Did you know that the bank may just stop any sort of repossession hearings in the future if they’re happy with the plan?
If they’re not happy and they think the likelihood that you’re not going to be able to pay off the arrears or settle the debt, they may put you into a payment plan under something called a suspended possession order. That could mean that anytime that you make any missed payments, you have to go back to court and the bank have the automatic right to repossess the property. So there are quite a lot of variables, but on the whole, it’s a three to six month process but is the quickest for a residential homeowner.
The banks typically have to try and be helpful and have some forbearance to allow the homeowner as much time as they need to be able to sort out their finances. But sometimes the banks can be very aggressive, depending on the size and the nature of the debt. So they can actually go in with stealth and be very aggressive, especially when it comes to larger size properties where there’s a lot of money at stake – going back to commercial properties such as BTL’s, shops, offices, et cetera.
How quickly are LPA receivers appointed?
There’s very little time, actually, because you just get one letter because you’re in arrears, or you broken part of the contract. Then typically the quickest a receiver has been known to get appointed is about five to seven days, but on average, about 14 days to get appointed. Once appointed, the LPA receivers have the ability to change the locks on your commercial premises and start collecting the rental directly from the tenants. The LPA receivers also have the power of sale to put the property into auction or to sell it through estate agents. So that’s the general difference between the two.
I’ve been told that Immediate Bank Claims has a way around that or is able to stop any such action. Is that right?
Well, there are a lot of things that we do, but they’re all dependent upon us going in and doing the due diligence on what’s happened in the circumstances. So I wouldn’t like to say that overstate what we can do. But in certain cases, yes, we have been able to go in and change the locks back on properties where we have all the documentation information to validate our position. Is
Do they let people who’ve got commercial assets do payment plans or payment arrangements?
Okay. I just have been clear about the question. So there isn’t any sort of ability to have any repayment plans if it’s a commercial property where the Law of Property Act 1925 applies. Once you’ve gone to arrears or default or you’ve broken the terms of the contract, then there’s very little comeback, and there’s no real room for negotiation. Whereas invited homeowner, who owns a property?
Banks do agree to payment plans or payment holidays, sometimes in the beginning of the negotiations. But if the payment plan is broken like I said earlier, continuously, I’ve known for cases to go to court a couple of times, and the judge normally rules in favor of the bank as the payment plan has not been adhered to.
That means that if you break the payment plan in any way, then the bank has the right to basically repossess the property, but they will appoint bailiffs and then the property will be taken over. Unless you can pay back the whole debt on the property, the whole mortgage itself, which would mean either a sale or a complete payment of the arrears. And even then, the bank may not be happy with that.
Why are the banks being so aggressive about it? Isn’t it in the favor of the bank for you to keep the property?
It’s not necessarily in the favor of the bank because the bank is not getting their money paid back every month. So they rather have all their debt paid back than to be waiting for their monthly interest. So they’d rather take that money and use it elsewhere than to be in a position where they’ve got outstanding debt with the borrower.
