Charging Order? The myth

eggbox

This is how all Solicitors should act on behalf of paying clients! They have no obligation to ensure a third party gets paid at the point of sale!

Good luck!

MrsJT_2

blueback wrote: »

I feel that this is so important that I thought a new thread should be made to highlight the importance of understanding the law on Charging Orders and how many people are stuck with their property in the false believe that they have had a Charging Order put on their property.

In particular the thousands of Northern Rock customers that have had unsecured debt turned into secured debt by their tactics.

If your property is jointly owned a creditor will not be able to obtain a CO against you, they can only get what is called a restriction.

The laws on Restrictions are totally different to Orders, the most important being there is NO OBLIGATION for you to pay any of the proceeds of the sale to the creditor.

However, during the whole court process you go through the reference from all parties (especially the creditor) will be to charging order and NOT to restriction. This is done in order to decieve you believing you are stuck with a CO.

However, not all solicitors are aware of the law in this regard and it is important that you raise this point with them in the first instance before proceeding with them

Quote:

Restriction


The restriction which can be entered on the register where a charging order is made against one of joint proprietors is in the following form :-
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 [name of person with the benefit of the charging order] at [address for service], being the person with the benefit of /I]an interim[I /I]a final[I charging order on the beneficial interest of (name of judgment debtor) made by the (name of court) on (date) (Court reference.…).
You are therefore correct in saying that when the Land Registry receives an application to register, for example a transfer, we will not ask to see the consent of the person who has the benefit of the charging order. We will only want a certificate from the applicant for registration or his conveyancer that the person who has the benefit of the charging order has been given written notice of the transfer.

If both joint owners sell the land to a third party the restriction will be cancelled when the transfer to the purchasers is registered.


So I hope I have provided benefit to everyone who has had a restriction entered against them (especially NORTHERN ROCK CUSTOMERS) who believe wrongly that they are Charging Orders.

You now have the freedom to go and sell your houses with the knowledge that the vultures can do nothing

I also think this VERY IMPORTANT point needs highlighting by the moderators as many many people are stuck with houses that they believe they cannot sell

Hi

I wonder if you could clear something up please? My mom signed to be a guarantor for my uncle many years ago on the lease of a shop, my dad had nothing to do with this and actually asked my mom not to do it.

Anyway mom gets a letter saying she needs to pay 6 months’ rent because her brother hadn't paid it, they were supposed to advise the first month he missed a payment.

Mom couldn't afford to pay this in one go so they took her to court and a charging order was applied to the jointly owned property. At no point has my dad ever agreed to being a guarantor or to this being applied to the house.

Since all this my mom has passed away and my dad is left with the worry of this CO on the house which is now his, how could they apply the CO on a joint ownership when my dad was not at any point a guarantor?

Can anything be done about this?

Thank you

DAKOTA45

MrsJT wrote: »

Hi

I wonder if you could clear something up please? My mom signed to be a guarantor for my uncle many years ago on the lease of a shop, my dad had nothing to do with this and actually asked my mom not to do it.

Anyway mom gets a letter saying she needs to pay 6 months’ rent because her brother hadn't paid it, they were supposed to advise the first month he missed a payment.

Mom couldn't afford to pay this in one go so they took her to court and a charging order was applied to the jointly owned property. At no point has my dad ever agreed to being a guarantor or to this being applied to the house.

Since all this my mom has passed away and my dad is left with the worry of this CO on the house which is now his, how could they apply the CO on a joint ownership when my dad was not at any point a guarantor?

Can anything be done about this?

Thank you

It doesn't seem very fair, does it?

I have been in litigation where my husband played no part whatsoever and even begged me not to go ahead, yet they can still put a charge on our property… it doesn't matter that the joint owner was not involved. They are the innocent parties who are punished for their partners' 'crimes'.

D45

eggbox

MrsJT wrote: »

Hi

I wonder if you could clear something up please? My mom signed to be a guarantor for my uncle many years ago on the lease of a shop, my dad had nothing to do with this and actually asked my mom not to do it.

Anyway mom gets a letter saying she needs to pay 6 months’ rent because her brother hadn't paid it, they were supposed to advise the first month he missed a payment.

Mom couldn't afford to pay this in one go so they took her to court and a charging order was applied to the jointly owned property. At no point has my dad ever agreed to being a guarantor or to this being applied to the house.

Since all this my mom has passed away and my dad is left with the worry of this CO on the house which is now his, how could they apply the CO on a joint ownership when my dad was not at any point a guarantor?

Can anything be done about this?

Thank you

The charge hasn't passed to your Dad it still remains against your Mom. Now that she has, unfortunately, passed away the creditor would have to make a claim against your Mom's estate which her part ownership of the property would form part of.

My advice is to make an application to the Land Registry to have the restriction removed (using an RX3 form) to see if the creditor objects? If they don't then no problem and the property can then be transferred totally to your Dad's ownership.

If they do you can explain the circumstances of why you have applied and, hopefully, they will withdraw their objection?

If they refuse ti withdraw the restriction, however, please come back here for further advice.

RMS2

eggbox wrote: »

This is how all Solicitors should act on behalf of paying clients! They have no obligation to ensure a third party gets paid at the point of sale!

Good luck!

'I will send the notices once contracts have been exchanged'

Completion is usually a month after exchange. But don't these charges normally only state 14 days notice. If so, why give them the extra notice?

DAKOTA45

RMS2 wrote: »

'I will send the notices once contracts have been exchanged'

Completion is usually a month after exchange. But don't these charges normally only state 14 days notice. If so, why give them the extra notice?

I think it is possible to exchange and complete on the same day in certain circumstances…

D45

eggbox

RMS2 wrote: »

'I will send the notices once contracts have been exchanged'

Completion is usually a month after exchange. But don't these charges normally only state 14 days notice. If so, why give them the extra notice?

Form K Restrictions don't carry any requirement for a period of notice. That's why the timing can be used to the sellers advantage.

But the Land Registry cannot complete the transfer until the Restriction has been complied with. So the buyers Solicitor is, almost certainly, going to have expected that to have happened when contracts are exchanged to ensure their clients transfer can proceed unhindered.

Its a balancing act, but most creditors (certainly as things currently stand on this issue) are expecting to get paid, anyway, so don't really do anything when notified of the sale?

RMS2

DAKOTA45 wrote: »

I think it is possible to exchange and complete on the same day in certain circumstances…

D45

It is possible, unusual though, due to most domestic property being a home and not a simple sale contract.

But if you were to do that, then surely the 14 days notice hasn't been given?

eggbox

RMS2 wrote: »

But if you were to do that, then surely the 14 days notice hasn't been given?

As I explained above, there isn't any "14 day" requirement in the terms of a Form K Restriction

DAKOTA45

eggbox wrote: »

As I explained above, there isn't any "14 day" requirement in the terms of a Form K Restriction

Unless the creditor also has a 'modified' restriction with words to that effect… as in my case.:(

D45