If the bank is lending you money, don’t they have the right to be that aggressive? 

Technically, you could sort of say, yes, they’ve got the rights, because if you’ve signed up to something, then there’s an old sort of thing as a buyer beware, which applies to basic contract law. But in this case, because what’s unfair, I’d say, is that a lot of borrowers of money from the banks are not aware of all the implications. To disagree that they are somewhat, they are completely unaware of what the bank’s powers are, what they can do.

If the bank realize that you are over geared or even have a slight chance of actually falling into arrears, they may not even actually taken on the debt in the first place. So that’s probably the fundamental point here. To summarize this topic. There is a difference and is in there when you’re living in your property as to the way the bank has to behave with you. And when you’re in a commercial asset, it’s slightly different.

There is a fundamental difference In regards to the contract, despite a lot of similarity, the most notable difference is the reference to the Law of Property Act 1925 which will only be found in commercial finance contracts such as bridging, BTL property contracts. It’s isn’t used for any residential loans, so that’s quite black and white. Okay.

So I think there’s a certain duty of care by solicitors to make people aware what can happen and how it works with the receivers, but even some sort of fact sheets given to them made them aware how that would work. But the way things are explained for the moment is very generic.

Are you aware that your property will be repossessed if you do not keep up with your payments?

A lot of people don’t realize that they may actually be misguided in their thinking as well because they may know about home repossessions; they sometimes assume they’ve got three to six months. They may not realize that the Law of Property Act 1925 means that the property can be literally taken away from them within five to ten days of them going to arrears. That’s something that they wouldn’t be aware of.

So I think the statement by the solicitors is probably correct in terms of informing you that you’re going to get house repossessed. But that’s the same statement if you’re a homeowner. I think education is important. Hence, these interviews are quite critical. Part of us spreading the message out to people is to make them aware that dealing with commercial properties is not all as it seems.

Well, I think people still want to buy houses on the whole, because if they understand their own personal circumstances and they’ve got enough money to back themselves up, I would say that people would be a lot more cautious about the type of debt they would take on. And if there’s a remote chance of them getting into arrears and they did their calculations or did better calculations what they were doing, then they may go for a cheaper property. They may not buy a property they may decide to rent, so they would be a lot more cautious in terms of getting themselves caught up in a can of worms.

But they don’t really fully understand. So taking all those matters into context, let’s round off this morning going back to the singing of the week, and that is what hurts you. Blesses you. Does it hurt you when you are being repossessed or taken over by LPA receivers?

Well, yeah, it does, because it’s hard earned money that’s going to be going to be losing because the receiver takes the property over. You are known longer control over the equity you’ve got in your property, and if they’re going to spend it just for the debt amount a little above