Still owe on Secured loan after property sold :-(

ric_flair

Hi,
I've recently sold my flat for 88,000. I owe 75,000 on the mortgage.
Great you may think, but not so. I owe 23,000 to Welcome Finance on a secured loan on the property. Which mean's I'll owe 8,000 to welcome finance.
(I guess the lesson learned here is don't take out a secured loan with huge APR rates....but at the time I really needed the money and it served a big purpose.)
I've actually worked out that the 8,000 is interest only, as I actually paid back what I borrowed. Without going into a long story, I've come out of a messy relationship where mortgage payments got missed, and so did the Welcome Finance loan payments, so a heck of a lot of interest got added on top. But that's life and I have to live with it. so what I want to know is;

1. will I get into any kind of Legal trouble with WF over owing on the loan when there is no property?

2. As technically I've paid off what I borrowed plus some interest, and the remaing 8,000 is just interest, is there somehow I can get it written off (maybe get a solicitor to plead my case or something)?

I'm happy to say I have a good job with a steady decent income, so paying off the 8,000 can be done if need be. I don't want any IVA's or CCJ's...apart from a few missed payments on the above, I have no defaults,CCJ's or IV'A, and I want it to stay that way.

jonesMUFCforever

I'm surprised that Welcome finance let the sale go through without coming to some agreement with you about repaying the outstanding amount.

If it is outstanding then you don't have a leg to stand on you will have to repay what is outstanding and any other interest that will continue to accrue on it.

The only good thing is that they can't kick you out of your home - the situation now is really that you have an unsecured loan with them as their security has gone.

Did your solicitor not query the situation when dealing with the sale?

ric_flair

The reason for the confusion is that I voluntarily gave the keys back to the Mortgage company because I was in arrears. It seemed like the sensible thing to do being as I had no intention of living there anymore because of the relationship split.

So really the Mortgage company sold it and not me. Although I was plesently suprised they sold it at the going rate quickly.

Hence not *my* solicitor. Although the Mortgage company is fully aware of Welcome Fiance having a 2nd charge.

I guess the sensible thing to do it get a payment plan in place, but I was just worried if I could be in any kind of legal trouble as the property is sold and I still have some amount outstanding with WF?

ric_flair

In a follow up to my last post, the Welcome Fianance was aware the property was being sold via the Mortgage company from the moment the Mortgage company got the keys back.

jonesMUFCforever

In that case they will now come after you for the outstanding amount.
As I said earlier they have in effect now an unsecured loan.

silvercar

No legal trouble as the correct procedures have been follwoed. Welcome will agree a repayment unsecured loan with you. Don't be persuaded to agree to anything you can't afford as this will cause you hassle down the line. The ball is in your court as you have no assets to secure the loan to.