Statute barred question

davebell101

Hello all,

I gave a personal guarantee on a business bank loan about 12 years ago. It was my first business and it closed with debts.

I offered a lower settlement of my guarantee to the bank, which they refused but asked we discuss further.

Nothing ever came after that letter and so a few years ago the guarantee became statute barred.

Now I have another business going well, and I hired a consultant to seek out some new bank financing. He happened to approach this same bank.

Whilst I'm certain there can still be no recourse going back the older company, there's a gut instinct to just stay clear. Yet this bank could be great for the new business current needs.

Do I need to worry about anything here - I mean even if the old issue cropped up linking to my name, there's still nothing they can enforce now? And is there any risk me putting a new business banking to them?

justcat

I would think that they will refuse you based on their own criteria. If you have debts with them, they are within their rights to not lend to you again no matter how long it has been.

poppasmurf_bewdley

Offsetting. I'm pretty sure that if you have any money with that same bank, they could offset any money you owe them against what you have now just by transferring the money out of your account(s), whether the amount is statute barred or not.

Statute Barred only means you cannot go to court for the money, not that the money isn't still owed.

National_Debtline

poppasmurf_bewdley wrote: »

Offsetting. I'm pretty sure that if you have any money with that same bank, they could offset any money you owe them against what you have now just by transferring the money out of your account(s), whether the amount is statute barred or not.

Statute Barred only means you cannot go to court for the money, not that the money isn't still owed.

This is absolutely true.

The Limitation Act bars the legal remedy, but the right to the money. This means that the lender could try and recover the money via an alternative method - such as offsetting.

Best wishes,

David @natdebtline

iolanthe07

If you live in Scotland I think your situation will be different. As I understand it, Statute Barred debts in Scotland (5 years, not 6) are written off, unlike in England & Wales.