Coventry chasing for shortfall what do I do next?greenspun.com : LUSENET : Repossession : One Thread
Help! I have done OK so far but am not really sure where to go from here! In February 1996 we handed the keys back to the Coventry Building Society after two years of trying to persuade them to let us sell the property with the negative equity and move to a smaller property taking the negative equity with us. We have been in rented accommodation since then although we have moved three times but always within the same local area. On 10th July 2000 I received a letter out of the blue saying that I owed the Coventry #48,682.45 being the shortfall on the Mortgage. We were totally stunned as we had heard nothing in the meantime and thought the debt had been paid off by the MIG.
They sold the property for #87,995.00. I have written back to them asking why is has taken them so long to write to us as we have always been on the electoral role and had a redirection on all of our properties. I have asked why they are only writing to me when my husband and I held a joint mortgage. I stated that I feel the property was undersold for a "quick sale". I asked why the MIG we took out at their insistence at the start of the Mortgage had not covered the shortfall as we had been told it would do. I HAVE NOT FILLED IN ANY INCOME AND EXPENDITURE FORMS - AFTER READING YOUR SITE I AM SO GLAD!!! They have written back stating that: They are willing to accept a lesser amount in full and final settlement or monthly repayments!
The MIG did pay out #24,830.28 but that it does not cover us and that they still have to chase us for the full amount.
They have no obligation to contact us straight away - as long as it is within the six year period.
They only wrote to me as I was the only one who appeared on the electoral register which is untrue as my husband and I have both voted from this address. (Incidentally they have still only written to me despite the fact that the last letter was sent by myself and my husband and I confirmed that he was living here.)
They enclose copies of the two valuers reports which value the house at #85,000 and #80,000 so they say that they received a good market value at #87,995.
I have spoken to a local estate agent who has written me a letter to send to them enclosing details of properties similar to ours which were sold at that time for between #90,000 and #104,000. I have not forwarded this on to them yet.
I asked for copies of authorisation from Eagle Star to chase us for the #24,830.28 paid out on the MIG policy but they have refused saying that the details of the arrangement are confidential between the two parties.
They say nothing about the misinformation given to us about this policy when it was taken out.
They say that there is no record of us handing in the keys. They say the property was abandoned. Unfortunately we have no receipt for handing the keys in.
They say that none of the points we have raised have any legal foundation and they now want us to come to some arrangement.
What do I do now? My husband and I just want to put this whole thing behind us and get on with our lives but obviously we do not have this sort of money hanging around. We also feel very strongly that if the Coventry had listened to us back in 1994 we could have sold the property for a much higher price, taken the negative equity with us and repaid the amount owing to them whilst our overheads were much lower. We are in rented accommodation and have no assets. We are both currently working - my husband for his own company so he is not in effect self-employed. Is it worth fighting this or should we come to an arrangement? If we do settle for a smaller amount how much should we offer? Should we offer it or wait until they ask for an amount?
I would be very grateful for any help or suggestions on what to do next?
-- Alena Ayers (firstname.lastname@example.org), October 03, 2000
Frustrating isn't it!
I'm in more or less the same position at present and although I haven't got any legal advice for you I would say to really study this web set - it's a mine of valid information.
Regarding the MIG - I was also refused a copy of this so have just written back quoting the latest Civil Procedure Rights under which they have an obligation to show you all documentation relating to the case, (see answer to question DLA how to proceed). Have you also served them with Subject Access Rights? (see under Data Protection)- I've yet to see what they will show for me but at least it shows that you know what you're talking about to a certain extent and they cant just bully you into paying up!
Good Luck anyway!
-- Joanna Berry (email@example.com), October 03, 2000.
To add to the above answer, the Civil Procedures Rules (thanks to Lord Justice Woolf) dictate a new approach to litigation. They try to ensure more of a level playing field, by, for example, encouraging parties to 'put their cards on the table' well before court if even mooted. This means, wher necessary, an exchange of documents should take place. (Lenders such as Abbey are well known for their refusal to provide documentary proof of their alleged claims against ex borrowers.) The idea if to avoid delay and expense. Any party who delays can expect to have decisions over costs (very important to lenders) go against them. Crucially, 'A claimant bank will need to demonstrate that it has clearly explained its claim and has sought to establish and explore any potential defences with a view to avoiding litigation'. So if you claim a mis-sold MIG in your defence, they ought to explore this with you properly - which would presumably involve an exchange of documents - otherwise risk incurring so many costs in court that it isn't worth their while taking you to court (see elsewhere on this site). So why do lenders behave like this? Because (a) if they can bully you into coughing up they don't have to produce any paperwork and they make an easy profit; and (b) Stephen Byers, the Treasury and the Financial Services Authority consciously choose to let them get away with it. So you just keep fighting, and insist on proper proof that your ex lender acted correctly, and is acting correctly. Eleanor.
