Response to MIG Cover?

Stephanie,

I think the solicitor's advice was correct at the time in that the lender could have gone for a charging order over your new property. However, he should have put the lender to strict proof over the alleged shortfall, did he do that? If he didn't, my feeling is (bear in mind I'm no expert) that resiling may possibly be a good idea, as having made payments to the lender you have effectively acknowledged the alleged shortfall. Resiling may cancel this out and therefore statute bar the shortfall. However, a solicitor has told me the following:

"In respect of resiling an acknowledgment, I don't know of any limitation cases where this has been an issue, but am aware of Bird v Birds Eye and Gale v Super Drug (I have a copy of Gale but not Bird). The latter case seemed to say that an admission can be withdrawn unless the other side can show it would be prejudicial - however, the cases seem to relate to withdrawing admissions made as part of the pleadings - I don't know if they would apply to an acknowledgment made prior to and independent of proceedings."

Did the lender obtain a money judgment order? If they did then they can pursue indefinitely and resiling may be of no use. You really need professional legal advice on all this. I think you are quite right to push the point regarding the mortgage deed, it'll be interesting to see if they have, in fact, added you to the deed. Whether you are joint and severally liable given that the offer was only made to your husband and you were possibly added to the mortgage deed at a later date, I don't know, I'll try and find out.

In respect to the MIG. You state that "the cover would apply to your husband", the cover only applies to the lender. If you are in fact joint and severally liable then the insurer can pursue both of you under the rights of subrogation. If it were me I would claim mis- representation and put the lender to strict proof that they did indeed purchase a MIG. The MIG question has been covered a fair bit in previous postings fairly recently.

I think you need to decide (at least your husband) whether to defend a possible claim or negotiate a one lump settlement after having put the lender to strict proof. If you decide the latter, don't forget to include any third party i.e. insurance company.

Hope this is of some help.

Mark.

P.S. I would also get your local MP involved.

[ Previous | Next ]