Tweet
Bank Guarantee & Mortgage Debenture
Hi, I would be most grateful for any advice.
A friend has a problem with a bank that has been hanging over her for quite some time. It relates to a guarantee and to a mortgage debenture.
She was a director and company secretary in her then husband's business.The bank manager asked her to sign what she now understands to be an unlimited guarantee in 1984. This guarantee was secured with a mortgage debenture at the same time linked to a property in her ownership. She took no legal advice at the time, and indeed, the bank manager said she did not need legal advice.The overdraft then stood at £25,000.
In 1990 the company went into receivership because the bank withdrew its support. The bank then called upon my friend to pay the shortfall i.e. some £196,000.
In 1996 a writ was issued for the guatantee and with interest this amounted to £349,000. A defence was served at the time and this focused upon the legality of the guarantee.
In 1998 proceedings petered out but the advice she has received both then and since leave her unclear as to her position.
She has been told that the guarantee probably has timed out but as the original writ did not include the mortgage the bank could at any time issue a writ for the mortgage. Incidently, the bank hold the deeds to the property.
She was notified regarding interest in 1992 and 1993 but nothing since and no contact with the bank since 1998.
Her questions centre on her ongoing liability to the bank, on any interest that might be acruing and on what might happen if she were to ask for the deeds so that she can sell the property.
Regards,
Brian.
A friend has a problem with a bank that has been hanging over her for quite some time. It relates to a guarantee and to a mortgage debenture.
She was a director and company secretary in her then husband's business.The bank manager asked her to sign what she now understands to be an unlimited guarantee in 1984. This guarantee was secured with a mortgage debenture at the same time linked to a property in her ownership. She took no legal advice at the time, and indeed, the bank manager said she did not need legal advice.The overdraft then stood at £25,000.
In 1990 the company went into receivership because the bank withdrew its support. The bank then called upon my friend to pay the shortfall i.e. some £196,000.
In 1996 a writ was issued for the guatantee and with interest this amounted to £349,000. A defence was served at the time and this focused upon the legality of the guarantee.
In 1998 proceedings petered out but the advice she has received both then and since leave her unclear as to her position.
She has been told that the guarantee probably has timed out but as the original writ did not include the mortgage the bank could at any time issue a writ for the mortgage. Incidently, the bank hold the deeds to the property.
She was notified regarding interest in 1992 and 1993 but nothing since and no contact with the bank since 1998.
Her questions centre on her ongoing liability to the bank, on any interest that might be acruing and on what might happen if she were to ask for the deeds so that she can sell the property.
Regards,
Brian.
Comment