Barclays unable to show personal guarantee

[dearyme]

Saw a similar thread on here a few years back, but this is slightly different.

I took a £4k business overdraft out in 2015 with Barclays and agreed to a personal guarantee.

In 2017/18 I extended this to £12k

In 2020 I extended this to £49k.

By 2020 (and I am pretty sure in 2017) I had completely forgotten I gave a personal guarantee for the initial £4k. Due to a few things but mainly IR35 and Covid my business tanked and I maxed out my overdraft, making payments (£8k+) on the interest from a salary from a job. I then lost this job (still unemployed) and had no way to pay the interest. Barclays then kindly reminded me of the PG and insist it applies to the £49k (plus interest accruing at over £1k per month).

I requested multiple times that they show that they told me my extensions were subject to the PG and that I agreed to it. They've been unable to send me anything but the original agreement and PG from 2015.

My most recent request was in the form of a complaint and on the 8 week limit (during which they're still charging interest!) they sent me a copy of a letter they sent me in 2019 and 2023 within which they say 'by the way' any previous PG you gave still applies to your current OD limit. In the case of the 2023 letter I had already maxed out my OD!

I fully intend to repay my OD but Barclays' suggested solution of a resolve loan which would freeze the amount and give me 10 years to repay requires me to sign a PD for the full amount. The monthly interest is a heck of a stick to get me to agree I can tell you.

My contention with Barclays is why would I sign a PG for £49k if they're only able to show (after multiple requests and 4 months+) I agreed to a £4k PG.

What are my options here (if any)? Thanks in advance.

 

[ChrisCallaghan]

I'm assuming your company is Ltd? Have you taken any steps to close it?

My instinct would be (if you have not done so already) consider liquidating the company, especially if you have no current need of it due to the IR35 changes, which would potentially end their claim against the company. You could always set up a new company later should you come across any inside IR35 work in the future. Myself or any of the insolvency regulars here on UKBF can advise you in much greater detail on this side of things.

However, prior to that I would recommend taking advice from a personal guarantee expert. I'm not aware of any such professionals here on UKBF, however my preferred expert on this for nearly a decade has been Mel Loades and his team at https://personalguarantee.co.uk/. I can also recommend https://aftassist.com/personal-guarantees/. If you contact either I'd be grateful if you advise them who made the recommendation.

Happy to offer further advice on the liquidation side of things if you'd like to direct message me.

All the above are my initial thoughts on first reading, and I'm happy to hear other UKBF members' suggestions.

 

[dearyme]

Thank you Chris. I'll certainly look into those recommendations!

I'm thinking of trying again with my own biz in the new year (tech recruitment hence the IR35 issues and why I'm unemployed right now - it's a decimated sector), so I was thinking of keeping the Ltd company around.

 

[pentel]

The wording of the original guarantee would usually include a clause to extend the guarantee to any subsequent OD increases.

Might be wort reviewing ALL of the wording of the agreement.

 

[ChrisCallaghan]

The wording of the original guarantee would usually include a clause to extend the guarantee to any subsequent OD increases.

Might be wort reviewing ALL of the wording of the agreement.

I'd agree that this is usual the most common outcome, but so far it sounds like Barclays has been unable to demonstrate this as the case with OP.

 

[dearyme]

I don't think the original OD and guarantee agreement mentions subsequent limit increases, but I'll give it another look tomorrow

 

[Lisa Thomas]

Saw a similar thread on here a few years back, but this is slightly different.

I took a £4k business overdraft out in 2015 with Barclays and agreed to a personal guarantee.

In 2017/18 I extended this to £12k

In 2020 I extended this to £49k.

By 2020 (and I am pretty sure in 2017) I had completely forgotten I gave a personal guarantee for the initial £4k. Due to a few things but mainly IR35 and Covid my business tanked and I maxed out my overdraft, making payments (£8k+) on the interest from a salary from a job. I then lost this job (still unemployed) and had no way to pay the interest. Barclays then kindly reminded me of the PG and insist it applies to the £49k (plus interest accruing at over £1k per month).

I requested multiple times that they show that they told me my extensions were subject to the PG and that I agreed to it. They've been unable to send me anything but the original agreement and PG from 2015.

My most recent request was in the form of a complaint and on the 8 week limit (during which they're still charging interest!) they sent me a copy of a letter they sent me in 2019 and 2023 within which they say 'by the way' any previous PG you gave still applies to your current OD limit. In the case of the 2023 letter I had already maxed out my OD!

I fully intend to repay my OD but Barclays' suggested solution of a resolve loan which would freeze the amount and give me 10 years to repay requires me to sign a PD for the full amount. The monthly interest is a heck of a stick to get me to agree I can tell you.

My contention with Barclays is why would I sign a PG for £49k if they're only able to show (after multiple requests and 4 months+) I agreed to a £4k PG.

What are my options here (if any)? Thanks in advance.

I know someone who specialises in disputing disputed PG's. DM if of interest.

 

[WaveJumper]

Just throwing this into the discussion - would not the PG apply to the actual "bank account" and thus any associated overdraft allowance they subsequently allow you to have. That was my understanding of the "system"

 

[WaveJumper]

Sorry meant to add - welcome to the UKBF @dearyme hope you can get this sorted

 

[Mark T Jones]

Just throwing this into the discussion - would not the PG apply to the actual "bank account" and thus any associated overdraft allowance they subsequently allow you to have. That was my understanding of the "system"

From memory,beyond words would be 'all monies' or 'continuing'

As always, the Devil is in the detail

 

[dearyme]

I know someone who specialises in disputing disputed PG's. DM if of interest.

Thank you. Started a 'conversation' which I assume is the same thing