My boat has been repossessed and I've also been handed the mortgage to pay

[duncan1859]

I bought an unregistered panther sportscruiser in 2006 for £17500. did an HPI check and a search of the small ships regster. All clear.

In 2009, the bank of scotland contacted me to say they have a marine mortgage on the boat. I challenged this with my searches o they took the matter to the high court and won. I did my own defence as I felt the boat wasn't worth the price of QC's.

I presumed that if they won they would be entitled to the boat, but that is not all. The judge has ruled that the entire mortgage and interest is now my liability. The previous owner who did not mention the mrtgage, now owes £27500 and this debt has been passed to me. So I have lost the boat and the cheat who ripped me off is sitting pretty 10 miles away while I now have to pay his debt. The bank have started bankruptcy proceedings.

Has this kind of thing happened to anyone else?

 

[Elessar]

I bought an unregistered panther sportscruiser in 2006 for £17500. did an HPI check and a search of the small ships regster. All clear.

In 2009, the bank of scotland contacted me to say they have a marine mortgage on the boat. I challenged this with my searches o they took the matter to the high court and won. I did my own defence as I felt the boat wasn't worth the price of QC's.

I presumed that if they won they would be entitled to the boat, but that is not all. The judge has ruled that the entire mortgage and interest is now my liability. The previous owner who did not mention the mrtgage, now owes £27500 and this debt has been passed to me. So I have lost the boat and the cheat who ripped me off is sitting pretty 10 miles away while I now have to pay his debt. The bank have started bankruptcy proceedings.

Has this kind of thing happened to anyone else?

Makes you ashamed of British justice. How is one suppsed to respect the law when it makes judgements like this?

The banks need to have a central number to call. Have you a mortgage on XXXX? If they say no when you buy, they should have no further claim.

 

[gardenshed]

1. you need professional legal support (I'm not a lawyer)
2. get the banking ombudsman involved
3. initiate proceedings against the previous owner as while title was on the boat, he is the mortgage holder, not you
4. check the usual citizens advice/FSA sources to find ways to at least delay proceedings

 

[Seahope]

I presumed that if they won they would be entitled to the boat, but that is not all. The judge has ruled that the entire mortgage and interest is now my liability.

I am also not a lawyer and agree you do need professional advice. If you are technically bankrupt then you may now be entitled to Legal Aid.

On what grounds could the Judge have decided that you were liable for the original owners mortgage default?

A rather worrying tale since I'm sure a lot of us with 2nd hand boats have this worry at the back of their minds even after having performed the checks you made prior to purchase

 

[sarabande]

did your bill of sale say "clear from all encumbrances" ?

If so I reckon you have an action for fraud against the previous owner.

 

[magic-martinh]

How awful for you. As above, did you use a bill of sale that was signed by the previous owner stating it was his to sell and free of debt?? if so then you sue the seller, if not, I don't know where you stand.

 

[Tidnock]

almost incredible.
It would appear that you purchased the boat in good faith and paid a fair market price, taken the necessary steps to ensure it was free of finance and owned the boat for three years, I would go back with legal representation.

I might be wrong, but "the legal system" does not like self representation

Assuming you are private individual, I cannot see why you have incurred the mortgage debt, that is the part I cannot understand.

Where is the boat?

 

[volvopaul]

Id say jfm off this forum may have the answers to this, but reading it if it were the same for a car then id still say the mortgage is down to the previous owner as it was his, lets face it you didnt take the mortgage with them, ask for there small print terms though as I said you didnt have any agreement with them for the boat,.

The old saying bought in good faith wont count at all.

Id have thought that all you would have lost is the boat as you just paid cash for it and the previous debt stays with the boat as per any lien on any vessel ie service work, improvements etc that have not been paid prior to a sale.

As BOS have now left the marine mortgage scene it jus shows you how poor there system was, they should have made the owner register the boat to protect themselves against any future sale so they have a hold on it.

Imagine the boat had gone abroad they wouldnt stand a chance of seeing there money again, and quite rightly thats there fault had the previous owner took it abroad and sold it, thats tough on there part.

As you are obviously very straight and gone to court to protect yourself and do the job right, its all backfired on you, id just declare yourself bankrupt if you can and get out of the so called debt thats been quite wrongly passed on to you.

Im at aloss as to why BOS are not persuing the previous owner who has cheated them by not paying his loan back, he is the one who have broken the law in my opinion, he should be made to settle and pay all your costs, so why do they take the easy option.

This is clearly a prime example of how poor the marine lending system is, its all very easy to lend money to people who cannot possibly pay it back, have a big smile on the day with the commision from the smiling dealer.

I do feell for, please keep us updated on this case im sure it will be very interesting.

Apologies to anyone who points out im wrong in any of my post, but thats the way i see it, I personally would never borrow against a boat to raise funds, too much paperwork at the point of sale if you needed to sell on quickly in my opinion, especially if the brokers not up to scratch.

 

[oldgit]

Welcome to the Forum,loads of advice here and very helpful info from some memebers with legal experience.

Have always thought that when you buy a boat you buy it complete with all debts.

This can include monies borrowed against the boat and any mooring fees and other expences run up by the previous owner.Has been the case since time began .
Surely the SSR does not record mortgages ?

