Neighbours & Loans

[NobleGuy]

I'm sure it's nothing to worry about, but...

I was at my mum's over Xmas and she mentioned that her neighbours came round about 18 months ago for her to sign something to do with a new loan that they were taking out. Apparently it's the 2nd time they've done this.

When she mentioned this both my brother and I came to the same conclusion at the same time - that maybe they'd used her unwittingly as a guarantor.
Neither of us could think of another reason why they'd need her signature.

I haven't taken a loan out for years, so is it possible we're overreacting? Could it have just been to witness their identity?
When we asked her more about it she just came out with some vague "oh they explained it at the time, but I didn't read it...they're nice people so I trust them".

They do appear to be nice people, but is there any way I can check to see if she's a guarantor on a loan without either annoying or worrying her (i.e. I don't want to ask her about it again as I know she'll get defensive)?

[weeboot]

Presumably a check of her credit report via experian or another provider would show some record?

[silentbrown]

Mortgage documents need to be witnessed, don't they?

[thebraketester]

Everything will be fine....... until they default on a payment. They they will want cash or her house.

[xjay1337]

weeboot said:

Presumably a check of her credit report via experian or another provider would show some record?

Yes do this.

[WindyCommon]

thebraketester said:

Everything will be fine....... until they default on a payment. They they will want cash or her house.

This statement is either malicious or ill-informed. PH at its very worst.

It is entirely possible that the neighbours were just asking for their signatures to be witnessed. This is a common requirement on loan security documentation, and nothing to worry about at all.

[NobleGuy]

thebraketester said:

Everything will be fine....... until they default on a payment. They they will want cash or her house.

That's almost word-for-word what I said to her!

WindyCommon said:

thebraketester said:

Everything will be fine....... until they default on a payment. They they will want cash or her house.

This statement is either malicious or ill-informed. PH at its very worst.

It is entirely possible that the neighbours were just asking for their signatures to be witnessed. This is a common requirement on loan security documentation, and nothing to worry about at all.

I do get your point, but it was my first thought too...I haven't taken a loan out for years so I wasn't even sure if they still do that kind of paperwork or if it's more automated these days via ID numbers such as passport or driver's licence.

xjay1337 said:

weeboot said:

Presumably a check of her credit report via experian or another provider would show some record?

Yes do this.

Don't I need some details like account numbers (I don't know these and I doubt I'd be able to ask...) to do this, or do I just need name, DOB, past addresses etc. (I know all of that).

Edited by NobleGuy on Thursday 2nd January 13:22

[WolfAir]

Amigo loans which uses guarantor will not show up on her credit file...unless the borrowers choose not to pay the loan.. i know from experience how aggressive amigo are in charging a ccj.
Why not ask the neighbours directly? Could be something innocent..

[NobleGuy]

WolfAir said:

Amigo loans which uses guarantor will not show up on her credit file...unless the borrowers choose not to pay the loan.. i know from experience how aggressive amigo are in charging a ccj.
Why not ask the neighbours directly? Could be something innocent..

I don't actually live up there and I barely know them.
Plus it's hard to say "mum said she signed something for you - what was it?" without making it sound like the SS have come calling with a spotlight

[thebraketester]

WindyCommon said:

thebraketester said:

Everything will be fine....... until they default on a payment. They they will want cash or her house.

This statement is either malicious or ill-informed. PH at its very worst.

It is entirely possible that the neighbours were just asking for their signatures to be witnessed. This is a common requirement on loan security documentation, and nothing to worry about at all.

It’s also entirely possible that I am correct.

[WindyCommon]

thebraketester said:

WindyCommon said:

thebraketester said:

Everything will be fine....... until they default on a payment. They they will want cash or her house.

This statement is either malicious or ill-informed. PH at its very worst.

It is entirely possible that the neighbours were just asking for their signatures to be witnessed. This is a common requirement on loan security documentation, and nothing to worry about at all.

It’s also entirely possible that I am correct.

Lenders generally require the same information (income, assets/liabilities etc) from a guarantor as they do from the principal borrower. Also, permission to conduct credit checks etc. They will want to know that any assets pledged as security by the guarantor are unencumbered. Was your mother asked for any of this?

In your original post OP, you say you don't know of any reason why her signature might have been requested. In reality this is standard practice when documentation is being exchanged by post. Witnessing a signature on a document doesn't require the witness to have any knowledge of what is in the document. Only that they witnessed the signature(s) being made.

thebraketester's unqualified assertion that a single signature has put your mother's house in peril should her neighbours miss a loan payment can be safely ignored.

[Caddyshack]

For a mortgage guarantor they also need to be encouraged to take independent legal advice, it would be hard to enforce a guarantor when they did not know what they had signed. I expect they would get documentation sent directly to them as well.

[NobleGuy]

Hmmm, that does all sound fairly reasonable.

Deep down I'd be shocked if the neighbours were like that as they've always been 100% decent in the past.

Just playing devil's advocate, could they have redirected any documentation next door to avoid suspicion?
Sorry if that sounds daft, but I really am completely out of the loop with modern loan processes

Just to clarify, it sounded more like a loan rather than a (re-)mortgage.

[anonymous-user]

thebraketester said:

It’s also entirely possible that I am correct.

No really, it's not.

If your Mum was going to be bound to some legal agreement she would have needed to go and find someone to witness her signature.
Even if she had done that, there would still be a get-out as explained by Caddyshack above.

[anonymous-user]

Can you not go and talk to the neighbour and ask what has been signed?

If they get defensive then I think you may have something to worry about but, as has been said, it could simply be a witness signature which I do with my neighbours.

You do need to find out though - if it's dodgy and your mum was coerced or misled then that may be the time to take it further.

[NobleGuy]

I've just been on Experian and at the end of the process they gave me 5 options for a loan company and 5 options for a monthly payment amount that they seem to think is associated with her.

I randomly picked a pair and I'm now waiting on their checks to see if they can identify my mum based on the details I've provided.
Bit worrying that they didn't give me a "I have no loans" option...I suppose the options might be old ones she's had in the dim and distant past.

[98elise]

silentbrown said:

Mortgage documents need to be witnessed, don't they?

Yes, and we get our neighbour to witness ours.

[NickCQ]

NobleGuy said:

Ineighbours came round about 18 months ago for her to sign something to do with a new loan that they were taking out

If nothing has happened in the last 18 months then she's probably safe whatever it was.
I think guarantor loans are usually shorter term, like payday loans.