Something I have been looking at for a while which very little is known about in the wider public, but could have major potential issues. When obtaining a mortgage, some major lenders' (normally RBS and Bank of Ireland) insert a clause in their security over your property known as an 'all sums clause' or 'all monies clause'

These mortgage agreements could lead to homeowners losing their property should they default on any additional borrowing (ie overdraft, unsecured personal loans etc) as far from being an unsecured loan, further borrowing or an overdraft with their mortgage lender could in fact be secured against their property if the original mortgage agreement included an ÔÇÿall sums/monies' clause.

The ÔÇÿAll Monies Charge' clause in the mortgage agreement documents issued by some lenders means the lender secures all debt against the mortgaged property, including any additional borrowing such as personal loans or overdrafts. This means they are entitled to repossess the property should the borrower default on these.

In simple terms, you go to a bank and get a mortgage. 2 years down the line you get an unsecured loan and also have an agreed overdraft with the same bank. If you were to sell the property, the bank are within their rights to force you to clear the loan and overdraft. Alternatively if you were to default on the loan, they could in theory call in their security and force the sale of the house.

Sorry if this puts the fear of God into people, but I think its important to be aware of these things.

Mark