What is the statute of limitations on a mortgage?

[mark71]

I last made a payment on a buy to let mortgage in August 2013 . The bank sold the house in September 2016.
Does the statute of limitations start from my last payment or does the clock reset from when they sold the property?
Also,I always assumed the time limit was 6 years ? But now not sure if it's 12?

 

[cremeegg]

Firstly I am not a solicitor.

I do not believe that the statute of limitations applies to a mortgage in that it is a secured debt and there is a charge registered against the property.

However when the bank sold the house was the charge removed ? Did the debt become unsecured ?

The period in the statute of limitations is 6 years (a judgement mortgage expires after 12, but that does not seem relevant here).

You are wondering if the debt has gone away on a technicality. Technicalities can be technical !

However I would let sleeping dogs lie, and even ignore barking dogs, at least to the point where you receive a summons.

 

[Brendan Burgess]

I did a piece on it a few years ago, but I have not updated it and I see that there are plenty of discussions afterwards.

Key Post - Does my debt just disappear after 6 years, if the bank does nothing or can't fit find

I have summarised the discussion from this thread. A creditor has up to 6 years from the date of the accrual of a debt to take legal action. If the creditor gets a judgment, it lasts for 12 years. (Well, after 12 years, you can apply to the court to have it removed) If you sell your house and...

www.askaboutmoney.com

 

[mark71]

I did a piece on it a few years ago, but I have not updated it and I see that there are plenty of discussions afterwards.

Key Post - Does my debt just disappear after 6 years, if the bank does nothing or can't fit find

I have summarised the discussion from this thread. A creditor has up to 6 years from the date of the accrual of a debt to take legal action. If the creditor gets a judgment, it lasts for 12 years. (Well, after 12 years, you can apply to the court to have it removed) If you sell your house and...

www.askaboutmoney.com

Yes I read through this . But when I googled to get an answer what comes up is ,
Mortgage debts
For debts relating to the principal sum in a mortgage, a 12-year time limit applies from the date when the right to receive the money accrued (section 36, SOL 1957). With regard to interest, a six-year time limit applies from the date on which the interest became due (section 37, SOL 1957).
Is the first part of this a judgement mortgage? This what confused me ?

 

[mark71]

Firstly I am not a solicitor.

I do not believe that the statute of limitations applies to a mortgage in that it is a secured debt and there is a charge registered against the property.

However when the bank sold the house was the charge removed ? Did the debt become unsecured ?

The period in the statute of limitations is 6 years (a judgement mortgage expires after 12, but that does not seem relevant here).

You are wondering if the debt has gone away on a technicality. Technicalities can be technical !

However I would let sleeping dogs lie, and even ignore barking dogs, at least to the point where you receive a summons.

Hi, once they sold the property I've had no contact or attempted contact from them whatsoever.
Also every year I do a credit check the outstanding amount is there but they've added no interest whatsoever which I thought strange ?

 

[RedOnion]

As Brendan's other post says, once they sold the property, it became unsecured, so 6 years would apply from that date.

Some lenders will have a reminder set for a few months before the 6 years is up to do a review and see if it's worth chasing you for the debt. All they have to do is lodge court papers to stop the clock.

Note, statute of limitations isn't a magic bullet. It's just a defense for you if they issue court proceedings after that date. The debt will remain on CCR after the statute expires, so it'll be on your credit record indefinitely - this wasn't the way under ICB, so banks are getting settlements now for lots of old debts that people had just thought would disappear.

 

[mark71]

Thanks for your reply Redonion. It looks like a long time of wait and see and stress so. Something I thought might have been coming to an end next year.