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Thomas
Thomas, Lawyer
Category: UK Law
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Experience:  BA (Hons), PgDip, Practising Solicitor
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A family friend paid of my outstanding balance of my mortgage

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A family friend paid of my outstanding balance of my mortgage by way of a loan on the agreement that on the sale of the house or my death he would be repaid plus interest. Unfortunately circumstances have changed, can he force me to sell my house or repay this money that I am unable to obtain?

Hi,


Is there a written form of loan agreement between you?

 

Did you execute a declaration of trust declaring his interest in the property?


Tom

Customer: replied 5 years ago.

Hi,

It was just a letter from me to him confirming the loan and that we agreed on the sale of the house or my death it would be repaid with interest. It was not a legal binding doc from a solicitor.

Were the terms of the loan as communicated limited to "on sale/your death" alone?

 

Were their absolutely no other agreed terms about you being able to pay off if you came in to some money OR him requiring early repayment?


It all sounds very imprecise, which is quite unusual where significant sums of money are involved.


Tom

Customer: replied 5 years ago.
No it clearly states when I dispose of the property or on my death

Sure. But there were definately no other terms which were discussed orally between the two of you but not expressed in writing?


Tom

Customer: replied 5 years ago.
Not that I can remember, it was back in 2006,

Why this man did not take legal advice Ill never know. He would have been advised to eitther take a charge over your property or at least enter in to a declaration of trust confriming his interest.

 

On the terms as you have communicated them to me I cannot see that he would be sucessful in applying for an order f sale for the property because you have not breached the agreement, nor sold the property or died.

 

That is not to say that he ,might not claim that there was an orally agreed term which affording him the right to request payment of the debt or to force the sale of the property in certain circumstance.

 

If he does claim this and it proceeds to litigation then it whether the order is granted would depend on to whose testimony the judge attaches the greater weigft of credibility. The fact that it is not expressed in the document you hold will count heavily against him- if the term which he purpots was agreed why was it not expressed in the agreement because it is a very important element.

 

He has not protected himself very well at all. His decision not to take legal advice is to his severe detriment.


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Kind regards,


Tom

 

 

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