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Archive for August, 2016

Brexit to potentially delay Bank Loan Sales

In recent times, we have been approached by various individuals, businesses and professionals, all of whom have received letters from their primary lender essentially providing them with them with three options as follows:

(a) Pay now in full

(b) Re-finance and pay in full

(c) Failing the above, we will sell to a third party fund

Needless to say, this has caused grave concern for many, particularly as the time frames implemented, along with the options provided, are neither reasonable nor feasible. Recent discussions that we have been party to however have revealed that, as a direct result of Brexit and, indeed, the lingering sense of unknown and uncertainty as to how things will look/operate going forward, there has been complete failure in terms of attracting third party interest for loan purchase.

Previous loan sales have attracted the attention of monumental vulture funds such as Cerberus, Cabot, Loan Star etc. however it would appear that the appetite is non-existent this time round…for now anyway. This means that certain loan sales have been delayed for now which is neither what the Banks wanted, nor what they had planned for. Further communications with the relevant Bank’s have further demonstrated that the Banks are, once again, open to proposals of settlement where addressed forthwith. This welcomes a final opportunity and shot for those, previously threatened with loans sales, to engage with their subject Bank forthwith and to look to put matters to bed once and for all, seeking final settlement and resolution and thus avoiding further delay.

 

The experience to date with certain loan sales for many Borrowers has been a heightened sense of delay and thus frustration in dealing with matters. We would strongly encourage and, indeed, emphasis to anyone in this position, importance of seeking to deal with matters now rather than putting them on the long finger in which event, the same issues/debts could continue to surround and pressurise months, years even, down the line yet with continued, accruing interest and charges. Why wait – Engage now with a view to finding peace, freedom from the burden of pressuring debt and, indeed, a new beginning!

 

Call us now in order to discuss your options going forward and to start on the path to resolution

Bankruptcy- What can happen?

Bankruptcy, the “B” word, is feared by many and has negative connotations associated with it. Sadly, we see many Creditors petitions in Court for borrowers being made Bankrupt by their Lender. Perhaps the stigma surrounding Bankruptcy has been reduced since 2008 due to the increase in numbers filing for Bankruptcy but it is still something that many fear and want to avoid at all costs however It can prove to be a useful tool for borrowers whose debts are so significant that there is no route to negotiate with lenders.

Aggressive Creditor’s Petition? What’s the worst that can happen?

You can be made Bankrupt by your lender. It is a lengthy process for the Creditor and does involve cost but nonetheless many will pursue this route to non- responsive debtors. Throughout the process a Creditor must take action to declare the debtor Bankrupt, the debtor will be given every chance to respond. Amicably liaising with a lender can vastly reduce the chance of you being made Bankrupt and also bring about a positive outcome for all parties involved should this be the best option for you.

Should a Creditors Petition be followed through you could find yourself in increased financial difficulty. You may be called for a meeting in the Official Receivers to discuss your finances and they may decide to implement an Attachment of Earnings Order. If this is put in place funds could be taken directly from your monthly salary and distributed to the relevant Creditors. Furthermore, if made Bankrupt your assets could be in significant danger for example, if you have equity in home this asset is in severe risk. Other matters to consider include vehicles, pensions, life insurance policies etc.

Is there such thing as a ‘best case scenario’ in Bankruptcy?

Providing the Client’s circumstances align, Personal Bankruptcy can “clear the decks” allowing the individual the opportunity to start again. We regularly assist individuals going through Personal Bankruptcy and help to alleviate the pressures involved.

Dependant on your personal situation Bankruptcy may not have a serious effect on your day to day life for example, if your home is in negative equity there may be a a high possibility that you can retain this in Bankruptcy once mortgage payments are maintained. Furthermore, an income payment order may not be applicable if there is an undisputed deficit each month. There is also a possibility that you will retain your vehicle, life insurance and pension.

Regardless of best or worst case scenario, Bell & Company can assist in providing the appropriate advice tailored to the debtor’s personal circumstances with a view to establishing your best case scenario.

Contact the team here or call 02895 217 373 to discuss your circumstances and take the first steps towards your fresh start in life.

 

Will seeking to reach a settlement with my lender impact on my credit rating?

Far too many people underestimate the importance of their Credit Rating. It is a key tool in life and maintaining your credit score can bring about significant benefits to you in sourcing any form of credit from an Energy Account, Mobile Phone, Credit Card and all the way to Mortgages. A strong credit score will allow you to access higher levels of credit at much better rates.

Bell & Company will advise of the full ramifications of the process you take will have on your credit file. That is why our advisors typically ask for your credit file when we meet for our free initial consultation, it is key we hav all of the information so the team can paint the full picture for you.

Some advice we hear clients given regarding their credit rating is appalling. Many advise to simply stop payments – this can damage your credit rating massively and should you default will cause you 5-6 years of difficulty. Make sure you get the correct advice by calling Bell & company and attending a free initial consultation.

In answering the title, it depends! Through the negative equity resolution process your credit score can be maintained depending on your circumstances and the lender processes involved. Some lenders however will require missed payments and this can cause damage to your credit file. Once again, if you provide us with the full information from the outsets we can offer advices as to the impact on your credit score.

To discuss your case with us please call 02895 217373 to arrange your free initial consultation at a time and place to suit you. We look forward to assisting you.

