Charging Order? The myth

DAKOTA45

Thank you, Eggbox.
I was wondering if, once I've given the creditor 14 days notice, he can make an application to the court to freeze my assets prior to the sale completing… or something.

But it's a joint mortgage so I wonder what the legality of that would be, where the debt is not jointly shared by my husband?

The other thing is that my husband and I don't have a joint bank account as we are separated (but not divorced).

Would the fact that I have now a large claim against the creditor have any implications as to whether I can sell my property or would I have to wait until after the trial to see who owes what to whom?

So complicated… I have a strong case against the creditor but he is armed to the teeth with barristers and lawyers… and if I lose my claim, there will be tens of thousands more in legal fees to pay, wiping out any equity I may have had.

I really need a solicitor, but I'm living hand to mouth atm, so it's all pie in the sky…

D45

eggbox

Hi Dakota

As previously discussed, a freezing application carries, potentially, a huge financial risk for the person applying for the application. So its an unlikely course of action? Would anything change if you put your house up for sale before the case was heard, unfortunately that is something you would only find out by putting your house up for sale?

The most likely outcome is nothing would happen as the creditor still, currently, has the CO in place?

WardyP

Hi, i have read a lot of this thread, and it would appear that disposing if the property is the easiest method of removing a restriction!
Can anyone please offer any advice on the folliwing scenario?
A restriction was added to the Proprietorship Register in 2009, in relation to a CCJ with Toyota finance. The property is jointly owned by my sister (V) and her ex (T).
They divorced in 2010.
V was unable to remove T from the property during the divorce due to arrears that had built up and tge CCJ and the negligible equity in the property at the time.
The divorce settlement indemnified T from further mortgage payments but cancelled any rights to sny future equity also.
7yrs on he told her he'd cleared the ccj (i think he assumed not shiwing on hus credit file was the same thing) and demanded to be removed from the mortgage.
V now has a mortgage offer with her current husband. Conveyancers have advised that they cannot proceed due to the restriction.
T will not discuss ir provide infirmation.

1. What can Toyota benefit if a court order states he has no equity?
2. Is there any way of removing this restriction 8yrs on?
3. Due to DPA Toyota cant tell her what is outstanding, yet they hold a restriction on a jointly owned property. Is there any way she can find the balance to consifer whether to pay it off?
Or, given that she doesnt really want to move, is her only other option to transfer the property into her husbands name? Who had no interest previously?

Thank you to anyone able to offer their experience or expertise

DAKOTA45

eggbox wrote: »

Hi Dakota

As previously discussed, a freezing application carries, potentially, a huge financial risk for the person applying for the application. So its an unlikely course of action? Would anything change if you put your house up for sale before the case was heard, unfortunately that is something you would only find out by putting your house up for sale?

The most likely outcome is nothing would happen as the creditor still, currently, has the CO in place?

Thank you Eggbox…
Presumably, as it's a jointly owned property and half of the equity is my husbands, they wouldn't be allowed to freeze his assets as it's not his debt… or am I wrong? (We don't have a joint bank account).
D45

eggbox

Wardy P in answer to your questions,

WardyP wrote: »

1. What can Toyota benefit if a court order states he has no equity?
If the Restriction CO was granted prior to the Divorce then it will take precedence by virtue of date. Anything decided after the date of the CO should exclude the amount secured in favour of the CO by the Court? But it would be in your interests to see if the CO is attracting interest as that could cause problems down the line?

2. Is there any way of removing this restriction 8yrs on?
3 ways - Pay off the amount due to the creditor then request its removal, request the Creditor remove the Restriction (you can always try saying divorce Court has left T without any equity) or sell the property in the manner outlined in this thread.

3. Due to DPA Toyota cant tell her what is outstanding, yet they hold a restriction on a jointly owned property. Is there any way she can find the balance to consifer whether to pay it off?
Explain the circumstances of the divorce and explain you are now planning to sell the property and require a settlement figure and that should get them motivated.

Or, given that she doesnt really want to move, is her only other option to transfer the property into her husbands name? Who had no interest previously? Transferring the property doesn't remove the Restriction, but if your sisters new partner could purchase the property on his own then your sister could re-add her name to the deeds after the sale when its clean?

Also, if your sister doesn't want to move then tell her not to worry as Toyota won't be able to try and enforce a sale.

modnod

Scenario help please.

Mr and Mrs X have sold their property that they jointly own, and as described in this thread, completed by writing to parties that had interim CO on title (Mr X received the CO only). First charge mortgage was paid back and not the CO's. Great.

However one of the creditors are now asking for monies from their CO. Can they do this and what enforcement actions can they apply?

eggbox

modnod

Yes they can (they do after all have a Charging Order attached to the debt?)

Whether they will try and enforce the debt will, most likely, depend on what chances they feel they have by doing so? So that largely depends on what encouragement that you give them you have the means to settle the debt?

RMS2

eggbox wrote: »

modnod

Yes they can (they do after all have a Charging Order attached to the debt?)

Whether they will try and enforce the debt will, most likely, depend on what chances they feel they have by doing so? So that largely depends on what encouragement that you give them you have the means to settle the debt?

For clarification. Now that the property has been sold, has the charging ordered not disappeared,? Yes the debt remains, but not the CO.

eggbox

The CO is made against whatever "Beneficial Interest" (equity) the debtor has in the property. When the debtor sells the property the creditor is entitled to receive, through the CO, the value of the debt owed to be taken from the proceeds the debtor has realised? Being entitled and actually receiving are, however, two different things.

The difficulty for the creditor is that there is nothing to prevent the debtor (barring unaware Solicitors) from not paying over what is owed at the point of sale and still being able to transfer the property to the new purchaser. So whilst the creditor is, legally, entitled to the proceeds getting them is a whole different ball game?

I know through experience that it comes as quite a shock to many people who take a person to Court for a debt owed, to discover that once they receive a Judgement from the Court, in their favour, they then have to understand that is only the start of the recovery process not the end. The Court does nothing further to recover the debt unless the person who is owed the debt then pays more money to try and recover the debt themselves?

This is the problem with a CO that hasn't being paid when a property is sold. The CO does still exist against the proceeds the debtor realised through the property sale, the difficulty is the creditor will then have to spend more time and money trying to discover where the proceeds are?

As we've discussed on here previously, debt collection isn't vindictive it's a business. If a creditor has spent time and Court fees obtaining a Charging Order against a debtors asset, but still finds they haven't been repaid; are they then likely to spend further money chasing the debt?
You can never say never and the size of the debt will be a factor (especially if they have only spent pennies to the pound buying the debt); but I would say its unlikely purely on a business cost factor.

DAKOTA45

Hi Eggbox…
I really need to think about selling my property as the lender is chasing for arrears now… just wondering what the chances are of selling without paying the CO, especially as I have a claim against the owner of the charge.
(As you know, the CO is unfortunately a modified one and I have to give 14 days notice before disposal).
I guess it depends on the solicitor…
I'm wondering, given the circumstances, whether or not I can insist that the charge isn't paid until there is a judgement re my claim... It's getting so complicated.
D45