Charging Order? The myth

Land_Registry

jmsc3511 said:

Hello. I have 2 Form K restrictions for a sole debt on a jointly owned property and am in the process of selling the property. I've been following this forum for many years and understand that they are restrictions and not notices and that the requirement is for the buyers solicitor to provide a certificate to Land Registry at the point of registering the title into the new owners name. The certificate should state that they've notified the creditors of the sale. I'm working with my conveyancing solicitor who seems open to me explaining what a Form K restriction is and I'm hoping that he'll be able to explain things to my buyers solicitor. My question is what is the process for the buyers solicitor? When registering the property in the new owners name do they only need to provide the certificate and that is enough? Is there any requirement for them to provide an RX3 or RX4 form at that point?
Thank you. 

Yes. Just the certificate. No RX3 or RX4. The restriction tells you what’s required, namely a certificate signed by the applicant for registration or their conveyancer

jmsc3511

Thank you LRR.

I'll update the forum as to how I get on.

jmsc3511

Hi again. Can my solicitor give notice of the disposition to the creditors, and prepare a certificate to then be signed by the applicants conveyancer to be submitted at the point of registration? Does that comply with the terms of the restriction?

Land_Registry

jmsc3511 said:

Hi again. Can my solicitor give notice of the disposition to the creditors, and prepare a certificate to then be signed by the applicants conveyancer to be submitted at the point of registration? Does that comply with the terms of the restriction?

We need a certificate from the conveyancer or applicant as explained. How you get them to do that is a matter for them/You to agree upon. 

jmsc3511

Land_Registry said:

jmsc3511 said:

Hi again. Can my solicitor give notice of the disposition to the creditors, and prepare a certificate to then be signed by the applicants conveyancer to be submitted at the point of registration? Does that comply with the terms of the restriction?

We need a certificate from the conveyancer or applicant as explained. How you get them to do that is a matter for them/You to agree upon. 

Thank you again 

psykix

I have a quick question (hopefully!)

I have an equitable charge on my property from 2007 for Kings Hill No.1 who seem to no longer exist according to Companies House?

My mortgage is due to finish in the next 14 months. The property is in my sole name, but I’m married and we have 2 disabled children.

Is anything likely to happen re: the charging order once the mortgage is paid off?

I wanted to put the property into joint ownership once the mortgage was paid also - will this be possible whilst the CO is in place?

Thanks for all your sage advice on this thread!

Land_Registry

psykix said:

I have a quick question (hopefully!)

I have an equitable charge on my property from 2007 for Kings Hill No.1 who seem to no longer exist according to Companies House?

My mortgage is due to finish in the next 14 months. The property is in my sole name, but I’m married and we have 2 disabled children.

Is anything likely to happen re: the charging order once the mortgage is paid off?

I wanted to put the property into joint ownership once the mortgage was paid also - will this be possible whilst the CO is in place?

Thanks for all your sage advice on this thread!

I can only advise on the emboldened Q - the equitable charge won’t stop you transferring the property to yourself and your wife. The equitable charge will simply remain on the register 

Victorlab22

Hi, looking for some advice. We’re in the process of buying our first house. The register has the following restriction on it (confidential info redacted):

RESTRICTION: No disposition of the registered estate,other than a disposition by the proprietor of any registered charge registered before the entry of this restriction, is to be registered without a certificate signed by the applicant for registration or their conveyancer that written notice of the disposition was given to XX Mortgages Limited (Co. Regn. No.) and care of XX MX LLP, being the person with the benefit of an interim charging order on the beneficial interest of Mr John Doe made by the Manchester County Court on 8 July 2014 (Court reference xx).

Our solicitor has advised that this can be removed from the register once the sale is complete and that they have the evidence to demonstrate that this restriction has been complied with. Is it that simple and will we have any issues being registered as the new owners when we buy the property? Will our mortgage company refuse to lend us the money? We’re a bit apprehensive as this seems risky.  

Thanks, V 

eggbox

Hi, for once you have a solicitor giving the correct advice. If you want to understand why your solicitor is correct you can read a bit more of this thread, however, in short a Fork K Restriction (as you have) gives poor security to the creditor concerned. This is because, as your solicitor has advised, in order for the property to be transferred to another person, all that has to happen is for theRestriction terms to be complied with. In your case, its that the creditor is notified a sale of the property is happening, followed by the Land Registry being notifed the creditor notification has occured. 

Once the above notifications have occured, the property can be transferred into your names. Its important to understand, however, that complying with the Restriction doesn't remove the Restriction from the property deeds. Its only when your names are registered as new owners that the Restriction becomes "overreached" that the removal of the Restriction is automatically cancelled by the Land Registry. 

Its also important to understand that your mortgage company may not agree to the above process as you will get some dullard telling you they want the Restriction removed prior to the sale proceeding. Technically, the above process doesn't do that. However, if you solicitor is worth his fee he should be able to explain the above to the mortgage company if they do object to anything.

Dazza333

Ok help. Recently widowed and long story but having to sell our home. I have three K restrictions on the land registry from over 7 years ago. In my name. House was joint owned with joint mortgage. I am sole beneficiary. The payment of these will leave me with zero funds after mortgage repaid etc. so…. Big question after reading through all the thread and getting a headache. Best way to move forward? Can I get away with not paying them? (Regardless of ethics etc need some income to rent). Been a carer for my wife for 5 years prior to her passing. A total mess of failed life insurance does not help. Help!