A bit of advice on charging order and F&F

charlie84

Hi all, hope this is the right place for some advice.

I have a few charging orders on my property that I am currently paying through my dmp each month. One of them went into Liquidation last year so the liquidators (silke & Co) have been handling the case. Today I recieved a letter from my dmp company with an attachment from the liquidator which they had forward to me to answer a few questions.

Upon reading the letter I got quite angry do called the dmp company to ask for advice which they couldn't give me so I contacted the liquidator to answer the questions direct and to explain the situation correctly to them.

Whilst talking to them I happend to drop into conversation we were thinking about selling our house but could only do this if all 5 co could accept a full and final settlement so we would be free of all co and they wouldn't need to revert abck to unsecured debts.

The liquidator said that it is costing him more money having us on his books so any offer would be considered by his insolvency practitioner.

Now he did say any offer would have to be on a pro rata basis ... what does that mean?

The debt at the time of the charging order stood at £3366 but after court costs were added etc it went up to £3500, once the liquidators took over it some how jumped to £4k and has been like that since. They are currently recieving £3.50 pm set by the judge.

How much would you say is a fair offer for a F&F and do I need to wait till we decided to sell or could I offer them a F&F and pay over 3 months?

He has asked me to call him back in 6 months time to let him know what we intend to do as he would like to go back to court for a higher payment.

bottleofred

Hi Charlie,

The important thing when making a full and final settlement to creditors is to always do it in writing, making the offer as a "full and final settlement" of the debt and to receive in writing an agreement that whatever amount you've offered is as a full and final settlement of that debt. The older the debt, the less you offer as a full and final. If the debt was with a companies in house debt collection department, you'd probably end up paying 75% of the total. However, if it is with another dca and is say 3 years old, you'd probably expect to pay 50% of the debt. My advice would definitely be to start at around 20% (all they can say is no) and see if it is accepted or they make a counter offer of say 60%, at which point you'd then maybe offer 25%. Be sure to get everything in writing before paying any money and keep the letters for 6 years in case someone else comes after you for the debt.

I hope this helps & good luck,

Red

thechippy

Is the house jointly owned, but the debts in one name only??

Sparklyfairy

Good advice above...just wanted to add that by pro rata he probably wants more than the £3.50 pcm, but if you can offer him a full & final offer in cash, I'm sure he'll grab it. As above, just make sure you start low as you can always go up but not down.

Also, as thechippy asked - is the debt solely yours & the house is in joint names? This can make a HUGE difference...

charlie84

Hi, many thanks for replying.

The debt somehow started off in my name but has now ended up in joint names.... I'm not sure what was on the court paperwork (i'm about to dig it all out, once the kids are in bed so can definatly confirm)
The debt was from a private nursery (long story) and it was the managing director that took us to court. It was just a small nursery, no chain or anything and I'm sure it went to court in 2007.

The house in in joint names but two out of the five charging orders we do have are in my husbands sole name.

My husband and I have been talking and we have just over £20K in charging orders as they stand today. We also have just over £40K in unsecured debt, so we thought the best way to tackle the debt was to start with the chargings orders and sell the house. We know we won't get any equity from the house but we would like to pay all 5 off if we can. Best case we can pay them all at the full price if we can get full asking for the property but worst case we would need to offer less.

This nursey (liquidators) are the first charging order so we were thinking of offering them £2200 (debt is £4k) would you advise this or go in with a lower offer first?

I didn't realise about making all offers in writing so will definatly do that.

Sparklyfairy

If a charging order is either in your name or your husband's (not both) on your jointly owned house, then it is a restriction. The paperwork you received from the Land Registry will state on the front if it is a restriction.

Please take a look at this thread here before you make any full & final offers. It explains the difference & could really help you out.

HTH

lvm

I'm not at all clued up on charging orders or anything but definitely don't offer £2200 on a £4k debt. This is a figure you maybe want to end up paying but if you offer it, they will only say "no, we want £3k".

Try starting with £1k and work your way up from there...

charlie84

Lisa - Thanks will start there. The liquidator on the phone did say it is costing them more with us being on their books and paying £3.50 pm so he thinks his insolvency practitioner will accept anything as a f&f otherwise we would be paying this for years and years. So will go and start at £1K.

SparklyFairy - That was a good read and interesting thank you. I am however always confused by the big long words, as embarassing as it is to admit it. Just so I know for definate could you confirm if I have this right:

CO #1 £4k in joint names - private nursery
CO #2 £4980 in hubbys name only for his sole named credit card - Barclaycard
CO #3 £4229 in my name only for my sole credit card - HSBC
CO #4 £3994 in hubbys name only for loan - Blackhorse
CO #5 £2958 in joint names - solicitor

So does that mean when we sell instead of paying all of them from the equity a total of £20161 we would only have to pay the two joint ones giving us a toal of £6958?

what happens to the other ones then? Also I can;t find the land registry forms to find out whats on the front of them. How will I find out this information and if I was to go to the Land registry will I have to pay £4 for each one?

Does all that make sense lol xx

fatbelly

See what's recorded at the Land Registry. You should find 1 & 5 are full charges - they have to be paid in full on the sale of the house.

The others will be restrictions and become unsecured after the house sale - so you can offer F&F on them afterwards - providing you use a solicitor for conveyancing who understands this.

jfwmb88

I'll just jump into it here. I own a credit card linked with Santander, owing £1800. I have been paying minimum payment for a long time now and have not defaulted once. I have already sent one proposal settlement letter (F&F) a while back but received nothing. I offered £1000. I'm currently a mature, full time student and have just enough money put by in order to make the offer again. I don't wish to default but if it makes it more likely they will then accept a F&F I guess I will have to consider it. I have applied for other credit cards in order to transfer the debt where I have asked to transfer almost the full amount, but have been declined.

I would be really thankful for any advice and thank you all for your time! :)

fatbelly

jfwmb88 wrote: »

I'll just jump into it here. I own a credit card linked with Santander, owing £1800. I have been paying minimum payment for a long time now and have not defaulted once. I have already sent one proposal settlement letter (F&F) a while back but received nothing. I offered £1000. I'm currently a mature, full time student and have just enough money put by in order to make the offer again. I don't wish to default but if it makes it more likely they will then accept a F&F I guess I will have to consider it. I have applied for other credit cards in order to transfer the debt where I have asked to transfer almost the full amount, but have been declined.

I would be really thankful for any advice and thank you all for your time! :)

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