Lenders are abusing exemption clauses to make loan agreements fit into unregulated

[Amethyst]

Re: Lenders are abusing exemption clauses to make loan agreements fit into unregulat

Ridiculous situation isn't it.

[cul8rm8e]

Re: Lenders are abusing exemption clauses to make loan agreements fit into unregulat

I know of someone very close to me who has been put in a mess with the unregulated secured so called commercial business loan.

I cant go into anything at the moment but, It doesnt take a rocket scientist to work out exactly how these guys have carried out their business, they aint that clever, they think they had everything under control and set in stone but when you dig deep cracks appear

The contract itself was written by no other than Stephen from WESTONE LOANS. Stephen really didnt take to kind to it when approached. The thing is, these guys simply dont give a toss about anyone, they see the £ and want them, no matter what the effect on anyones lives.

Judgement day is getting close for these guys and they just wont know whats hit them, they think they have it under control, well, sorry but i have every intention to bring them down and have their licence removed. it will be epic!, but anyway, heres a very simple insight into what happened.


Borrower contacts financial adviser/property development manager at very well established company for help to fund a small property development project.

Adviser finds it difficult to find a lender to fund project from start to finish but offers a solution to use two lenders, first lender to wind/watertight stage and the second lender would take over. After considering the financial outlays the adviser was asked to contact both lenders to see if either would consider taking on the full project over the timescale the borrower required. To cut a long story short, this didnt materialise and the Borrower went ahead and started the process of dealing with the using of two lenders.

IT WAS MADE VERY CLEAR TO THE ADVISER THAT ON NO ACCOUNT WOULD ANYTHING BE CONLUDED WITH THE FIRST LENDER UNTIL IT WAS FOR CERTAIN BOTH LENDERS WERE ON BOARD AND WILLING TO LEND AT EACH STAGE!

The adviser was the moddleman in all dealings and produced terms from the fist lender, expensive but expected and accepted. The fist lender required an application fee £1000 but this was no paid until terms were produced by second lender as the adviser was told. the adviser produced the tems of the second lender (more about this later) and everything was in place so the first lender app fee was paid. As far as the borrower was aware of at this time, the adviser done a good job to put things in place but to be known later on, the aviser was a good friend and ex employee of the first lender, i will get to that part later.

Anyway, everyone was happy. After signt meeting with the first lender, the first stage funds were released to get started.

When the first stage was complete and a stage certificate produced by NHBC by the company who was the main contractor building the property this is when things started to go downhill.

The first lender decided he wanted not a stage certificate but an absolute guarantee that a structural warranty would be provided at the end of the build, baring in mind, he was funding the build to wind/watertight stage only and the big fact in life that NO company can produce a full blown structural warranty on any property until its complete, no matter if it was an NHBC registered company for 50 years, all that can be produced during the build is a stage certificate. As EVERYONE KNOWS, the lender very clearly did not know his own business.

The first lender decided to stand his ground and refused to release any further funds until the borrower paid for a structural warranty by another provider, that provider he wanted the borrower to pay just happened to be the advisers company as they also offered structural warranty services. strange! Anyway, this would be a substantial cost and the borrower was in a position where if they accepted the demands of the first lender they would be short of funds to complete the build to wind/watertight therefore eventually default on the loan and if the borrower refused the demands of the lender there would be no further funding, catch 22 at its best!

Again to cut a longs story short, the borrower refused to accept the lenders terms and everything came to a halt.

The borrower then tried to contact the adviser to let him know there was issues with the first lender, there was a call back from the adviser company to tell the borrower that the adviser had left the company and he was dealing with this type of funding. The shock was that, the borrower was told there is no details on the file that there was a second lender being used in this case, he couldnt find anything! and he would need to submit a new application for funding to the second lender as a matter of urgency. the brown stuff was really hitting the fan.

As far as the borrower was aware, the first lender knew nothing about the second lender not being in place but knew this was the exit strategy.

At this time there was meetings with all concerned (solicitors, borrower, lender) to try and resolve the situation, neither side would budge and it was made clear that the lender would pursue repossession for repayment of the fist stage release to the borrower with the addition of further legal fees and interest.

