Lombard Leasing

This leasing arm of RBS has proved difficult for assessment with any consistency. Lack of consistency in pursuing personal guarantees can work in your favour. However, along with other leasing companies, many personal guarantees often don’t stand up to scrutiny, are integrated into finance agreements and aren’t clear enough as to the parties involved.

 

For more information, have a look at our website at www.personal-guarantee.co.uk

HBOS - how they operate when enforcing personal guarantees 2

As noted in the last blog with regard to HBOS, the lending policy of HBOS was very aggressive. It’s symptomatic of an institution that is going hell for leather for market shares by sacrificing some first principles of lending.

 

There has been particular comment in the press about the lending practices of the Reading business centre of HBOS, where it is alleged that customers were encouraged to take up facilities they did not need or indeed, under normal scrutiny, could not justifiably afford. This all adds grist to the mill when challenging the validity of a personal guarantee or the funding that it relates to.

 

For more information, have a look at our website at www.personal-guarantee.co.uk          

Communication with banks and debt collectors 3:

Avoid email communication at all costs; imagine you are a ‘tick the box’ jobs-worth at one of the banks central departments. Five emails in one day can be the equivalent of ticking three months worth of correspondence by snail mail.

 

It can be forwarded off their list and straight to their solicitor to deal with.

 

Emails are also notoriously unreliable; (not that normal post is much better) with today’s virus scanners and ability to be lost in a myriad of emails, there is no guarantee of delivery. Fax and guaranteed delivery posts are your safest form of communication.

 

For more information, have a look at our website at www.personal-guarantee.co.uk

Lloyds- how they operate when enforcing personal guarantees 2:

Lloyds do struggle with personal guarantees. For example, we have seen them use an "abbreviated" form of personal guarantee; you would have to wonder in what circumstances it would be appropriate to not use the full version.

 

Lloyds used to have the reputation of referring to solicitors more, however have not been as immediate more recently; but as more personal guarantees are being collected, the pressure is on, so there may be change.

 

For more information, have a look at our website at www.personal-guarantee.co.uk

Communication with banks and debt collectors 2:

Dealing with the pressure from banks and debt collectors can take its toll. Daily worries about the post arriving, the dread of opening it and the hours of worrying about it whether you have opened it or not have an enormous effect. One way of dealing with the stress is by not opening them as soon as they arrive. Put it in a box and allocate two hours a week of which you dedicate to opening the letters. Don’t change that time, (a bit like the time of a church service or a train you must catch) and don’t allocate weekend time for it. Most documents can wait 7 days before having to be dealt with. For more information, have a look at our website at www.personal-guarantee.co.uk

Barclays –how they operate calling in personal guarantees 2.

As noted previously, Barclay’s tends to go legal a bit quicker than perhaps necessary, so good communication with them is essential.

 

As bank solicitors are known to be working under some sort of ‘fixed fee contract’, it is highly advantageous for those on the receiving end to employ a solicitor who knows exactly what they are doing. This quick off the mark attitude to appointing solicitors is almost always to Barclay’s detriment, as bank lawyers tend to treat the process as a bit more as if it were a numbers game. Inexperienced, junior solicitors are often used to do much of the work; and hence, often get it wrong.

 

The key is ensuring that your solicitor knows exactly what they are doing, but unfortunately most solicitors are known not to do well in defending personal guarantee cases. In fairness to them, they don’t understand the nuances because they do not have the experience.

 

However, as with all banks, a deal is always on the table; the question is, is the personal guarantee enforceable anyway, and so is the deal is worth doing?

 

For more information, have a look at our website at www.personal-guarantee.co.uk

Leasing companies- how they chase personal guarantees.

Leasing companies do tend to have a more aggressive nature when it comes to chasing and may often refer to solicitors as they tend not to have the internal resources to dedicate. Yet, their personal guarantee documentation seems to be, for the most part, very badly constructed.

 

These are often combined with the finance agreements themselves, leaving such documentation as inexplicit and signed without an element of care; the signing of which is often enforced by agents on their behalf.

 

However, this doesn’t stop them and their solicitors from being aggressive because they are as well aware as we are that few solicitors know how to defend personal guarantee claims effectively; and that is where we come in.

 

For more information, have a look at our website at www.personal-guarantee.co.uk

HSBC- personal guarantees, how they enforce 2.

Generally, HSBC do struggle with the enforcement of personal guarantees. It could be said that many of their managers have approached the signing of personal guarantees in a dismissive manner, putting it down to a mere formality.

 

It has been noted that HSBC does not enforce (or rarely confirms) legal advice obtained. It is interesting to note that their presentations of standard documents are as deeds, which according to their own internally dictated systems have to be witnessed by a representative of the bank, which begs the question of the validity of the deed.

 

For more information, have a look at our website at www.personal-guarantee.co.uk

HBOS- how they operate when enforcing personal guarantees.

Their centre for dealing with most personal guarantee issues is in Edinburgh. It is well known that HBOS has gotten itself into a predicament by entering the England and Wales market aggressively. Consequently, a great deal of corporate lending was provided accordingly, without the performance of the necessary or appropriate checks and balances.

