Hounded by Halifax who didn't process Transfer of Equity

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My husband got divorced in 1993 and signed the house over to his ex-wife. Halifax say they never recieved it although it was handed to a member of staff. In Oct 96 his ex gave the house up for voluntary repo and made a deal with them. She paid them 2000 not to chase her. In Nov 02 we started getting threatening letters from Counselling Intermediary Services Ltd on their behalf wanting 8000 or else! What are our rights and do we have to stand for this? We wrote back immediately to explain the situation but they just keep demanding an Income and Expenditure form and offer of payment. Please help.

-- Jacqueline Bury (jacbury@ntlworld.com), February 23, 2003



The first thing which comes to my mind is that for your husband to have signed the house over to his ex would have required the services of a solicitor, would it not?

I think the first thing I would do is to see whether the CML voluntary 6 year code applies in your case, although this seems unlikely given the dates you mention. These are extracts taken from the Council of Mortgage Lenders web site: "www.cml.org.uk/servlet/dycon/zt-cml/cml/live/en/cml/pub_info_dept", Read everything on the web page though, as there are exclusions.

In addition, from 11 February 2000, lenders who are members of the Council of Mortgage Lenders have agreed voluntarily that they will begin all recovery action for the shortfall within the first six years following the SALE of a property in possession. Anyone whose property was taken into possession and sold more than six years ago, and who has not been contacted by their lender about recovering any outstanding debt will not now be asked to pay the shortfall. The Association of British Insurers supports this approach on behalf of the mortgage indemnity insurers.

All lenders which subscribe to the Code have now agreed to adhere to it whether they are a CML member or not. You can check whether a lender subscribes to the Mortgage Code by phoning The Mortgage Code Compliance Board on 01785 218200.

Unfortunately, if your husband cannot prove the property was signed over to his ex then the lender can chase him for the remainder of the shortfall. Furthermore, a payment by his ex could have restarted the limitation period (12 years). If a money judgment order was issued they can pursue indefinitely (unlikely in voluntary repo cases, I understand)The following comes from a solicitor:

An acknowledgment by a joint debtor only affects the person making it and not any other joint debtors.

A part payment affects and binds all others liable incl guarantors

Jacqueline, I would advise you/your husband to read the Home Repo site thoroughly, particularly the 'Do's and Dont's', plus previous postings. Put the lender to strict proof of the alleged shortfall debt. Did they sell your property for a fair price? SARN the lender/debt collectors etc etc. Don't panic, if all else fails he could try to negotiate a full and final settlement like his ex.

I would also contact your local MP and explain the situation to him/her, if he/she isn't helpful try another, for example one of the MPs on Mike Hancock's Early Day Motion 62 list shown on the "Repossession" page. Be careful not to acknowledge the debt in any communication with them. Always state that you do not admit liability to the alleged debt and that you dispute it. Failure to do so can restart the limitation period. I am not a professional adviser so please check this out with one. You can obtain free advice from the CAB and the NAMV. If you have any more queries just post them up.

Good Luck,Mark.

-- M Amos (idgroms@hotmail.com), February 25, 2003.

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