While awaiting a reply from the new adviser who took over from the first guy who dealt with everything the borrower had a meeting with the solicitor, during this meeting a call between both solicitors took place and the lenders solicitor told the borrowers solicitor that the NEW application the borrower made to the second lender was rejected bare in mind, the borrower was still awaiting a decision, how on earth could the lenders solicitor know it was rejected? (more later about this)

The borrower done some digging on the first adviser and found that when he left he went immediatley to work for the first lender, it was also found that the adviser had worked for the first lender for a few years dealing as a property development manager it was now clear something was going on and the situation stank of a setup.

Eventually, the contract expired and it was to be a full month after the expiry date the borrower received a calling up notice, it was expected much earlier. (more to come as to why they couldnt call it up as soon as the contract term expired)

So at this point, the calling up notice showed that the lender was pursuing for the initial first stage funds released which was 1/3 of what he should have provided BUT he was also wanting the full interest and fees amount as though he had produced the full amount of funds under the contract, the total came to almost double what he initially released, not a bad return for a very short 4 month period eh?

At this point it was inevitable court proceedings were on the cards and both solicitors went back and forth as they do.

THE REALLY GOOD PART NOW.

The borrower decided to do a regisrty check on the property and to the borrowers shock and horror it was found that the first lender after only three weeks or so of producing the 1/3 first stage funds he had sold on the security to a third party overseas for not only the full sum of money he was supposed to lend the borrower but for the cost of the full amount and the interest and fees he applied to the loan (£76k). see below.

BTW it was the same solicitor the lender was using to deal with the initial contract (between him and the borrower) that facilitated the deal between the lender and the overseas third party, the solicitor states that she merely facilitated the deal between the lender and the third party as instructed. She knew the lender had only provided a 1/3 for the first stage funds under the contract between the lender and the borrower but yet she allowed the lender to sell the security for the full amount to a third party.

First stage release £20k - released
Second stage release £40k - not released
Interest and fees £16k - on full amount under contract

Total = £76k

Effectively, the lender was sitting on a nice healthy nest egg off the back of th borrowers property which the borrower knew NOTHING of and which was given as security to the lender and at the same time the lender while he refused to provide the second stage release under the contract until the borrower accepted the lenders terms to incorporate his new demands into a new contract he demanded the borrower signed or he would refuse to pay out the second stage release. the whole scenario was a farce!

Anyway, getting back to why the lender, it was clear he would not be able to call up the loan for what he did release as he did not hold security/charge over the property. What he had to do was buy the land back and then call up his loan, the buy back took lace some weeks AFTER the initial expiry date of the contract between the lender and the borrower.

It has also became clear that the First lender is also a good mate of the main man at the second lender company, it seems he may just have had a word in his ear to reject the new application which was made to the second lender by the NEW adviser on the borrowers behalf.( i wont mention anything on why this would be the case) and how it was possible for the first lendes solicitor to tell the borrowers solicitor while they had a meeting that the NEW application to the second lender was rejected while the borrower was still awaiting a decision!

The whole thing stinks but this is as far as i feel i can go at the moment, when this is resolved by Mr Judge i will give everyone on here the full story and name everyone involved in this mess.

As i am a very dear friend of the borrower, I have every intention to expose every single thing i know about this lender, the adviser or should i say his employee and the solicitor when this is all done and dusted.

It will be Epic I ASSURE YOU ALL

thanks for reading guys

[Ruby]

Re: Lenders are abusing exemption clauses to make loan agreements fit into unregulat

Thanks Ame. I am sure I am not the best qualified person for the job at hand but unfortunately I have personal experience.

My first piece of homework is to get in touch with the FCA and see if I can get anything out of them.

[suffering]

Re: Lenders are abusing exemption clauses to make loan agreements fit into unregulat

cul8rm8e this seems to be a another "set up to fail" by the lender

[alibongo]

Re: Lenders are abusing exemption clauses to make loan agreements fit into unregulat

Best way to beat them is s 58 and s 61 cca 1974. Stated cases ni master 3 and ni master 9. Must give you cooling off period. Most likely to not have.