Get legal representation now and go after the ****e that sold you the boat

One step at a time.Be patient. Do not give up.Do it carefully and properly,make sure you cover every escape route and get back every last farthing from him.
Many of us have had to go down the legal road and things do seem to be unfair sometimes,but if you think you are in the right ,you simply cannot let the so and so get off scot free.Worth doing a check right now with the land registery to find out if he owns his house or is it in his parents name,takes 10 mins and will cost about £5.00,you need a credit card.wonder if they guaranteed the loan ?
https://www.landregistry.gov.uk/wps/portal/Property_Search

Give him a few sleepless night for starters....
A half hour with a solictor will cost you about £100.00 it will reassure you as to the strength of your case and this first step is always the hardest one,explain the circumstances and you may not have to pay up front.
Personal advice,do not go down the Small claims route unless the solicitor suggests it.
bloody good luck.
Did the bloke buy another boat by any chance ?

 

[Solitaire]

In 2009, the bank of scotland contacted me to say they have a marine mortgage on the boat. I challenged this with my searches o they took the matter to the high court and won. I did my own defence as I felt the boat wasn't worth the price of QC's.

Are you a member of the RYA? If so, they have a legal department and it would be worth contacting them.

 

[PaulGooch]

This is nonsense, IMO.

The standard procedure when taking out a marine mortgage is for the lender to insist on part one registration, against which the mortgage interest would be registered.

BOS had the means to protect their investment, by using the ship registration and you would have then had the means to check that the owner had title, at least in terms of a mortgage.

The fact that BOS did not insist on registration is negligent on their part and a good solicitor would surely argue this point.

I'm not a solicitor though, you MUST go see a solicitor NOW.

 

[Woodlouse]

As said, get a solicitor. Appeal against the bank and then go after the guy who sold you the boat.

 

[Imperial One]

Duncan,

I have sent you a PM.

Much good advice here - this is a ridiculous situation - give me a call and I'll try to help you.
Number in my Pm or on my website.

Mike.

 

[toad_oftoadhall]

Bad luck Duncan, I hope this gets resolved.

Can you find your case amongst these (scroll down a bit to find the right court):
http://www.bailii.org/databases.html

 

[SteveE]

I am not a lawyer, but a friend of mine brought a car the still had finance on it (HPI showed it being clean) and he showed the proof of the check and the reply, but he still lost the car to Black Horse Finance, but he could sue HPI for neglect (risky and costly)

If the finance on the boat is not yours I cannot see how you can liable, the other thing is if there is still 27k outstanding they now have the boat that has a resale value and the debt would be the delta of the two.

I think you will be OK on this but follow all the others advice and get legal advice ASAP...

Steve

 

[Marsupial]

SSR not Part 1

I've done some checking and I think I am correct in saying that if the Boat is SSR then the ruling is wrong. You MUST get a legal person to appeal and present your case.

WHY? well, if your boat is registered SSR then the RBS are NOT able to register an interest in the vessel, which means that they can only have a debt against the previous owner for what ever the loan was.

So they cannot repo the boat or hold you the new owner liable for the debts of the boat because the boat has no debts.

IF the boat was Part 1 registered - you know the outcome. the boat is a person in law and you are its guardian and as such must look after its debts.

you need a marine lawyer

Good luck

edit

this is a resonable source for info

http://marine-mortgages.org.uk/yacht-registration.htm#yachtregistration

 

[timbartlett]

Has this kind of thing happened to anyone else?

Yes, it has happened to quite a few people. Unfair as it may seem, the bank has done nothing wrong, and is entirely within its rights.

There was a time when marine mortgages would only be available on boats that were Part 1 registered, which at least gave some protection against this kind of thing, but that was not a legal requirement, and was abandoned in the feeding frenzy of the "boom" years.

I'm not a lawyer, but if you know where the seller lives, then you have almost certainly got a claim against him for failing to disclose the mortgage. Whether you will actually be able to get any money out of him is a different matter.

And it is possible that you may have a claim against HPI, who you paid to provide a service which they do not appear to have carried out as thoroughly as you might have expected.

Bottom line... You need a lawyer.

 

[Searush]

If former owner had unpaid debt on the boat, it is likely that there will be other debts. This can make sueing him pointless - you simply join the queue of other creditors waiting for a share of beggar all.

Of course, I'm no expert, but I understood that a genuine Marine Mortgage could only be secured on a fully registered "British Ship" where it is recorded against the vessel. SSR can't be used to secure a mortgage can it? I wouldn't normally expect an ordinary loan to be secured against a boat.

 

[RIN]

Marine mortgage interests are normally registered under Part 1 of the Registry of Ships and Seamen and not the Small Ships Register. But only if the mortgage company has insisted on it

I don't believe there is any foolproof way of being sure whether a mortgage exists on a boat.

You have had bad luck. Hope you can get the interest sorted.

Is it a well known bank? Maybe standing outside with a placard and tipping off the press will help?

 

[aquapower]

How can they take the boat and expect money, if you pay the mortgage at what ever is owed do you then not become the owner of the boat as it will then be paid for ?

How do you make sure this doesnt happen to you when buying a boat ?