First things, if you are being chased just before 6yr point (normally the case at 5yrs 11mth’s) don’t respond, only respond if you get a county court claim. If you get chased at the 12yr point i.e. 11yrs 10mths (normally the case) don't respond again until get the county court claim. They will chase you at the first point only because of the limitation period of 6yrs to chase for the interest element which in some case can be quite substantial or just enough to cover the legal fees if it goes slightly sour at the judgement time. If they chase you at the 11yr point they are on dodgy ground as far as the court is concerned especially if there has been a history of communication or that they were aware of your whereabouts, but note they would have to do this as the 12yr limitation period would apply.

So do you make contact or not, there advantages and disadvantages.

The advantages – if it goes legal your in a strong position in one respect as you would be seen to be abiding by the pre-action protocols (these are the general protocols not like the ones for personal injury etc). If gives you an advantage of time to obtain information, yes but, you may say, they don’t supply anything. It is a lot simpler than it looks. How to get information firstly follow the information on this repossession website in respect of SARN. Treat this differently than your normal information requests. The SARN can be quite selective and a lot of information would be hidden or just removed/snowed out. Your request for further ‘information that supports their claim’ would be for more specific information i.e. a copy of or proof that the MIG had been paid, copies of the sale literature etc. So make sure all requests are sent recorded delivery just to make sure they have received them, you can even chase up the recorded date and time on the royal mail website. Now, how to deal with the negative response. On your 2nd / 3rd request you state this ‘ Should you not respond to my request for this information I shall have no choice but to apply to the county court for this information under CPR 31.16 and that further I shall seek cost of such an application’. (Make sure your write every 7days for the information if you going to use the CPR 31.16 route.) You can make this formal request on form N244. Make sure that you specifically state what information you want and how long and times you had requested such information and that you request that the court ‘Orders’ that the information requested be provided. The cost is about £30 without a hearing £60 with a hearing. Should you get stuck on this, say so on this site I shall seek you out and advise accordingly or you could ask for a solicitor to do it. You can apply for this ‘pre-trial disclosure’ before legal action has commenced only the threat of legal action would be enough. This will most certainly upset the apple cart and get things moving in the information sense. If the court does order and they refuse to send the information you can ask for the case to be struck out for not complying with a court order in relation to their claim (subject to a claim being made), which means if they had just made the claim 1 month before the 6yr point the 2nd claim would have its interest element time bared 6yr+.

So in short getting information is possible.

The disadvantages are that you have confirmed who you are; they will intensify their demands for money and refuse to provide information. Just put the letters aside and politely request that they provide all the information you have requested before you respond more directly to their alleged claim.

By this time they would have already carried out searches on your abode, at the land registry office, checked you post code details for affluence, had you checked by a local private investigation team and so on. The first thing they want to know is, are you worth taking to court over. If you have no assets, not employed or on low income and that your circumstances are not going to change, they are hardly going to take you to court for over £5k especially if you contest it as they are only going to waste £3.5k minimum in legal fees which would take years to recover if at all.

The most important piece of information they would want would be your telephone number followed by your NINO (National Insurance Number) they would pass this on to a dodgy bloke and have it checked for income details either via DWP (DHSS) or the Inland Revenue at a cost of about £20 would know more about your income details than yourself.

If you are renting, in other words don't have your own home or equity in another property or your partners, you’re in a strong position. If you do own your home or have equity in another and the lenders know this then sadly you’re on a looser they will pursue you via the courts as they will know you have access to funds in the short term or long term (your looking at a charging order here). Though if you have children they would be unable to force a sale on your home until the children were of age.

If you have no home or equity they just want you to pay money, even if its just £10 so that the limitation period starts again or they have a CCJ they will just wait until your circumstances change then jump on you again. However in this situation you are more likely to get a good Full and Final offer accepted unlike the unfortunate who have their own home or equity in another.

If you want to know anything else JUST ASK

Don't try to email me too many dodgy blokes monitor this site, if you need help use title 'Just Ask' and will try to be of assistance.

-- justask (justask@btinternet.com), February 15, 2004

Answers

Thanks for that info and for your offer to help.

-- Lee (repossession@home-repo.org), February 16, 2004.

Hi

A couple of points on an excellent posting from JUST ASK. I agree with almost all of what was said but wonder whether it is wise to let a claim go to court if it is not absolutely necessary and there is not a realistic defence to the claim or a substantial part of it, especially where the borrower is, as was said, vulnerable due to being a home owner again.

Over the years I have seen too many people fight inappropriate cases in court and end up losing, with heavy costs penalties and six years worth of interest on top.

On the issue of interest, have you come across Halifax v Adamson? I haven't got the case to hand but from memory it concerned a claim (or counter claim) for underselling. The borrower was successful but was not awarded all the interest she was entitled to due to having delaying her (underselling) claim.

However, interest is not usually an issue in the shortfall cases I see as lenders usually appropriate all payments to interest. This is the general rule anyway, and is often included in the terms and conditions. Also, since West Brom BS v Crammer, a lender is entitled to appropriate payments up until the time for skeleton arguments.

So, in practice, most shortfall claims are made up of principal (+ statutory interest if they go to court).