-- Eleanor Scott (firstname.lastname@example.org), October 03, 2000.
Well it sounds like yet another case of a lender misrepresenting the MIG when selling a mortgage. Currently some lenders are dropping the MIG because mortgage applicants are now becoming more informed by the likes of this and other websites and as a result question why they should pay the premium for the lender to benefit from it.
I would suggest that they probably did undervalue, under-market and under-sell the property. Why do I think they probably did? Simply because lenders have always assumed they can do so and because I have experienced it with the HALIFAX.
I have accused the them of 25 negligent actions during the Possession, Valuation and Marketing of my property which I believe caused it's sale at considerably less than true open market value. After an internal investigation they've now admitted to(In their own words): "Mistakes","Typograhical errors and confusion","Procedural Mistakes","Administrative Errors" and "Incorrect actions". They made a reduction offer, for what I still allege is negligence, that was insulting! It remains to be seen whether their explanations bear up in court under the weight of documentary evidence and expert opinion.
A test case with the addition of the the new Civil Procedure Rules and the new Human Rights Act might well deter this unjust practice in the future.
As Eleanor states under the new Civil Procedure Rules they are obliged to supply documentation.
You must also refer to Skipton -v- Stott, in that they must personally have ensured (Not just taken assurances) that the property was marketed by the Estate Agents in the same manner that they marketed any other properties.
I would also advise that when you serve the Subject Access Rights Notice enclose the full #10 maximum at that time. If it turns out that the fee is less (Unlikely - Why charge less when they can get #10!) then it is encumbent on them to return the change. This stops the lender being able to impose a delay - the 40 days will start from the day they receive the full fee. Also send the #10 as a postal order NOT a cheque! Otherwise it's like saying here's the bank I'm with and here's my account number!
As Joanna has said, read everything on this site including all these questions and answers, you'll be amazed at the information you can find.
Best Wishes - Tony Hayter.
-- Tony Hayter (Tony@Hayter.com), October 03, 2000.
Everybody's done such a good job of supplying answers (thanks folks - you know how much I appreciate it) that I am singling out only parts of Coventry's response to comment on.
>They have no obligation to contact us straight away - as long as it is within the six year period.
We say: This is in dispute. Some counsellors says lenders back off shortly before court over this (because the economics of legal action make it not worth the cost of risking a judge siding with the customer). Try Carol Riley of NAMV for more information.
>I have spoken to a local estate agent who has written me a letter to send to them enclosing details of properties similar to ours which were sold at that time for between #90,000 and #104,000.
We say: good for you - more people should make this effort, though it's not easy. Judges will ignore differences within 10% of the sale price though.
>I asked for copies of authorisation from Eagle Star to chase us for the #24,830.28 paid out on the MIG policy but they have refused saying that the details of the arrangement are confidential between the two parties.
We say: Uh-uh. Not good enough. This amounts to Coventry saying: "You owe us #24,000+ under a legal agreement that we have with someone else that you are not allowed to see". I don't think so. I would now narrow my responses to Coventry down to this one point. I would *politely* say that "I want to help you but unfortunately I do need to see that agreement in order to do so". They'll refuse and you just repeat your request. The aim: to get as much self-incriminating claptrap from them in writing as possible. Thank you for making sure you put Coventry's name in the subject line of your posting. The more people who read this and see how they operate, the fewer mortgages they will sell.
>They say that there is no record of us handing in the keys. They say the property was abandoned. We say: What does this claim make any difference to? Nothing, so far as I can see. Why are they arguing it? Have they put a cost in for getting new keys cut for the front door or something? Unless you were chucked out by bailiffs and a court order it was a voluntary repossession. There isn't any other kind of repossession.
>They say that none of the points we have raised have any legal foundation and they now want us to come to some arrangement. We say: They would.
I suspect from reading the rest of your post that you have not fully read the site, or that you are not convinced by the arguments it puts forward, or that you just want the stress to go. If the latter, nothing is going to take away the stress Coventry will put on you - unless you give in you are going to have to learn to live with stress. Here's how it works: they stress you, you cave in, Coventry wins on the cheap.
Please, please read the Do's and Don'ts section. Good luck
-- Lee (email@example.com), October 03, 2000.