Charging Order? The myth

eggbox

Hi Marblesue
The rule is once you've sold you have to ensure the creditor has no, visible, assets to come after. Debt collection is a business like any other and they will only pursue you if they have something to claim otherwise they are throwing away good money after bad. So if you are planning to buy a new house with your proceeds you need to ensure your name isn't on the deeds (or I'd advise the electoral role) and any money is in a joint account. 

Stesar's example is, in my experience,  extremely rare and they've gone after him hard as, unfortunately, he's allowed them, too. They also know a CO is no good as he understands how to avoid payment. So you need to plan properly and make sure you drop off the radar for a good few years. A good way to do this is to have all your mail forwarded to a PO Box after you've sold up which can be re-routed to your new address.

Marblesue

I had always thought I'd offer them a full and final settlement after the event. The debt was sold several times over so I imagine the current owner got it for absolute peanuts. They took it to court and obtained a charging order adding 2k onto it for costs. I had tried to come to an arrangement when I originally fell into arrears through illness and loss of job but they weren't interested and must have sold it on quite quickly. What I find distasteful about the system is the debt purchasers who buy these for miniscule amounts with the sole intention of making a profit out of someone else's misery. Anyway ive taken on board what you said. Thank you

eggbox

Hi Marblesue 
 The points you've raised highlight why anyone trying to evade this type of debt shouldn't feel any remorse. The original lenders sell their debts for between 4 - 10% of their value. So any F&F settlement should always bear that in mind.

Land_Registry

eggbox and Stesar - “I also don't think the buyers conveyancer has acted negligently. This is because there is no time frame set on a Form K restriction so it can be complied with at anytime? If we accept that what you say has happened, however, then it would be for the Land Registry to request the compliance before proceeding any further. It will also be up to the Land Registry to explain to the creditor why they have registered a new owner in the absence of the restriction being complied with? (Land Registry Rep may have a view on that?)”

When the purchaser makes their application to update the register the conveyancer has to comply with restriction in order that it is overreached and cancelled. It reads as if they certified they had but then did so later. If so then they may have left themselves open to criticism/action but they’ve taken responsibility for that risk. 

If they didn’t certify that they had complied with the restriction and we registered the purchaser and removed the restriction then seems likely we were at fault. But that doesn’t seem to be what’s being suggested here 

eggbox

Land Registry Rep
Stesar will hopefully confirm which it was,  however, "The conveyancer acting on behalf of the purchaser, who clearly didn't understand the process, despite being instructed what to do by solicitor, didn't inform the CO holder until a month after completion" reads to me that nothing was done until a month after completion?

I could be wrong but It would be hard to imagine that,  even the poorest performing conveyancer, wouldnt understand that they were certifying to the Land Registry a task that they would , surely, understand that they hadn't performed?

Stesar

eggbox said:

Land Registry Rep
Stesar will hopefully confirm which it was,  however, "The conveyancer acting on behalf of the purchaser, who clearly didn't understand the process, despite being instructed what to do by solicitor, didn't inform the CO holder until a month after completion" reads to me that nothing was done until a month after completion?

I could be wrong but It would be hard to imagine that,  even the poorest performing conveyancer, wouldn't understand that they were certifying to the Land Registry a task that they would , surely, understand that they hadn't performed?

Hi.
Apologies for the delay.

The notification from the buyers conveyancer was received by the CO holder 5 weeks after completion. Subsequently the CO holder has written to both conveyancers claiming negligence by both of them, albeit my conveyancer sent a very short response! The suggestion of negligence by the buyers conveyancer has come from mine. I've seen an email from my conveyancer to theirs clarifying the process of dealing with the restriction in layman's terms because they clearly didn't understand.

The debt is not loan related.

Unfortunately I had no choice but to buy another property, in joint names but with only a 5% deposit and the money is in a joint account. It's a new build house and they don't appear on the land registry for at least 6 months after build, I'm led to believe. I've worked hard to keep off the radar (including avoiding the electoral role) and very few people/ institutions know where I live, but clearly not hard enough!

Also, it's not about avoiding the debt, rather it was about buying some time and having a strong negotiation point. Although, I don't need credit, have a house with no equity and several other debts, so maybe I still have a starting point.

Thanks very much for the help so far.

eggbox

Hi Stesar
Firstly, I might have appeared a bit harsh on you yesterday but it was only frustration through seeing that you'd got the really hard part sorted (finding a solicitor etc) but you then put yourself back under pressure by buying a new house. So you know, any credit your name is on (in this case the mortgage) links you to a multiple of data bases, the easiest of which to search (for your creditor) is your credit file. 

Anyway, what's done is done and you also say the debt is not loan related, therefore, it may be a debt we advise paying on this thread so, on that matter, its probably better left there? Especially, as the, "decent people" comment you received sounds like the debt may be for something owed to a friend or relative? That would certainly explain the statutory demand as, for recent successes on this matter regarding DCA',s, poster's have reported a distinct lack of interest from creditors in even enquiring about payment?

But I'm sure Land Registry Rep would like to know, as would I, when the buyers conveyancer actually certified they had complied with the restriction to the Land Registry? Was it at after notifying the creditor of the sale, as you say, a few weeks after sale; or did they certify before sale despite not having done so?

If it was former then the Land Registry would be at fault, however, if it was the latter then it would be the conveyancers problem and they could certainly be seen as ripe for being sued for compensation, by the creditor, as they would have committed fraud?

Stesar

Hi eggbox

It's not a problem, but thank you for the feedback. As I've said, I knew the debt wasn't going away so I can only hide for so long.

The debt relates to an IP, hence the aggression! The comments are based around using funds that were knowingly not ours to use. Although, as I think I've said there was very little left after expenses.

So, I've downloaded the register from the LR. The title absolute was granted to the purchasers 5 weeks after sale, with the creditor stating they were informed 1 day before the title change. So I'm not sure what that means to be honest, although I suspect it means that they may have complied? However, if there's a gap between application and granting (which I assume there is), then maybe not? Although, my conveyancer is of the opinion that the buyers conveyancer are at fault (and have said that the Creditor will have more joy getting the money from them than me) and are liable for compensation as you've suggested, which leads me to believe that they've certified without notification. 

eggbox

Hi Stesar thanks for the update (but not sure what an IP is as I thought that was Internet Protocol??  )
Its a tricky one because of the current climate? As long as the buyers conveyancer notified the creditor then they have complied with the restriction. However, whether or not, they have commited fraud would be determined by when they they informed the Land Registry of that compliance? Granting the title 5 weeks after the sale, I suspect, means they told the Land Registry after they confrmed to the creditor? But, I suspect, only the Land Registry would be able to verify this as I know there are delays in processing due to covid restrictions and staff working from home? (perhaps Land Registry Rep can investigate  )

Stesar

Hi.
Insolvency Practitioner. They're the people who collect money on behalf of creditors, but always seem to keep the majority of it to cover their own fees.
Thanks again.