Also, I am concerned about how lenders will react now to SARNs. Any recent experiences would be helpful.

I have come across numerous cases where lenders will not exchange info and documents in breach of the Overriding Objective of CPR 1 and the Pre-action Protocol Practice Direction, but this usually only results in a costs penalty, if that.

All the best

Guy

-- Guy Skipwith (guy@skipwith107.freeserve.co.uk), February 16, 2004.

Response to Guy from Justask,

Many thanks for reading my points.

Of course it is not in anyone’s interest to go to court, as there is always the problem of incurring legal fees on top of the claim. However it is really up to the lender to choose whether or not they wish to go to court which falls mainly on the feasibility of maximising their return from the short fall balanced with their ability to substantiate the shortfall claim. Of course there is no reason why some strong minded folk may wish to got to court themselves in an attempt to challenge the lenders, sadly in some cases a futile attempt of moral standings. Thus again much depend on the ex-borrowers financial situation or the lenders position, such as:

a. If he/she is property owner or has access to equity in another property. In this case if one does not offer a high percentage of the shortfall the lender will most certainly go to court to get judgement with the sole intention of then applying for a charging order.

b. If the offer from the borrower is close to what the court may consider as appropriate then the lender would more than likely take up the offer. (just make sure it is a full and final, with the normal conditions applied).

c. If he/she doe not own their property or have no equity interest in another the lender would be less inclined to go to court in view of wasting more money, however if the only option in maintaining that interest, they would no doubt at the 10/11yr point go to court even if it is just to keep the shortfall claim open thereafter. A CCJ can be chassed for up to 6yrs and then would have to back to the courts and justify it.

d. The ability of the lender to justify its claim is also very important thus just as important to chase the lender for every bit of information that may reduce the claim or even fingers crossed be strong enough for a claim to be struck out should it go to court. The lenders appear to rely on the ignorance of us common folk (big mistake, when you corner someone it’s a case of ‘cry hell and let loose the dogs of fury'.

OVER THE YEARS I HAVE SEEN TOO MANY PEOPLE FIGHT INAPPROPRIATE CASES IN COURT AND END UP LOOSING, WITH HEAVY COSTS PENALTIES AND SIX YEARS WORTH OF INTEREST ON TOP.

Hence the reason why you tend to get the court summons at the 5yr 10/11mth period just to get the interest element added on. What you have to remember is that if you do pay the initial shortfall claim they will not tell you about the interest element until after, then come chasing you for it. Or it may be the case that the lender is only chasing you for their element of the claim and the MIG claim would follow in due course if not at the same time.

Under selling is one of the main defences, however it still has to be proved to some degree, how, well one would most certainly need to approach the Land Registry and get the average house selling price of that post code during the period that the property was sold. Additionally one would need the lender to show that they had made every effort of obtaining the best price for the property and sufficiently advertised the property by providing copies of the sales literature and advertisements. Any shortfall here would put a serious argument to underselling the property.

The lenders will be pursuing the mortgage element (principle), charges, interest for that year and interest on the amount owed (which is the statutory interest). The lender would appropriate any monies received against interest first followed by any charges and cost (this is usually indicated in the deed if not as Guy had pointed out would be seen to be by the courts from previous precedents). They do this so that the shortfall claim can be pursued for a longer period, remember they have 12yrs for the mortgage element.

ALSO, I AM CONCERNED ABOUT HOW LENDERS WILL REAT NOW TO SARNs. ANY RECENT EXPERIENCE WOULD BE HELPFUL.

Hence the point of making an application for ‘pre-trial disclosure’ gets that information that might not be so forthcoming. Consider this, it’s not the information that they provide which of concern but the in formation that is not there, so one should always consider what is missing and more importantly why is it missing.

I HAVE COME ACROSS NUMEROUS CASES WHERE LENDERS WILL NOT EXCHANGE INFO AND DOCUMENTS IN BREACH OF THE OVERIDING OBJECTIVE OF CPR 1 AND THE PRE-ACTION PROTOCOL PRACTICE DIRECTION, BUT THIS USUALLY ONLY RESULTS IN COSTS PENALTY, IF THAT.

The cost penalty can it’s self be quite damaging i.e. pursuing a claim for £6k the legal fees would be around £3.5k, if the lender is only awarded £3k and loose the cost element then they are out of pocket by £500, sadly though the borrow still owes £3k!

-- justask (justask@btinternet.com), February 16, 2004.

I agree with Guy's comment above - an excellent posting by JUST ASK. I would only add a couple of things to what's been said already. I believe it unlikely that just obtaining 'the average house selling price of that post code during the period that the property was sold' from Land Registry would be sufficient in an underselling case, I think you would also need to get more concrete evidence for example at least one backdated valuation on the repo'd property concerned. Secondly, it is also unlikely you would get copies of the sales literature and advertisements through sarning, not only because of what Guy has said but also because I have been told by a Data Protection Act compliance officer that marketing material is unlikely to be personal data and so need not be provided by a data controller, of course it's still worth trying though. Finally, as Guy has mentioned before, if an MJO was issued the lender can chase you indefinitely, in theory.

Mark.

-- M Amos (idgroms@hotmail.com), February 17, 2004.