Charging Order? The myth

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  • eggbox
    eggbox Posts: 1,774 Forumite
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    It's not illegal but I do reckon it should be classed as "unfair practice" as these company's have no intention of proceeding with an Order For Sale as they know the odds of it happening are minute to impossible. This is why official court statistics reflect that less than 0.5% of all Charging Orders ever progress to the OFS stage. (And that's progress not what is granted)

    So they don't proceed as it's a waste if time and money to them as they know no sane Judge is going to order the sale of a family or primary property to a bottom feeding debt collection company who has OPTIONALLY purchased a debt for less than 10% of the original debt value. Along with the protections of TOLATA and also Case Law that defends such actions, it's a non starter (hence you will struggle to find any threads of where an OFS has happened)

    So they are relying on two things 1) you don't know any of the above and 2) that the fear of you losing your home will help extract money from you.

    Of the two cases I know where these threats have happened; the company concerned accepted as little as £1 a month as a repayment. So deal with the facts and not the fear with these scumbags.
  • harisumo
    harisumo Posts: 79 Forumite
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    The other thing that occurred to me is that if it were viable and easy for creditors to obtain OFS for this type of debt then I don't suppose companies like Northern Rock would sell them off for peanuts to DCA's but would take advantage themselves. NR must have spent a fortune in legal fees obtaining the CO's in the first place.
  • CoolWhip_2
    CoolWhip_2 Posts: 2 Newbie
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    eggbox wrote: »
    It's not illegal but I do reckon it should be classed as "unfair practice" as these company's have no intention of proceeding with an Order For Sale as they know the odds of it happening are minute to impossible. This is why official court statistics reflect that less than 0.5% of all Charging Orders ever progress to the OFS stage. (And that's progress not what is granted)

    So they don't proceed as it's a waste if time and money to them as they know no sane Judge is going to order the sale of a family or primary property to a bottom feeding debt collection company who has OPTIONALLY purchased a debt for less than 10% of the original debt value. Along with the protections of TOLATA and also Case Law that defends such actions, it's a non starter (hence you will struggle to find any threads of where an OFS has happened)

    So they are relying on two things 1) you don't know any of the above and 2) that the fear of you losing your home will help extract money from you.

    Of the two cases I know where these threats have happened; the company concerned accepted as little as £1 a month as a repayment. So deal with the facts and not the fear with these scumbags.

    Ah, thanks eggbox! In the back of my mind I wondered how likely it would be that things could be taken further, as the wording of the letter was so 'final', but this is reassuring! I will have a thorough read through the rest of the thread. Thanks again! :T
  • eggbox
    eggbox Posts: 1,774 Forumite
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    harisumo wrote: »
    The other thing that occurred to me is that if it were viable and easy for creditors to obtain OFS for this type of debt then I don't suppose companies like Northern Rock would sell them off for peanuts to DCA's but would take advantage themselves. NR must have spent a fortune in legal fees obtaining the CO's in the first place.

    Charging Orders do, by and large, work for the creditor usually in effecting a larger repayment from the debtor or being paid when the debtor sells up. But the recession and the slow down in the housing market meant many original debtors (high street banks) saw a lot of long term debt appearing on their books with little chance of it, realistically, being repaid in the near future.

    So for accounting reasons they prefer to sell it off to the bottom feeders for two reasons, 1) they can write the loss off against tax 2) they lose the reputational issues associated with threatening to force people to sell their homes to repay their debt.
  • harisumo
    harisumo Posts: 79 Forumite
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    That makes sense, thanks Eggbox. Marlin/Mortimer Clarke don't seem to worry about their reputation or the lengths they go to to initimidate people. I read somewhere that Marlin are one of the worst, apparently they featured on a Dispatches programme about unscrupulous DC's on TV a while ago.
  • eggbox
    eggbox Posts: 1,774 Forumite
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    Hi Land Registry Rep


    Further to the Legal Charge I discussed a while back, the people concerned have written to their mortgage provider but they have so far not replied? I have been trying to find out a little more if consent is needed and came across the below (my link button doesn't work? But open up the PDF files it links to)
    http://www.google.co.uk/url?sa=t&rct=j&q=&esrc=s&source=web&cd=1&cad=rja&uact=8&ved=0CCYQFjAA&url=http%3A%2F%2Fwww.parliament.uk%2Fbriefing-papers%2FSN04837.pdf&ei=0LoFVNGINKmL7AaVnoHQCA&usg=AFQjCNFIZ2LUDyKRNqQIp7xN5GU26uYJpw&sig2=jnQ3nhdlRv5nPpsPYXIS7A


    It's Section 5 I'd like you to look at please and, if you are able, could you explain what they mean by a "unilateral notice"
  • Thrugelmir
    Thrugelmir Posts: 89,546 Forumite
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    harisumo wrote: »
    The other thing that occurred to me is that if it were viable and easy for creditors to obtain OFS for this type of debt then I don't suppose companies like Northern Rock would sell them off for peanuts to DCA's but would take advantage themselves. NR must have spent a fortune in legal fees obtaining the CO's in the first place.

    NRAM's role is to wind up the lending book as quickly and efficiently as possible. The discounted sale price of the debt takes into account that the money may not be released for many years yet. Rather than incur further administration costs, far cheaper to take the hit on the chin now.
  • Land_Registry
    Land_Registry Posts: 5,782 Organisation Representative
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    eggbox - the link won't work or open for me either I'm afraid

    Our online guidance explains what a Unilateral Notice is although not being able to view the link means I cannot see in what context they are referring to it.

    From a purely land registration perspective an Agreed and Unilateral Notice are two different types of protection for third party interests
    “Official Company Representative
    I am the official company representative of Land Registry. MSE has given permission for me to post in response to queries about the company, so that I can help solve issues. You can see my name on the companies with permission to post list. I am not allowed to tout for business at all. If you believe I am please report it to forumteam@moneysavingexpert.com This does NOT imply any form of approval of my company or its products by MSE"
  • eggbox
    eggbox Posts: 1,774 Forumite
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    Hi LRR I will try to paste again but if you click the link a page doesn't open but an option to view a PDF file at the bottom appears.
  • eggbox
    eggbox Posts: 1,774 Forumite
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    Try this one


    http://webcache.googleusercontent.com/search?q=cache:IV_4glfMQD4J:www.parliament.uk/briefing-papers/SN04837.pdf+&cd=1&hl=en&ct=clnk&gl=uk
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