 

Having said that, their systems are known to be generally better devised through ensuring personal guarantee documentation and keeping the originals; however, they are by no means perfect.

 

For more information, have a look at our website at www.personal-guarantee.co.uk

Communicating with banks re Personal Guarantees 1:

Ensure to communicate with banks through letters and faxes. In doing this, delivery is traceable and it reduces room for confusion.

Avoid phone calls and email communications at all cost. To assist in persuading the bank not to attempt to contact you through any methods other than by letter, ensure not to include email addresses and phone numbers in letterheads and only include a fax number if you want their letters to be faxed to you. Should you choose, accepting correspondence by fax does have the benefit of ensuring delivery to you and helps prevent any lapses in communication.

If the bank does contact you by phone or email, make it clear to them that you would appreciate it if they only communicated to you in writing so as to avoid any misunderstandings. If necessary, outline to them that you are not willing to accept communications by email as it is not a secure and reliable format of communication.

For more information, have a look at our website at www.personal-guarantee.co.uk

RBS/Natwest- how they operate 1.

Commonly, but not always, easier personal guarantees to contest than other banks due to the rarity of positively ensuring their customers to get legal advice. They also tend to scan and/or microfiche documents rather than keeping originals.

 

They, like most banks argue vehemently that they are not required to keep originals so this matter has to be handled sensitively if you are not going to end up with having the expense and trauma of dealing with solicitors acting on their behalf.

 

They have a customer service centre based in Telford that deals with personal guarantee and overdue debt issues, which is often haphazard in their communications.

 

For more information, have a look at our website at www.personal-guarantee.co.uk

Lloyds- how they operate 1.

Their centre for dealing with most personal guarantee issues is in Bristol. Local bank managers normally send the first letter or set of communications and often try and get a deal done- however, they have limited power to negotiate.

 

Lloyds do the right things, by offering fixed repayment figures over periods of time as part of their demand or follow up letter.

 

They also tend to perform better than other banks in preparing PG documentation, but don’t use that as a reason to cave in- they are by no means perfect!

 

For more information, have a look at our website at www.personal-guarantee.co.uk

Barclays- how they operate 1.

Their central base for dealing with pg issues is in Cardiff, sometimes a bit quick off the mark going legal, particularly if they think there are some assets to grab. Tend to be better at ensuring clients get solicitors advice at the outset but again, inconsistent in this as well as other areas.

There may be some initial communications form the local branch but for the most part it is Cardiff that do the bulk of the chasing.

Tend to get a bit feisty when asked for original documents, strongly denying the need for them to be produced.

For more information, have a look at our website at www.personal-guarantee.co.uk

HSBC- how they operate.

In the last 15 months or so, we have seen a department allegedly based in Canary Wharf but actually based in India manage collections regarding PGs- the long Indian names and .in email addresses tend to give them away. However, they are difficult to contact and relatively slow to respond, which is great under normal circumstances if you are fighting a war of attrition but dreadfully frustrating if you actually want to do a deal. We have seen a recent move by HSBC to use their internal Birmingham based resource, Metropolitan Debt Collection Services and DG Solicitors, but again find they can be just as ineffective in pursuing on behalf of the bank. For more information, have a look at our website at www.personal-guarantee.co.uk

Mainstream bank centres for dealing with Personal Guarantees

In each of these blogs, I will try and provide some insights into how the institutions such as banks approach their calling in of personal guarantees.

Most of the mainstream banks have centres that deal with the chasing of personal guarantees- so although the local manager might send the initial demand letter and try to negotiate a repayment plan, they have little authority to do a deal and will often suggest taking an interest bearing loan.

An agreement at this stage would be a result for the bank, but certainly not for the person who signed the personal guarantee!

However, the longer the matter is being dealt with at this level, the more time the personal guarantee holder buys themselves, so don't be in too much of a hurry to move it on to the banks' centre! And remember, many personal guarantees are at best dubiously enforceable and many are not enforceable at all.

Personal Guarantees

After a leave of absence from the blogging world, I am now rejuvenating my blog to cover all things to do with helping people who have personal guarantee claims against them. For some good background and support on the matter, go to my website www.personal-guarantee.co.uk . Twice weekly, I will provide an update through this blog on the latest that is going on in the personal guarantee world, with some particular insights in to the way particular banks are behaving and how that is changing.

YOU SIGNED A PERSONAL GUARANTEE, NOW THEY ARE CALLING IT

Your in trouble, right? The bank are writing some very strong letters so you have to pay, don't you? You're going to lose your house, aren't you?

Not necessarily- certainly no one should welch on a commitment they have made, but was your commitment legally made and if not, do you therefore really legally owe the money?

Not always. With personal guarantees, the banks can be notoriously bad at keeping their end of the bargain by not having their paperwork in order or being sloppy or otherwise inept at putting the personal guarantee in the first place.

And you can guarantee that if the boot was on the other foot, they'd make sure you know it and certainly they will leave you with the distinct impression that you do owe the money come what may.

