"Unfair" Charging Order

script

I would be so grateful if someone could explain this to me.

A creditor goes to court to get a CCJ – and you are perfectly willing to pay whatever the court was to agree.

But before you get the chance - the creditor applies for a charging order on your house and the courts allows it.

I think the creditor applies for a CCJ and a charging order at the same time.

What is the actual process the creditor uses to do this?

And how can you stop them from doing it?


Let’s say a creditor manages to do this in Aug 09 – making them a secured creditor. And you are paying the agreed CCJ payment that the court makes.

Because of mounting other debts you petition for B/R in say Oct 09.

And you explain to the Examiner you were paying the CCJ agreed amount – can (and I’m guessing it’s highly unlikely) the OR overturn the CCJ and make that creditor unsecured?

Because the creditor gave themselves “preference” above all the other unsecured creditors.


By the way lets say the house does have equity – but you have someone that will buy the beneficial interest.

debt_doctor

Hi,

I m sorry but courts up and down the land allow that abuse of process, I have a particular fight at the moment for a client.

If a charging order becomes final before BR ( or at any other time) then it is a secured debt and outside of BR.

DD

script

Thanks Debt, I have heard that the problem is widespread.

And unbelievably the courts allow it.

Am I right in thinking that it is up to a Judge - and if you attend or contact the court you can try and persuade him/her not to grant the charging order?

Also does it tend to be companies who "bought" the debt that try this CCJ/ Immediate Charging order process - rather than the original creditor?

Feelingfoolish_3

Hi
To stick my nose in - you can attend court and try to persuade the judge (and we often put in submissions but in this day and age unless there is a point of law that can be challenged, we ask for conditions to be attached to the CO) however it is often a futile process...... unless you have a point of law which can challenge the CO

In my experience it is the original creditor who often gets the CO

To play devils advocate - people are equity rich but offering a token gesture to the ccj, cant blame the creditors when a CO is at their disposal

script

Thanks FF,

I can understand your point about "token" CCJ payments.

I think the most unfair thing about CCJ/Immediate charging orders is -

Previously if someone paid the agreed CCJ amount (and lets say it was a genuine figure that was affordable) - then the creditor could not take any further action.

By the way - could the creditor with a CCJ and Immediate charging order - use the "charge" to repossess the house?

sportie

Am I undestanding this correctly? If a charging order is placed on your house and you declare yourself bankrupt, this debt is not included?

What if the company has advised you that they want to put a charging order on the house, can you still go bankrupt prior to this being finalised and for this debt to be included?

Feelingfoolish_3

Script - yeah it is unfair the way the 'rules' seem to be changing! And once a charge is in place then the creditor can enforce by an order for sale - seems to be rare but who knows in this day and age

Sportie - that is correct once a charge is in place then it cant be included in BR, if you go BR before a final charge then the debt should be included in BR unless the BR is suspicious that you only went BR to avoid it