Charging Order? The myth

eggbox

Helpappreciated

As I said previously, he won't be able to provide evidence that that you, legally, have to pay off your Creditor. That he's still insisting you still should is a disgrace given he's being paid to look after your interests. Perhaps you should remind him of that fact?

Good luck with your new Solicitor!

eggbox

Received today from LR Solicitor;

LAND REGISTRY RESPONSE

"The provision of the Certificate mentioned in the Form K restriction means that the registrar is not prevented from proceeding with the application to register a disposition (for example, a transfer or charge) and the registration can proceed.

The certificate does not affect the restriction entry. A restriction in Form K may be removed from the register in the following circumstances.

Automatic cancellation

When a transfer of property is registered (following receipt of the required certificate) the restriction may or may not be automatically cancelled, depending on the circumstances of the transfer. If, for example, the application is to register a transfer by two or more proprietors to a third party for value, the trust interests will be overreached and the form K restriction will usually be cancelled"

Application to cancel in form RX3

If the charging order is discharged by the court, or if the debt secured by the charging order is paid in full, or for any other reason the restriction is no longer required, application may be made at any time to cancel the restriction. If such an application is made, notice will be served on the restrictioner and the restrictioner may object to the application. If the objection is not groundless, and the parties cannot come to an agreement, the dispute will be referred to the Adjudicator for determination"

So there you have it in black and white from the LR!

A Form K cannot prevent a sale as it cannot prevent a change in the registration if you have complied by giving notice to the Restriction Holder.

The RX3 is, in my opinion, only relevant if you are wishing to stay put and want the Restriction removed. However, my situation (I'll bore you with the details another time) may well mean that the RX3 Form could be of use to me.

Any comments on the above info?

Sparklyfairy

Brilliant! Thanks for posting that info.

Automatic Cancellation - I have read about the Transfer of Equity - Restriction won't be cancelled. So much easier to understand when it's written in laymen terms..!

Just a question...so it's up to us/our solicitors - not our buyers solicitors - to give notice to the restriction holder? It seems to flip flop..but I'd actually prefer to be the one (or my solicitor) to write the letter so I know when it was posted, etc..

eggbox

Sparklyfairy

I know both sides Solicitors have to notify the Land Registry of a transfer but Form K says the signed Certificate required should be received from ;

"the applicant for registration or their conveyancer"

which I read as the new owner or their Solicitor?

This would be logical as it ensures New buyers are aware of the Restriction.

Sparklyfairy

Ah, thanks for clarifying! As you wrote earlier - it's important that the buyer's solicitor is clear on the difference between charging orders & restrictions..another reason why hiring a competant solicitor is key here as they may have to "educate" them if they are not!

eggbox

Sparklyfairy

Can you just clarify where you saw selling to a family member wouldn't cancel a restriction, please, as I can't see how that would hold up if it was a sale where money changed hands?

Sparklyfairy

Hi Egg - sure, in post number 69 of this thread it reads:

"Restrictions and Transfer of Equity
I thought I just drop a quick line to tell others what happened to my transfer of equity dilemma. My ex husband received a retriction order against our jointly owned property. The debt was in his sole name so the charging order was against his share only. As part of the divorce settlement, he was to transfer his equity to my name. I was hoping that TOE would be possible without paying his debt off. I had a very helpful conveyencing solicitor who tried very hard to resolve this but at the end it wasn't possible to transfer the equity & remortgage purely because property was not being transferred to a 3rd Party. If I was selling the house, it would have been just fine, we would not be obliged to pay them anything and the restriction would fall away. As for me, at the end I negotiated with the bank and they accepted my offer with 65% discount, I paid off my ex's debt, only then we went ahead and completed within a day. So what I know for sure is, if the charging order is registered as restriction in the Proprietership register, then you can sell and go without paying them a penny. Restriction is not in the charges register, so it won't matter. But the transfer of the deeds must be to a 3rd party. In my case it wasn't, because I was taking over my ex's equity. Hope this helps others in similar situations.. "

Hth, SF

eggbox

Sparklyfairy

Sorry, I misunderstood you were talking about a Transfer of Equity. I thought you had read a family member couldn't buy your house.

Helpappreciated

Let us know what your new Solicitor makes of all this ok?

Sparklyfairy

Oop yes, I've ammended my comment above to clarify ToE..:o

Rayp

Many thanks to all regarding this thread and maybe now I can put it maybe to rest. I have just come home from a meeting with my solicitor
who has confirmed there is nothing to worry about. It is the purchasers solicitor responsibility to inform the loan company that the property
is sold and this will be done on the day of sale. He has also confirmed that as the restriction is the responsibility of my ex wife it is her
solicitors duty to also inform them, though he stated he will send a letter also. Upon sale the restriction will be cancelled on the day of completion
to the new owners. I hope this puts your minds at rest. It has mine. My x is under no obligation to pay the debt though they can chase it via other
means.