Undervalue sale of property repossession

by Readers Question

13:31 PM, 21st November 2017
About A year ago

Undervalue sale of property repossession

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Undervalue sale of property repossession

I had a property sold by my lender for what I believe was undervalued.

It comprised of a house converted with consent into 4 x 2 bed flats producing £5200 per month on ASTs.

The lender kept the property for 1.5 yrs systematically vacating each flat thus reducing income. I believe each flat should have been sold separately, but instead after such a long period exchanged contracts who subsequently sold the contract at auction 2 weeks later and made £160k profit!

Does anyone know if any other cases of this kind have been reported or any comments greatly appreciated.

Nrinder



Comments

Neil Patterson

13:46 PM, 21st November 2017
About A year ago

Hi Nrinder,

Can I ask if you have been through the Bank's formal complaints procedure and taken it subsequently to the Financial Ombudsman?

Do you by any chance have proof of what the property was worth at the time of repossession?

Puzzler

15:15 PM, 21st November 2017
About A year ago

Repossessions are usually sold under value. They just want their loan paid off, it's almost as if they want to punish you further as well. They have no duty to maximise your share but should you still owe money they will still come for it. It's not fair but they hold all the cards.

Nrinder Gosal

0:05 AM, 22nd November 2017
About A year ago

Reply to the comment left by Neil Patterson at 21/11/2017 - 13:46
Yes Neil I have formally asked them and as yet no reply. That was my first port of call. I have valuations and properties sold listings of neighboring properties at the time.

Ian Narbeth

12:22 PM, 22nd November 2017
About A year ago

Hi Nrinder
The mortgagee has a duty to take reasonable steps to obtain the best price reasonably obtainable. This includes advertising it properly.
Are you saying that the person who bought from the mortgagee sold it within two weeks of completion of the purchase? If so he must have submitted it for sale by auction between exchange and completion. The question should be asked why the mortgagee did not sell by auction.

You need to take legal advice and I am afraid it will cost to bring a claim unless you can find a lawyer to take on a no win no fee case. You are still at risk of paying the mortgagee's costs if you lose.

JohnCaversham

15:03 PM, 22nd November 2017
About A year ago

Hi Nrinder-Sorry to hear about your problem, i'd be concerned too. My question would be did the mort co sell the unit via a local agent under a single title at its single title market value, then did the next owner split all the titles to individual units thus adding value before offering the whole lot at auction?
Rgds John

Nrinder Gosal

15:18 PM, 22nd November 2017
About A year ago

It was sold on a single title. The party who sold at auction did not own the property only a contract. Why would he pay for the property in full and create titles and sell when he could make a fast buck with only a deposit. I don’t even know what completion date the lender had set. I only found out about the auction by chance. The lender was obviously in no hurry to sell they were sitting on it for one and a half years and accurring extortionate interest!!

Ian Narbeth

15:37 PM, 22nd November 2017
About A year ago

Reply to the comment left by Nrinder Gosal at 22/11/2017 - 15:18One more thing. Can you find out (a search at the Land Registry might reveal) if the mortgagees transferred direct to end buyer or if they transferred to their buyer who transferred to the end buyer on the same day? There is a relief for SDLT if that happens and so it is possible the mortgagees did not know what was going on.
As I say, you need to get legal advice and I appreciate money may be tight for you. I would be astonished if the mortgagees offered you anything absent a credible threat of legal action and they are likely to resist the claim in any event.

Leonardo prince kaka

15:50 PM, 22nd November 2017
About A year ago

we have a fantastic tax barrister who can assist on this, on a no win no fee case , just court application from your side
call Leonardo or Anthony
on 07947508194 after 630 pm when its a tad quieter for us

Nrinder Gosal

15:51 PM, 22nd November 2017
About A year ago

Reply to the comment left by Ian Narbeth at 22/11/2017 - 15:37
I checked with land resistry and the title shows only the end purchaser with the amount paid. In any event I have the auction catalogue and there is no mention of my lender or their solicitor. One more thing this is one of 4 properties they repossessed. I had no mortgage just a loan which expired and they weren’t interested in reducing the loan. LTV was only 30% at the time .

Ian Narbeth

17:15 PM, 22nd November 2017
About A year ago

Reply to the comment left by Nrinder Gosal at 22/11/2017 - 15:51
Hi Nrinder
On the face of it you have a case. I have colleagues who can help if you want to call me on 020 7822 1616.

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