Charging Order? The myth

joan1920

I had a charge order on my property, when I sold it was on a buy to rent back basis, left the property andthe purchaser now the landlord landlord let property get repocessed, as a result lender sold property at auction despite me having a charge on it in the form of retained equity which was owed on the property to the tune of £30,500 from the purchaser. I could not stop the charge from being removed as the lender takes priority over any charge order and I lost everything I challenged this both at the Land Registry and my solicitor, alas I was told the same by all parties sorry to be a bearer of bad news but it has nothing to do with what the seller or buyer wants its probably an unwritten law or something similar that lenders have in place to safeguard their interest on a property, so I would imagine that if the seller is due to get monies from the property prior to someone with a second charge then the charge would have to be honoured and then any surplus funds would then go to the seller, if however there are none such as in my case, then you would have to go to court to recoup your losses like I did hope this helps

eggbox

Hi joan1920


It's a little difficult to follow what you have said as no punctuation in your post?


What are you saying you are the "bearer of bad news" about?

kanute50

wembley14 wrote: »

Thanks for the additional info eggbox.
This shows that the buyers solicitor is not acting in their best interests, if she is not willing to use the laws that are there. So what possible benefits is she actually achieving for her clients.


My wife is now telling me to bite the bullet and pay the debt off out of proceeds and go back to our original solicitor due to him having all the info. She wishes I had never seen BLUEBACK'S initial thread, I am gutted, just like to say to BRIGHTONIAN a big well done in succeeding. I will keep you all posted on final outcome.

Is it really worth losing the sale of your house on a principal? I agree with your wife, perhaps it is best for the sake of completion of your sale to "bite the bullet" and pay what is owed.

eggbox

kanute50 wrote: »

Is it really worth losing the sale of your house on a principal? I agree with your wife, perhaps it is best for the sake of completion of your sale to "bite the bullet" and pay what is owed.

He's not holding out on a "principal" he's trying to keep several thousand pounds he has no legal obligation to pay when the sale is completed.

kanute50

eggbox wrote: »

He's not holding out on a "principal" he's trying to keep several thousand pounds he has no legal obligation to pay when the sale is completed.

The legal obligation seems to be the sticking point here. Presumably the lender has a different take on whether there is a legal obligation or not. However I am not making any judgement on that, I merely stated that surely it would be better to pay the money that relates to the "Charging Order" rather than letting a sale fall through.

eggbox

The lender can have any view it likes, the fact is there is no legal obligation to pay at the point of sale (as confirmed by both HMRC and the Land Registry) Neither does non payment prevent the new owner/s from purchasing the house. Therefore, conveyancers who refuse to act without the CO being paid off, when only notified by a Restriction, are failing their clients.

These are clients, remember, paying Solicitors to safeguard their clients interests and not those of a third party? It may well be that the debt is settled rather than losing the sale - but why should this continue to be the norm?

kanute50

Both the purchaser and the vendor have incurred legal costs, and both must be exasperated by all this. Let's hope someone will see common sense and come to a compromise, even if that means the payment of the Debt that the Charging Order relates.


The way things are going there are going to be 2 sets of people who will be out of pocket with nothing to show for these expenses.

eggbox

kanute50 wrote: »

The way things are going there are going to be 2 sets of people who will be out of pocket with nothing to show for these expenses.

Which is why Solicitors should be brought to book as non of them ever provide evidence why the CO noted by the Restriction "has" to be settled prior to a sale?


They will site a "clear title" as being required but there is no charge attached to the legal estate and the Restriction only requires notification that the creditor has been made aware of the sale to be removed (as it then becomes overeached)?

kanute50

eggbox wrote: »

Which is why Solicitors should be brought to book as non of them ever provide evidence why the CO noted by the Restriction "has" to be settled prior to a sale?


They will site a "clear title" as being required but there is no charge attached to the legal estate and the Restriction only requires notification that the creditor has been made aware of the sale to be removed (as it then becomes overeached)?

Until the day arrives when all solicitors become "enlightened" as to whether these Restrictions have to be settled, many vendors and purchasers are going to face an uphill struggle. Selling/Purchasing a house is stressful enough without adding to the stress. If there is sufficient equity in a property, I can't see why people would not welcome the opportunity of clearing debts and starting anew with a clean slate. That is only my opinion, and I am in no way criticising WEMBLEY, or anyone else for that matter, for choosing not to do this, after all I do not know their financial circumstances.


BRIGHTONIAN has posted his success, have you also been successful on behalf of your ex wife? It would also be interesting to find out what actions the holder of the Charging Order/Restriction took when BRIGHTONIAN's Solicitor failed to pay on completion.

eggbox

kanute50 wrote: »

Until the day arrives when all solicitors become "enlightened" as to whether these Restrictions have to be settled, many vendors and purchasers are going to face an uphill struggle

That "day" is only going to happen when enough people become as determined as Brightonian was in getting past Solicitor bias and obstinacy.

kanute50 wrote: »

If there is sufficient equity in a property, I can't see why people would not welcome the opportunity of clearing debts
.

Because these "debts" were unsecured credit which the customer paid higher premiums for as a result. The creditor has had the benefit of these higher returns AND has also been able to secure its debt despite them being labelled "unsecure". How, on any planet, is that fair?

kanute50 wrote: »

It would also be interesting to find out what actions the holder of the Charging Order/Restriction took when BRIGHTONIAN's Solicitor failed to pay on completion.

My understanding is a rep from the creditor was still trying to collect and being smug about having a CO on the house. Unfortunately, Brightonian had to explain the property had been sold. I believe the rep is still sitting at his desk with his mouth open wondering what to do next?