Charging Order? The myth

brightonian

Thanks for the advice Eggbox. Ironically I have sent the previous post by LRR to my solicitor, but she cannot get the LR to say the same to her via its advisory service, as she can't/won't give an undertaking to the buyers solicitors without a named person within the LR advising "this is usually the case".

I am thinking of sending the below message to LR via their "Contact Us" service. Do you think I will be fobbed off with the "we can't advise"? I have tried to make it non specific and use words like "straightforward" and "usually". Or am I wasting my time?

I have been advised to read Practice Guide 76 regarding a Form K restriction.

Section 5, Para 3 particularly:

"Accordingly, a Form K restriction will be usually be cancelled automatically, without application, when a transfer which appears to overreach the beneficial interests is registered."

Would the straightforward sale of a property by two proprietors for value to an unconnected third party be a situation where you would *usually* expect the Form K restriction to be overreached upon registration by the new owner?

eggbox

Your Solicitor should only need to refer to the Land Registry's own Practice Guide highlighted to be confident of the assurance to be given as it explains in black and white what the implications are for the Restriction in these circumstances.

Sadly, despite you paying them for their services Solicitors aren't the most helpful in these matters as a lot refuse to accept completing the transaction without paying off the CO behind the Restriction. This is even though there is no legal obligation to do so and they are supposed to be acting in YOUR best interests.

Puablo

My Mum has the property,

eggbox

You should get her to apply to the Land Registry to have the Restriction removed as it was a) made in error against the interest of a person unrelated to the debt and b) would now be overeached in any event as the interest it was against no longer exists

eggbox

Puablo - can I just ask if there is any chance your parents were guarantors for your loan?

brightonian

I will draft an e-mail to solicitor tomorrow Eggbox, but I fear time is running out - mainly because she accepts it can be overreached, but only by a third party initiated sale, ie repossession.

eggbox

Brightonian

I'm afraid to say that your Solicitor isn't really up to the job if that is all she can understand regarding how overreaching works. Perhaps it may be better to move your business elsewhere as she is certainly not looking after your interests and seems poorly qualified for the job given what you say she has stated about overreaching?

Land Registry Rep has explained how and why overreaching occurs when a sale is made for valuable consideration by joint owners to a third party. It has nothing to do with any repossesion occuring.

Also, if you read post #460 of this thread I inserted the correspondence I had with a Solicitor from the Land registry explaining in print what "usually" happens when a sale is made to a third party for value (and PM me your email if your Solicitor wants a copy.) Land Registry Rep has also explained on this thread why the LR have to use phrases such as "Usually" and "May" when expalining the LR rules as it prevents them being seen as giving advice on a legal matter (and it amazes me a Solicitor doesn't understand that aspect?) Your Solicitor seems to be looking for the LR to give her assurances when the assurances she requires are already there in black and white in the LR's own Practice Guides?

As I said, and with £16k at stake, it may be better to look elsewhere for a conveyancer that understands a little more than your present one does?

brightonian

Thanks again for your help Eggbox, I have PMed you.

I have e-mailed my solicitor in the meantime, pointing at Practice Guide 76 and also this document from BLL Law which I am sure has been posted before, but as it's from another solicitor, hopefully it adds something to my case.

Four days left until completion. Gulp.

eggbox

Hi Brightonian

I have PM'd you but just to further say I don't think the LR did give dodgy info to your Solicitor I think it was what she was asking (ie; asking how a Restriction is removed prior to a sale)

If she gets her head around what a Form K states and marries that up with Practice Guide 76 I think (hope!) the penny will drop!

So good luck and please keep the thread informed as ALL info (good and bad) helps!

Stuckneedhelp

Hi,

I was pointed towards this thread after posting on the main forum page earlier today and need some Help / Advice!

I have just returned home from an Interim Charging Order hearing where the judge has granted a Full Charging Order to the claimants.

A brief background:

I bought 2 investment properties in 2007. Within months of purchase the area had become a 'no-go zone'. Due to a local gang all the houses and flats within a 3 road radius were boarded up. I had my places set fire to on numerous occasions and there was constant vandalism, so I quickly got mine boarded up too. I maintained mortgage payments on both properties until 2010, when the monthly costs plus service charges etc. became too much so I stopped paying.

During this time and after I continued to try to negotiate a deal with the lenders, but each deal required the sale of the properties, which were un-sellable. Incidentally, the debt on each property has been sold on 4 times from the original lenders, so I am now dealing with 2 companies who purchased the debts nearly 3 years ago.

To cut a long story short both houses were repossessed and subsequently sold for £20k each, and both lenders have been chasing me for the balance. I owe about £100k to each one.

One of the lenders has agreed a settlement figure which is both feasible and acceptable to me.

The other lender has obtained a CCJ and proceeded to obtain a charging order on the only other property I own. It used to be my main residence and is owned jointly with my wife. We vacated this property a couple of years ago and rented it out to help pay the bills. There is maybe £50k equity in this property.

I made an application to have the original CCJ set aside last year, on the grounds that the claimants had been sending all documentation to the wrong address. However, the hearing was moved from a court in London to Liverpool, and I requested that it be moved back to London. I did not hear anything about my application after that, though today I was told that a hearing went ahead in Liverpool in January and the motion to set aside the judgement was dismissed. At the same time, the court supposedly granted the claimants an interim charging order on my other property, though the judge today said the paperwork from Liverpool is so awful it is hard to determine when exactly the ICO was granted.

I received in April a letter from the lenders solicitor 'enclosing service upon you a sealed copy of the interim charging Order' with a returnable date to a court in Liverpool.

I immediately wrote back explaining that I intended to contest the ICO and to move the hearing to my local court, which they duly did and the hearing was today.

So, I went to the ICO hearing today, where the judge told me:

- He was granting a Full Charging order. I thought that after the ICO hearing there would be another 28 days and then an FCO hearing, but the judge said this was not the case?

- He said that the claimant can force me to sell the property. I thought that they could only have a restriction on the property and not force me to sell?

- That it would not be worth my while going back to my request to have the original CCJ set aside, despite the fact that I was never informed about the hearing and that he thought the paperwork from the county court in Liverpool was in a dreadful state (lots of hand written notes and missing information / documents contradicting themselves).

- That the interest costs on my debt will amount £763 per year.

- That despite the fact that there is minimal equity in the property, and despite the fact that it may prejudice the other lender who I owe a similar amount to, that he could see no reason to deny granting the FCO.

Is the above all correct? Where do I go from here? I have been making offers to the lender but all have been refused. What are they likely to do now? The charging order doesn't really help them get their money back any time soon as there is not enough equity.

I don't know what to do. I have no other assets that they can come after, but I do have a decent job.

Any / all thoughts appreciated.

thanks