Employee loan help !

[Pauline2023]

Can anyone help please
so my husband took out a loan with his employer to buy a motorbike and has had no problems paying this back over the last 18 months and I quote from his boss ‘has been a brilliant employee since working there for nearly 4 years’
Over the last 6 months he has really struggled physically with the long driving and heavy work whereas he is now needing physio regularly for shoulder and neck issues. ( no time off sick either )
To cut a long story short he has been offered a new job and is currently working his notice. His boss originally said they could come to an agreement re continuing to pay the loan, however he has since backtracked and said it needs to be paid by the end of Aug which equates to £4000. He plans to deduct all of my husband final salary which would not come close to clearing the loan and we wouldn’t be able to pay our rent, and other priority bills. We have politely explained this in a formal letter and even disclosed an income /outgoing statement. My husband will need the bike for travel to his new job as he currently has a company van that will be returned so it’s not like we could sell it to pay the loan which if we sold the bike wouldn’t clear the loan anyway. There is zero public transport to his new job either as it’s in a very remote location. Can’t get a lease car as he would be in the initial probation period. We are fast running out of options. Family are pensioners so can’t help either.
We offered to increase the monthly payments by an extra 50% to clear it as soon as possible. The company refused and plan to take his entire salary despite the fact that this would cause significant financial hardship and we would risk eviction eventually as a months rent is a lot to try and make up !! It would take us months and our landlord isn’t the most empathetic. The knock on effect from this would be huge and we really don’t know what else to do. My salary alone would no where near cover the rent and priory bills and we don’t want to start getting in to arrears with things it’s taken years to sort our finances.
We are not able to get a loan via the usual channels as we have historical credit issues although resolved are still on credit file.
if they take the whole salary he would still owe his employer about £2000 of the loan and we couldn’t pay this as we’d have no spare income as we would be trying to make up the rent ect so it’s really shortsighted
We have tried and tried to agree a repayment plan we can afford but he just won’t budge. Basically if he takes it he will have to take my husband to court for the rest so no one is a winner here
any suggestions would be appreciated

[atticus]

Start with the terms of the loan agreement. These things typically provide for the balance to be repaid in full if the employee leaves before the loan is paid off, including by deduction from wages.

Might it be possible to take out a loan so as to repay the outstanding balance to this employer?

[Pauline2023]

Unfortunately not or we would of done, this is the problem, don’t really know what else we can do, we have really tried and it’s all very amicable but the employer won’t budge despite saying he is wiling to come to an agreement as long as it’s on his terms which are simply unaffordable

[ULA]

Is there clear documentation about the loan, monthly payment terms to be deducted from salary and what would happen in the event your husband left the company, for whatever reason, to the repayment of any balance owing.

What is said in that document in regard to repayment if your husband leaves before the loan is repaid.

[Pauline2023]

Thanks for replying, yes it was stated in the event of leaving the loan would need to be paid in full. We tried so hard to arrange a monthly repayment but they would not accept it. Luckily we have this documented in emails. We explained about not being able to pay the rent if they took his entire salary we asked for more time to sell his motorcycle to be able to repay but all rejected.
He has since left at the end of Aug as planned and he received zero salary for the whole of August despite working it he’s had no payslip or any correspondence at all from them. He has no idea how much he earned or paid towards the loan. No idea how much is outstanding at this point. On the 5th sept he received a court summons. So just 5 days after leaving !! This has meant no chance to even be able to try to raise the money. We had to borrow from family just to pay the rent.

We have acknowledged the claim and agreed he owes some of the claim but we want to submit a defence due to lack of reasonable time to repay, but not sure if we can use some of the following No statement of loan repayments, or final request for the loan, no salary ect. Significant financial hardship this has caused and could if risked our home should a family member not stepped in.
we will be repaying family back and playing catch up with other priority bills once he receives first new salary so now can’t afford to pay his company much back. It’s such a shame this has had a significant impact all of which could have been prevented if they only agreed a monthly repayment !

[PallasAthena]

That's remarkably speedy for a court.

Please can you upload onto here a copy of the court summons received. Before doing so cover up your name and address and the employers name and address and all reference numbers and bar codes that could identify your husband or his ex-employer.

Don't panic and get into further debt borrowing money to repay the ex-employer. Generally speaking you can agree that you owe the debt and make a proposal to the court to pay it in installments. A court will not order you to pay more in monthly installments than the court believes you can afford.

[atticus]

Is this connected with this thread by Edwardbit? https://legalbeagles.info/forums/for...nd-court-claim

[Pauline2023]

Yes I posted this at the beginning apologies husband posted a while after not realising *♀️ I’ll ask him to remove as don’t want to take up valuable time from helpful people

[atticus]

Well, I am sorry to say that I have seen nothing in this thread that amounts to a defence. See what I have said to your husband: do look at the loan agreement just in case it offers an argument.

[Pauline2023]

It just seems so harsh expecting someone to repay approx £4000 in a matter of days, there has been no prior warning of court action, surely he should have given some notice ? they clearly must applied for court before he’d even left but no mention of this at all. He could have made up what is owed as zero correspondence regarding the amount too or what’s been paid.
the only the thing the agreement says is to be repaid when leaving. In a face to face with the company before all of this he verbally said oh we can come to some agreement but clearly that means nothing
ultimately this is going to result in a ccj and 6 years of damage on his credit file making life very challenging for the future

[PallasAthena]

Please post the court document on here as requested earlier.

[Pauline2023]

Please see attached court form
thank you

[atticus]

As expected, the Claim Form cites a loan agreement, with particular reference to clauses 3.3 to 3.5.

[PallasAthena]

If you are going to agree that you owe the full debt the court pack should allow you to give details of your finances and make a proposal for paying in installments.

[bazdvd]

is selling the motorbike to repay the loan an option?