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13 Feb, 2008

Leah Milner
Date: 13-Feb-2008

A man has been allowed to keep his home despite making no mortgage payments for the past 15 years.
Djabar Babai of Heaton Mersey, Stockport has not made a mortgage payment since 1993, but was declared bankrupt months later, say national press reports.

Despite bankruptcy, Babai continued to live in his home - now worth £200,000, racking

Babai's mortgage lender, NatWest made a formal demand for payment, but delayed repossession proceedings.

Last year the trustees of bankruptcy - acting on behalf of Babai's other creditors - won a High Court ruling that NatWest could no longer repossess the property because 12 years had elapsed so the deadline for enforcing the mortgage had passed and Babai had squatter's rights to continue living in his home.

NatWest appealed but last Friday Lord Justice Mummery ruled that its right to take possession of the property was "barred" under the 1980 Limitation Act.

Justin Fenwick QC representing NatWest said that banks could now be forced to issue possession proceedings where they might not otherwise have done so in order to protect their securities.

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