So there is plenty of scope to contest the validity of a personal guarantee if it gets called and even if the bank do have everything in order, they generally want to do a deal anyway so all is not lost.

It isn't necessarily in their interest (and costs money for them) to bludgeon you into submission if you can't pay them any money anyway.

But hiding and hoping it will go away is just as bad as rolling over and letting them run over you- the consequences can be dire if you do not communicate with them. There is a balance to all this and communications that on the one hand races along or on the other are non-responsive on your side can lead the matter into difficulties, because if it goes too fast and the bank do not like what you are saying, the next step for them has to be court action.

It is the same if you do not respond to them- what else can they do?

Some solicitors are not much help either. They can charge a fortune and often not have the relevant understanding or skill to deal with the matter in your best interest.

So make sure you get good advice. Go to a solicitor or a professional who can demonstrate true success in this area and ask them for a reference from someone they have done it for. If they cannot demonstrate that, then they are not the right people to use- you will just spend good money after bad and still probably be on the wrong end of it all.

GOOD MONEY AFTER BAD?

Are you even getting a salary from your business? Is the answer No, I wish.

Alright then, here's another for you- are you in fact propping your business up by doing any of the following?:-

* borrowing against your house
* depleting your personal savings
* using your spouses income or income from elsewhere
* loading up personal credit cards
* taking out personal loans.

As a one off considered decision as part of a plan of action, then fine,

but is it happening monthly? weekly?

Then you need to ask this question- When will it stop?

If this is what you are doing, it is probably because your business is losing money, and three things will inevitably happen.

1. You will turn around the business so it starts paying you.
2. The business will fail, taking down all the money you put into it and possibly you.
3. You run out of personal funds, taking both you and your business down.

But it doesn't have to be that way.

You can break the cycle, and there is more help than you can ever imagine to help you solve the problem.

Go talk to someone (me if you like)- there is plenty of support around (some good, some bad, but you got to start somewhere)- find people who have been through what you have been through and come out the other side- you'll be surprised how many people will tell you their story.

But don't go and drain more of your depleted personal resources unless you know how you are going to get it back- it is the road to ruin.

Is it really so bad? Why me?

How about is it out there? Well, pretty bad actually. Banks are reducing facilities and increasing margins at the expense to their clients. Businesses are falling like flies. Orders are getting cancelled.

Bad isn't it?
All the banks fault, isn't it?
Why us?

Well,
yes,
probably, and
why us?

For many of us, we do have essentially profitable businesses.

But do all of us?
Have we made any real money?
Or even during the good times, when markets were good, were we just getting by?
Were we (and are we still) always moaning about how bad it is?
How many of us talk ourselves into a hopeless state?

My experience, and this is experience forged out of 2 recessions, is that if you have essentially a good business (do you?), you can and will get through this, providing you do enough of the right things.

What are enough of the right things?

There are many, but let's take 5 to stir your emotions.

1. Is your and your business cloth cut accordingly? Really?
2. Do your clients know you are still here? Are you sure?
3. When your competitors go down, where are their clients going? To you?
4. How do you value and make the most of the one real commodity you have- time?
5. Are you confusing motion with action?

Answer those questions, honestly, really honestly, and you might be on the way to getting through this and, just as many businesses I work with, actually buck the trend and make some good money.

An Introduction...

Hi there,

Welcome to my blog on turnarounds in business- given the current climate, quite a relevant topic.

My experience was forged in my mid-20s when at a relatively young age, I became a Finance Director of a group of companies that were turning over £5m and losing £2.5m- quite a feat really. Lucky for the business, it had a property portfolio which provided cash and funding to by the time required to restructure the business. To be quite honest, I was out of my depth but being single at the time (and younger!), I was able to work 7 days a week, often 20 hours a day to do enough of the right things to get the business back on track.

Within 2 years we were able to turn the whole thing around into a £500k profit, the owner has gone onto become a multi-millionaire and I learnt what it took to turn a business around.

That experience has held me in good stead for some 22 years, and was invaluable in the early 90s as I worked with businesses that actually grew during a recession.

The first thing I would say is that I am not an asset stripping son of a gun- I work with the managing director owners of the business so that as far as practically possible, they retain control and ownership of the business.

The second thing is that the current climate is extremely volatile- you only need to read the daily swathe of business failures and scale downs to know there is a serious issue out there but they are survivable if you have a sound business model.

Lastly, although the current economic climate is at least as severe as it was in the early 90s and maybe more so, I get a real kick out of not only helping businesses to survive such times, but to actually grow- and it is not as hard as we sometimes make it- it is purely a question of doing enough of the right things consistently and persistently while others are floundering around.

So with that in mind, I'll be putting out a weekly blog which will provide three things-

1. review of some experiences during the week which may be valuable

2. tips, actions and ideas that can be used to survive these times in business

3. information on what is available to help


If you would like some more information or contact me, please look at http://www.tgba.co.uk/ or contact me at mel@melloades.co.uk to find out more.