Charge on the house

FBaby

Not sure this is the best place for this thread but don't know where else to post.

Here's the situation: Partner and I separated in 2004. We both co-owned our house. He accumulated a lot of credit cards debts, and companies started to go after him when he was made redundant. Unbeknown to me, one was threatening to put a charge on our house even thought the loan was unprotected. During this time, we had agreed that he would sign the house over and I was waiting for my mortgage lender to agree. I finally did found out about the threat and tried to negociate myself with them. My solicitor wrote to them and offered for me to pay half of the debt is a lump sum for them not to put a charge on the house. They refused. Next thing I knew, they took my ex to court (he didn't go) and the judge agreed to the charge.

At the time, under a lot of stress and just desperate to get the house under my name to avoid more debtors trying to put a charge on the house, I didn't question it. Thankfully, I did manage to get the house under my name and I tried to put it all behind me.

Recently though I've started wondering whether all this might have been done illegally. To start with, my ex has said that he was trying to get the loan cancelled on the basis that they shouldn't have gone for the house as the loan was unsecured. I am not getting much information from him so don't know the details, but my gut feeling is that he is dreaming if he thinks this will happen. However, could I have a case on the basis that:
1- they put a charge on the house which I then co-owned, yet I wasn't summoned to court and therefore didn't get a chance to defend myself in front of the judge and,
2- If I had been able to go to court and explained to the judge that I did try to compromise by offering to pay half the debt, the judge might have ruled differently. I have read somewhere recently that although companies found a loophole allowing them to go after homes even when the loan was unsecured, they HAD to accept reasonable offers to pay the loan, and I would have thought offering to pay half in one go could have be deemed reasonable (I even think after they turned it once, we agreed to pay more, but still it was turned down).

I am considering going to a sollicitor to look into this case, but don't have much disposable income so want to get an idea first of whether it is even worth contemplating.

jonesMUFCforever

Any unsecured debt can be made secured by what you have described ie a charging order.

What I am not sure about is whether if you as joint tenant would have had to be a party to the debt for it to be enforceable against the property.

I think you need to seek legal advice if you never want to move then it should not be an issue but if you do or want to re-mortgage etc then it might well get messy.

mjm3346

To start with, my ex has said that he was trying to get the loan cancelled on the basis that they shouldn't have gone for the house as the loan was unsecured

The point of a charging order is to make an unsecured loan secure (although there is no backdated reduction in interest rate to reflect the fact the loan is now secured so they can have their cake and eat it), if there is enough equity in the house why would they want to accept anything less than full settlement? If the debt was incurred while you were still together then the arguement will be that you benefited from the extra household income.
It might be worth contacting one of the debt charities for advice unless you can get a solicitor for free.

FBaby

mjm3346 wrote: »

The point of a charging order is to make an unsecured loan secure (although there is no backdated reduction in interest rate to reflect the fact the loan is now secured so they can have their cake and eat it), if there is enough equity in the house why would they want to accept anything less than full settlement? If the debt was incurred while you were still together then the arguement will be that you benefited from the extra household income.
It might be worth contacting one of the debt charities for advice unless you can get a solicitor for free.

I read somewhere some times ago (here I think!) that before imposing a charge on a house, companies needed to show to the judge that they had considered some kind of settlement or arrangement, including reduction of the debt. The thing is, my ex didn't show up to court, so I can imagine the judge ruled against us purely on the basis that we were not there to defend ourselves....but then I was never invited to do so and that is what I would use as an argument.

As for the fact that I benefited from the extra household income, that was actually the main reason for the separation, most of his income went into paying the mininum repayment for all his debts (they had nothing to do with me whatsoever which he has always acknowledged), so I was already paying just about everything myself.

Thank you for your advice, i think I will try with CAB and see how it goes.