Charging Order? The myth

eggbox

The Land Registry will confirm that the Restrictions will automatically be removed if a) the terms of the Restriction have been complied with and b) the sale has been made for "valuable consideration" (money). This will be because the Restrictions become "overreached" (as explained in LR Practice Guide 76) and therefore obviously "superflous" - you can't have Restrictions against a person who no longer owns the property.

Be prepared for a fight but you can use Brightonians approach a few posts back, and say you are happy for the sale proceeds to be transferred once the new owners details are registered at the Land Registry along with confirmation the Restrictions have been removed due to the above.

sdoherty1000

I have a cc debt that I have offered to pay off, currently stands at £1065 but I have offered £300 as I cant afford to pay the full amount. When I spoke to the guy from the debt collection agency he told me the debt is secured against the house so the amount can not be lowered. The house is jointly owned by me and my wife so are you telling me that the debt is not secured on the house and I should move forward with the £300 I have offered?

eggbox

The charge will only be secured on your property if your wife is a joint debtor. If the debt is solely yours it will be registered against your "beneficial interest" or equity. Your debt collector can settle the debt for any amount it likes, he's trying to be clever as he thinks you won't know the difference.

Explain you know the charge is not registered against the property, it's only notified by a restriction and there is also no obligation to settle a charge notified by a restriction when the house is sold. Then see if he gets more interested in your offer?

Truckmuck

Thank you Eggbox.... that is really useful, I will try my best if the Solicitors will listen and update if I have a resolution!

Could the Land Registry Representative on herr confirm this too please.....just for clarity the wording on the 3 restrictions is as follows :

"RESTRICTION: No disposition of the registered estate is to be registered without a certificate signed by the applicant for registration or his conveyancer that written notice of the disposition was given to ........ being the person with the benefit of an interim charging order on the beneficial interest of ...........made by the ......county court on .......2007"

Kind regards.

Land_Registry

Truckmuck - the issues outlined by eggbox and the general approach to such restrictions is referred to throughout this thread. I cannot confirm what eggbox is specifically referring to above though as we are not involved in how such debts are settled for example.

The wording of the restriction is always crucial when you are seeking to comply with it's requirements. As it states, No disposition (in most cases a Transfer on sale for monies) can be registered without the applicant (your conveyancer) certifying that they have given notice to the person with the benefit of the charging order (as named in the restriction) of the said sale.

As such providing your solicitor provides a certificate confirming this then the terms of the restriction are complied with.

The restriction(s) would then be removed when the transfer (sale) is registered which overreaches the interest protected by the restriction.

eggbox

Land_Registry_representative wrote: »

As such providing your solicitor provides a certificate confirming this then the terms of the restriction are complied with.

The restriction(s) would then be removed when the transfer (sale) is registered which overreaches the interest protected by the restriction.

This information is given by an OFFICIAL LAND REGISTRY REPRESENTATIVE!


Please therefore USE this information when selling with a Restriction to deal with obstinate*/misinformed*/ignorant*/under qualified*/lazy* Solicitors and Conveyancer's who try to tell you DIFFERENT!


*delete as appropriate

eggbox

Land_Registry_representative wrote: »

I cannot confirm what eggbox is specifically referring to above though as we are not involved in how such debts are settled for example.

If a creditor is owed money then he can choose to make a "Full and Final" settlement with the debtor for any amount (below the debt amount owed) that they are willing to accept to end the debtors liability for the money owed.


The fact a creditor has a Charging Order in place on the debt is, firstly, of absolutely no consequence to the creditors ability to make a decision to accept less and, secondly, is usually a major factor of why a F&F settlement is often reached.


This is due to the creditor often preferring to take a smaller return now than waiting many years for a possible full repayment.


Also, many people on this site will have seen banks like Lloyds, MBNA, and Barclays selling on their debts secured by charging orders to company's such as Marlin and Lowells for approximately 10% (and probably less) amount. That means a £10k debt is sold for just £1k :eek:

eggbox

Hi LRR


A quick question if I may!


I have a client who wants to protect the money loaned by his son for a business venture by way of a voluntary charge on his house in his son's favour.


What form is required to register this type of charge and does this charge take priority in similar fashion to a court enforced charging order?

Land_Registry

The form for a legal charge is form CH1 and you would need to submit it under cover of a form AP1 along with the required ID1 forms as evidence of identity etc

As far as priority is concerned this is normally assessed in registration terms on the order in which entries are made.
I am not too sure what you mean exactly by 'in a similar fashion'. If you mean is it treated in the same way as any other interest as and when the first chargee exercises their power of sale then Yes any entries which have a lesser priority will be cancelled on registration of the transfer under power of sale.

eggbox

Land_Registry_representative wrote: »

I am not too sure what you mean exactly by 'in a similar fashion'. If you mean is it treated in the same way as any other interest as and when the first chargee exercises their power of sale then Yes any entries which have a lesser priority will be cancelled on registration of the transfer under power of sale.

Thank you for the info sent and that's exactly what I meant by "similar fashion"


(but I feel my term is far more succinct:))