Response to 12 Year Rule again - start or finish???

The CML guidelines say they will make first contact within 6 years (NOT 12!)and that if they don't, they will not pursue the debt. Note that this is only a guideline, and not legally binding on them, but they're unlikely to break it openly. So if they have never contacted you until after 6 years, your first point should probably be that even if you were to admit liability for the alleged debt, they've burnt their boats. The problem with this is they may come up with a copy of a letter supposedly sent to you years earlier, but which you never received because they incompetently sent it to the wrong address, or the postman ate it, or something. Even if you never received it, they will claim it counts as a first contact. The 12 year rule is different - it is from the Limitations Act, so is a proper law, not a guideline. This says that the lender can chase a mortgage debt for 12 years from the date on which you first defaulted on a mortgage payment. Often this is months or years earlier than repossession. So they have 12 years from this date to collect the shortfall. Any portion of the debt that arises from the interest part of the mortgage can only be chased for 6 years from the date of first default. hth

[ Previous | Next ]