Money raised for negotiations via litigation

Debt settlement – Homes and Farms protected

A Farming Client of ours approached us in relation to significant pressure they were facing regarding a debt of c£2.5m owing to one of the most aggressive, local based lenders existing
-The money that had been lent was somewhat on a bridging basis on the back of the imminent & expected sale of a separate property
-This sale would have re-paid the loans to the Bank in full & allowed our Client to profit greatly
-Due to the fall in the property market however, the proposed purchaser withdrew their offer entirely and it appeared that the contracts were not strong enough to compel completion
-Our Clients could not obtain finance at the level owing to the Bank due to a drop in milk price & were left entirely incapable of addressing the monies borrowed

-The Bank had security over 2 family farms, the value of which outweighed the liabilities, and the subject Bank had threatened Receivership
-Our Clients saw nowhere to go and were distraught that they and their family were to lose everything
-After an in-depth and diligent review of their case, aswell as all papers associated with our Clients’ situation both current and historical, we identified a potential negligence case regarding the previous, expected property sale
-We referred and worked consistently alongside a outstanding, local Legal Firm through intense litigation
-The result for our Client was favourable and we raised the necessary funds to satisfy the Bank and protect all that was important
-During the on-going litigation, we frequently communicated with and met with the relevant Banking institution to prevent enforcement action which had been threatened many times
At the point of conclusion, we also managed to negotiate with the Bank and achieve savings of c£500,000 for our Client

Can I sell if I’m in Negative Equity?

Bell & Company regularly hear individuals in Negative Equity declare themselves as “Mortgage Prisoners”. This opinion is often developed from listening to poor knowledge of their circumstances and not seeking professional independent advice.

The answer to the question is, YES but it depends.

Releasing a charge on a deed

Some lenders will allow borrowers who are in Negative Equity to sell their property. This must be done with prior consent from the lender. Otherwise, they will not release their charge on the deed so there would then not be clear title to complete the sale.

Open Market Sale

The lenders who do allow an open market sale will require a full financial review often in their own format. Bell & Company know which lenders allow borrowers to sell on the open market and we also know the processes. Our Resolution team achieve on market sales agreed with lenders daily.

Some lenders however will not allow an open market sale. This does not seem like a commercially minded decision given that an open market sale if beneficial for all parties. Achieving the true price for the property which will ensure the lender receives the maximum sales proceeds possible and the borrower’s shortfall debt is reduced.  Nonetheless, this is their stance and must be respected.

Even if you are with a lender who will not allow an open market sale it is still possible to offload the negative asset, but it comes with greater issues. This involves repossession (through court) or voluntary surrender of the property – this will typically mean a sale in possession by the lender which typically achieves only 70% of open market value. There could also be consequences for your credit rating.

Appointing Bell & Company

It is essential you do not deem yourself a “mortgage prisoner” and understand that options do exist and that many people in a similar situation have extricated themselves from Negative Equity by appointing Bell & Company.

Our expert team will ensure the advice is tailored to your situation. We do not tell you what you want to hear but instead what you need to know to move forward. All our initial consultations are free and to arrange yours please call us today on 0330 159 5820.

My Loan Has Been Sold to A Third Party – What does this mean for me?

At Bell & Company, we assist individuals whose original loans have been sold to a third party.

Vulture Funds

An initial reaction from Borrowers whose loans have been sold is that of trepidation.  This attitude is likely brought about by reading articles wherein these third parties being called “Vulture Funds”.  Some firms have outlined the likes of Cerberus and Lonestar as being vulture funds. There is without question the opportunity to resolve defaulted debt accounts and Personal Guarantees.

Many clients, that we are currently assisting in this field, have seen that a loan sale has given them the opportunity to address the issue. The case with many lenders, who sold loan books, is they were previously inundated with cases. These cases required resolving without having the personnel or resources to resolve the matter.

Conversely, a loan purchaser will be looking for a quicker turnaround and a return on their initial purchase which will be a significantly reduced price when compared to the outstanding loan balance, dependent of course on the Borrowers’ surrounding position.

Benefits for the Borrower

Considering this, the benefit for the Borrower is they are dealing with an entity that has the appetite to address the issue and are looking for a return which is significantly less than the overall liability. Essentially, a loan sale gives the borrower a chance to finalise a problematic loan default, Personal Guarantee or debt.

Your third party will be requesting proposals and Bell & Company have the experience on how to structure, present and negotiate any proposal tailored to your current circumstance. Our Corporate department work in this field daily and are changing both the lives of individuals as well as business prosperity. Many successful businesses have been subject to defaulted debt and once resolved the fabric of a successful business can remain.

If you or anyone you know has a personal or business loan, sold to a third party and want professional independent debt advice.

Please call the office today on 0330 159 5820.

Bell & Company always offer a free initial consultation and we look forward to meeting you to outline all the options available.

Could I lose my home?

Could I lose my home?

One thing we understand entirely is that home is sacrosanct to most people thus it is imperative that the situation at home is investigated first and foremost. In many instances, a Borrower/Guarantor’s home will be mortgaged with another lending institution and, as a result of the property crash, there will very rarely be equity in the home thus there is nothing there for lending institutions to pursue/Official Receiver to vest an interest in.

However, each case is different. A lot centers around mortgage balance, current market value and whether there is any equity within the property. A lending institution only can initiate repossession proceedings. if your home has been directly offered as security.

Personal Guarantee

If you have signed a Personal Guarantee, your personal assets are exposed. Any Creditor can seek to realise the equity in any assets relating to you by seeking Judgment and enforcing same thereafter or, alternatively, petitioning for Bankruptcy, even if they have no security.

If there is equity in your home, this will have to be considered in any settlement proposal to ensure that the same is protected. This will often avoid aggressive action than by a Creditor. However, rights are always reserved.

If you or anyone you know could benefit from our services, please call us today on 0330 159 5820.

 We look forward to working with you.

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