I'm sure the credit union may make a bit of a fuss and it would depend on what paperwork was signed, but based on your question, I would have to say yes IMHO.Therefore Slim - would you think the person who handed over the deeds, without signing anything, when they ask the CU for their deeds back, that they should be given them without any preamble?
The holding of deeds by credit unions is more to prevent someone taking out a mortgage without their knowledge. It is an old fashioned concept that carries no legal weight as far as I know. In most cases, the credit union would execute what is called equitable deposit to secure the deeds but that has been phased out. The only legal mechanism now is a charge on the property taken out by the credit union. Deed holding per se does not empower the credit union to force sale or anything else. Deeds are an old fashioned concept as all property folios are copies, AFAIK, no doubt someone with legal knowledge/experience will comment.
Based on your original post and not being privy to the actual case, I would say there is very little chance the credi union could force sale of the property. Howevere, the relation that lodged the deeds may have gone guarantor on the loan and may be pursued equally or the loan as the borrower. In relation to settlement of the debt, this would entirely depend on the particular CU and their policy on that. A settlement for cash may well be favourably received.Thanks for all the replies and also for the digging MF1.
It's a land registry title prior to 2010. It's not the new Land Registry. Deeds were sent by solicitor to credit union.
The real problem is not actually them forcing a sale but the value will not cover the loan by a wide margin and borrower will still be liable. Borrower and deeds owner have no other assets and are on social welfare.
Would the property owner be entitled to legal aid to defend themselves against the credit union. Ideal situation would be to get the credit union to accept the property as full and final settlement.
Would a cash offer work, what percentage would one have to offer?
. A settlement for cash may well be favourably received.
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