[suffering]

Re: Lenders are abusing exemption clauses to make loan agreements fit into unregulat

cooling off period only applies to regulated loans, hence lenders making loans fit into unregulated.

[Ruby]

Re: Lenders are abusing exemption clauses to make loan agreements fit into unregulat

I got a response from the FCA. Basically a 'dear John letter'. In the letter it stated that the company is regulated by them and if I have issues to get in touch with the FOS. For anyone who follows my posts you all know what I think of the FOS!

[cul8rm8e]

Re: Lenders are abusing exemption clauses to make loan agreements fit into unregulat

just been onto the FCA. the FCA confirm that the lender stated on the court proceedings only hled a consumer licence as a Mortgage Broker under the category Credit Brokerage. Does this mean the supposed lender was not licenced to lend money therefore the whole contract is illegal.

comments please

[meellis]

Re: Lenders are abusing exemption clauses to make loan agreements fit into unregulat

There is correspondence around from OFT that trading without the appropriate license is illegal and most people understand that know one can be seen to be profiting from an illegal act. But somebody has pointed out that the powers that be will probably allow a chance of remedy of this illegal act because it seems these companies can break the law and then buy themselves out of trouble. I will not go into where these two polar arguments come from but I would suggest having good representation who is able to understand the facts and present it properly.

[Guest]

Re: Lenders are abusing exemption clauses to make loan agreements fit into unregulat

just been onto the FCA. the FCA confirm that the lender stated on the court proceedings only hled a consumer licence as a Mortgage Broker under the category Credit Brokerage. Does this mean the supposed lender was not licenced to lend money therefore the whole contract is illegal.

comments please

Only if he was trying to sell a regulated agreement,

[meellis]

Re: Lenders are abusing exemption clauses to make loan agreements fit into unregulat

If cul8rm8e is talking about where they have only received first part of a loan and that part was under the limit then that is what good representation could be needed for.

[cul8rm8e]

Re: Lenders are abusing exemption clauses to make loan agreements fit into unregulat

It seems all you have to do is stipulate that its unregulated and for business purposes and any W, A and R can do what they like. for a while anyway

I hear those muppets that use these tactics float about these forums.

[cul8rm8e]

Re: Lenders are abusing exemption clauses to make loan agreements fit into unregulat

If cul8rm8e is talking about where they have only received first part of a loan and that part was under the limit then that is what good representation could be needed for.

Onto it!

[Dougal16T]

Re: Lenders are abusing exemption clauses to make loan agreements fit into unregulat

IanM has summed up, very succinctly, how these sub-human lenders operate. IMHO, what they are doing amounts to Fraud by False Misrepresentation per se, not only against the borrower, but against whoever lends the money to the sub-human lenders, also.

As for the arrogant manner in which these sub-human lenders behave, that does not surprise me. They don't see what they are doing as a crime. The only crime, as far as they are concerned, is getting caught.

Hi Bluebottle,

Bang on the button! This is exactly what all Criminals think.....their only Commandment is simply 'Thou shalt not get caught'!!

But, get caught they will, sooner or later, it just takes time and effort to bring these offenders to Justice. My old patrol Sergeant used to say, "When you catch them, make sure they stay caught!!"

Maybe one day this will be the case...............

Best wishes to all,

Dougal

[meellis]

Re: Lenders are abusing exemption clauses to make loan agreements fit into unregulat

cul8rm8e what I had been wondering about your problem was whether your agreement should be classed as a multiple agreement because there seems to be two different agreements with two different lenders going on there all under the one agreement if I understand your posts correct. If the first agreement was under the threshold then it needs looking into as maybe a separate agreement. The paperwork signed said they claimed exemption under section 16 of the act and was it 189. You really need to clarify how and whether either of these apply, section 16 I believe covers mortgages which would be covered under FISA and the lender would have to be registered to be able to claim exemption. As to the other exemptions they would be claiming then you need to see if they apply, Whenever I have had business loans as a sole trader they have still been covered by CCA because they were under the threshold.