ask for their help.

antrobus

blue_bee wrote: »

My friend (honest!) took out a £50,000 loan with Lloyds about 10 years ago and was paying £450 per month. They had a car accident last year and without a written agreement (and having been injured, not sure of the future) paid just £250 for 3 months. ...

Your friend is an idiot. What was it about the statement "Your home is at risk if you do not keep up repayments on a mortgage or other loan secured on it" that they failed to understand?

blue_bee wrote: »

.... Lloyds has now written saying they defaulted on the loan and as it is secured against their house, they must come up with all the money within 28 days, or Lloyds will sell the house.
Their other bank has said that Lloyds cannot do this but they clearly are! ...

Their other bank is staffed by idiots. Your friend has defaulted on the loan and Lloyds are perfectly free to seek repossesion.

blue_bee wrote: »

....I have suggested they goto the CAB but the local branch has nowhere private to talk. ...

Tell your friend not to be so picky. Their home is at risk.

blue_bee wrote: »

....I'm sure there must be a due process and have reassured my friend that they won't have to leave their house in 28 days but what is the position? Having no spare money they are loathe to go to a solicitor at this stage.

There is. Lloyds will have to go to court to reposses the house. As a general rule, the courts are reluctant to 'throw people out of their homes' if there is any kind of alternative. Now is the time for your friend to come up with that alternative. As in a plan to clear the arrears etc.

Sinhanada wrote: »

....My suggestion is to contact Shelter (https://www.shelter.org.uk/) as soon as possible and ask for their help.

Seconded. They have some tips here - http://england.shelter.org.uk/get_advice/repossession/top_tips_avoid_repossession - and an advice line.

Note that their No 1 tip is "Talk to your lender straightaway"

PeacefulWaters

Lloyds has now written saying they defaulted on the loan and as it is secured against their house, they must come up with all the money within 28 days, or Lloyds will sell the house.

Well that's the end game. But it's not what the letter says.

It says that they will commence possession proceedings. That will take longer than 28 days and is unlikely to be granted given the arrears are less than two monthly payments.

without a written agreement (and having been injured, not sure of the future) paid just £250 for 3 months

It's good to talk. They should try it now.

The big bad bank may be a tad more helpful if their customer explains the problem.


Or, summarised, TELL YOUR FRIEND TO RING LLOYDS AND TALK IT THROUGH INSTEAD OF BURYING THEIR HEAD IN THE SAND!

blue_bee

Thank you for your responses. Yes apparently the £14,000 is what they owe now having paid it down over the years. They are not burying their heads in the sand. They have received emails from a woman at Lloyds who is most unpleasant and threatening from a main office in Birmingham. They have tried to speak to her, she is not helpful at all. I think we all know the type.
They went to see the ex-manager of their local Lloyds who they know well. His response was that he is so sickened by the way the bank now treats their customers that is is leaving. He suggested they try and find the £14000 and get out.
The husband went and paid less at a time when he had just been in a severe car crash (yes, probably wasn't thinking straight) and his wife did not know that he'd done this. She rang me this morning at her wits end because he's trying to sort it and doesn't want her doing any more (it was her bank, HSBC I think they went to see yesterday).
I said I would try and find out where they should get help. I too have said I am sure there will be a court process but just though members here might know the exact position. Yes he was daft, but it's not as though he suddenly stopped paying anything. They are a couple in their early seventies and I just feel this is wrong.

blue_bee

Sinhanada, thank you very much for the Shelter recommendation. I've had a quick look and there's loads of excellent information. I'll ring her tonight. I think the problem now is her getting to the computer and then acting on anything without him going ballistic. He's a proud man who wants to sort it himself.

Bantex_2

Why are they talking to HSBC when the issue is with Lloyds

meer53

It's ok to be proud but can you not make him see that if he wants to sort this out himself, however unpleasant he feels this woman in Birmingham is, he needs to speak to her to sort it out.

If he won't do this, then they risk losing the house. Simple as that.

JimmyTheWig

Bantex wrote: »

Why are they talking to HSBC when the issue is with Lloyds

Presumably to try to get the £14k to pay off Lloyds.