Charging Order? The myth

Fatcatdesign

Hi all I am new to this so please be patient....I have a Restriction....being the benefit of an interim charging order registered with land registry....the debt is in my name but the mortgaged property is in joint names. Do I pay back the debt when the house is sold and what does this restrict, as this is a bit confusing on here....any help appreciated

eggbox

Fatcat

Take the time to read through this thread and it will explain your situation.

In simple terms, however, your creditor has obtained a Charging Order against your Beneficial Interest (your part of any equity) in the property you jointly own. He has done this to gain priority on the debt over other creditors and "security" on the debt being repaid as and when your house is sold.

What this thread is explaining, though, is that because you jointly own the property current regulations don't allow your creditor to place an "equitable charge" on your property (similar to a mortgage) and so they are not automatically legally entitled to any money when you sell your house (as they would be with an equitable charge.)

They are only able to place a Restriction on your property (Form K) and this only places an obligation on anyone buying your house to notify the creditor that the house is being sold to allow them to place a claim on any money available.

Fatcatdesign

Thanks for making it more clearer...so am I right in understanding that this is why it is not a final charging order, because the property is in both names?

eggbox

Indirectly, I think it is (but this is an opinion only!)

I feel, in many cases, creditors now are only taking proceedings to the Interim CO stage on jointly owned property as they get the same result (ie a Restriction placed on the Land Registry) as they would with a Final Charging Order but without the added Court costs. I think this is because Charging Orders don't return money in the short term and creditors see it as a way to cut costs given the many thousands that are now being pursued

But, if your creditor does take you to the Final Charging Order stage you will have a Charging Order against YOU. But it will be against your financial interest in the property and not the property itself.

covey

my husbands jointly owned property with his ex-wife has just been sold,there were 4 charging orders on the property in his name. we just assumed they would be paid with his share of the equity,but today received a cheque from the solicitors for the full amount of his share. is this a mistake and now the creditors will come demanding the money we dont know what to do.

eggbox

covey

Do you have any more info on when the CO's were registered against your Husband and did either Solicitor ever mention them during the sale?

Sparklyfairy

Covey..this is my dream scenerio!

Just to add to Egg's questions...were the 4 charging orders for credit cards or loans?

I would call the solicitor & make sure that notice was given to the creditors that the property has now been sold. All that is needed is charging order ref number on a letter to the creditor who has the charge stating that the property has now been sold. That's all.

Assuming the solicitor was/is aware of how the form k restriction works (assuming again these were loan or cc debts) & that notice was given to the creditors, all should be ok & you are free to keep the money. As those debts have already had judgement on them, I would be surprised if judgement could be passed on them again.

covey

I believe they were registered in 2009 and are for credit cards and a loan, the solicitor said there were 4 restrictions on the property and did ask for a copy of the debts which we sent to him. we were under the impression they were going to be paid from his share of the equity which by the way was about 10k short of the total figure owed.
so we were very surprised when a cheque arrived.:j

Sparklyfairy

Wow, great news & it appears your husband's ex picked a knowledgable solicitor! Whhoooo Hoooo there is hope lol!

I believe *SHOULD* any of your dh's creditors start the process again, your defence should be that judgement was already made, form k Restrictions given & the procedure was completed, then I personally believe no more action can be taken. BUT I'm not a solicitor, so best to check with one to be certain.

Well done, btw! x

ldanni1

i dont know whats happened, so im going to start from the beginning. I received a claim form stating that i owed RBS money and that it was going to court. I contacted them and with my parents help offered to pay £2900 as a full and final settlement, unfortunately i fell out with my parents who took there offer with them, so i managed to get £2500 and rang irwin mitchell solicitors up and told them i could only pay £2500, and not what was originally accepted. They told me that they would get in touch with the rbs and see if they would accept my offer. I have telephoned them numerous times asking if they had heard back, nothing, and ive been sitting on £2500, when i am struggling a lot and the money would help alot. Today i have received a judgement thought the door, saying i have to pay the full amount forthwith. I havent a clue what i am supposed to do, are they allowed to just do that when i am wating for a reply when i have offered to pay them. Can i set up a payment plan and who decides how much i pay cause at this moment in time i dont have any expendable money, i am struggling alot, i dont even know if a charge has been put on my house, completely lost and scared would really appreciate if anyone could help xxxxxx