Who to go to?

goonso

Have probably a pretty unique situation that I'd love some advice on,

So a few years ago I built a house with my then wife(we are now separated) on land that was given to me as a gift from a family member.My ex wife is still living there with our children,very amicable break up so no problems with communication.

Now here is the odd bit,I took out a mortgage to build the house,but the land was never actually signed over to me as the deeds of the land were being held as collateral against a loan that had been taken out by my family member.

My solicitor was able to secure the mortgage for me from the bank saying that I would provide the deeds of the land,to the bank,as soon as I received them from my family member.

Then,the solicitor I was using (whom I have to say up to this point was always very good and thorough) basically skipped the country leaving a mess of paperwork not only for me but other clients of theirs that I knew.

So now I am separated and paying for a mortgage for a house built on land that does not belong to either me or the Bank(as far as I know as neither of us have the deeds of the land),I have approached a new solicitor about this who informed me that they could not give me proper advise on what to do with this,saying that I may need to go to a Barrister.
Does this appear to be my only option?Can the costs of this become very high?
My ex wife is in two minds whether as to stay in the house or not as it is not near her family/friends and is too large a house/site for her to maintain by herself.

So if anyone has any advise on where to start with this I would really appreciate it

Bepolite

Sounds like you'll need specialist legal advice alright. Costs will be higher than a solicitor alone but if you listen to most of the barristers on here they'll do it for a bag of chips and a fiver.

That's one interesting mess alright. I'd say you'll have some fun issues with estoppel relating to various promises in regard to the land and various other equitable issues.

There are some pretty smart cookies here and I'd love to see what gets made of this one from a purely academic stand-point. It's a real shame you didn't read the charter and present this as a hypothetical. I hope the mods leave this one open!

nuac

Such things happen. Real can of worms.

Talk to an experienced solicitor. Most offices have been thru' such nightmares

Peregrinus

This is a bigger problem for the bank than for you! If you stop repaying the loans, what are they going to do? They haven't got an enforceable security; they have an undertakign from your former solicitor, but there's clearly no point in suing him.

Another bank holds a mortgage over the property to secure a loan granted to your family member. Has that loan been paid off and the mortgage discharged? If so, your relative can complete the transfer of the land to you, and you can complete the grant of the mortgage to the bank. If the house is later sold, the loan gets repaid out of the sale proceeds.

As matters stand, the house is probably unsaleable - certainly by you and your wife, since you don't own it. Plus, it's still mortgaged to the first bank.

There is not a great deal that you can do as long as your relative's loan, and the mortgage that he granted to his bank, remain outstanding. Keep repaying your own loan; it's effectively an unsecured loan as far as your bank is concerned and, should you stop paying, they have no recourse but to sue you, which I suspect they would do fairly quickly.

I don't think you can do much to clarify and simplify the situation until your relative's loan is cleared, and the land transferred to you. How do matters stand there?

goonso

Thanks for the reply's

Another bank holds a mortgage over the property to secure a loan granted to your family member. Has that loan been paid off and the mortgage discharged? If so, your relative can complete the transfer of the land to you, and you can complete the grant of the mortgage to the bank. If the house is later sold, the loan gets repaid out of the sale proceeds.

The loan has now been paid off and the deeds are back in the possession of my relative
Is it looking like my only option is to have the land transferred to my name?Was wondering what come-back the bank would have if I stopped the repayments!

Bepolite

goonso wrote: »

The loan has now been paid off and the deeds are back in the possession of my relative
Is it looking like my only option is to have the land transferred to my name?Was wondering what come-back the bank would have if I stopped the repayments!

It would probably involve a long drawn out court battle with lots a fun cross examination of all parties involved. Eventually it might go either way but if it goes against you the costs are definitely going to come to more than a bag of chips and a fiver.

Peregrinus

goonso wrote: »

Is it looking like my only option is to have the land transferred to my name?Was wondering what come-back the bank would have if I stopped the repayments!

You are the bank's customer. You borrowed the money. You owe it to the bank. There doesn't seem to be any issue about this.

If you don't repay as per the loan agreement the bank can sue you for the full amount of the debt (plus the full amount of any other borrowings you may have from them) plus interest, plus costs.

Because they probably don't hold any enforceable security over the house/land, should you default on the loan suing you is the only option open to them, and they will likely move very quickly to do so - much more quickly than if they had a mortgage.

So keep paying the loan.

And yes, I think it's probably in your interests to get a mortgage in place as soon as you can (or to arrange the sale of the house and repayment of the loan).

Victor

Do you still get on with the family member? Have they paid off their loan? Would their bank be willing to take security on the balance of the site only.

These are things to discuss with your solicitor, not your family member / their bank.