Charging order hearing this Friday

alias07

Hi, I'm hoping someone can give me some advice please. My husband has had no work (normally contracts) for a while, although there is one contract with a large company almost ready to go (mind you it has been for a long while - it's moving very slowly). I am in full time work; however we have a lot of debt (stupidly) and have not been able to afford our payments for a few months. We sent letters a few months ago, with a statement of affairs and offering a token payment of £1 until circumstances improve. Almost all the companies accepted this (with regular reviews). We have an agreement with our mortgage company to pay a little extra each month to catch up on arrears and a secured loan that we are up to date with. There is possibly £10,000 equity in our house - but that does not cover the amount of the secured loan.

Northern Rock have never accepted the £1 token payment (although we have sent cheques that they cashed, and now pay by standing order each month). When they threatened to take us to court we got advice, and were told to re-send our letter and statement of affairs, and were told even if it did go to court , the court would not make us pay more than we could afford. Suffice to say, we were sent a letter asking for £200 more per month than the original monthly loan payment! We sent an official court form challenging this and then received a temporary charging order with a date for the hearing in London. I sent a letter back saying I wished to attend and contest this but nearer to home. Since then my husband's contract has come nearer to fruition, but still not quite there. In a stupid head in the sand way, I was hoping the contract would commence before a new court hearing date arrived, and we could try and make an agreement with Northern Rock to clear the arrears over the next few months. Anyway, the new date arrived on Tuesday and is set for a week on Friday. And of course the contract still does not have the start date officially set!

So, we are not in a position to afford legal representation, and I really need some sound legal advice rather quickly in order to try to stop this charging order going ahead. I know this is really late in the day, it was pretty stupid hoping that the cash flow would improve rather than arming ourselves ready for the worst case scenario.

With thanks
ali

Sparklyfairy

Hi there, fighting against a charging order is nigh on impossible - district judges seem to take the view that if you owe say £10k & will only pay £1 pcm - it'll take 10,000 months to clear the debt - hence the charging order will be granted. I tried to fight against mine, tried every thing I could possibly try, but mine was still granted. One thing for certain - take 3 copies of your current income & expenditure forms (1 for dj, 1 for creditor's solicitor & 1 for you) & explain your financial situation as it stands NOW - not next week when this job may/may not come to fruition. I say this because you really need to err on the side of caution when it comes to your repayments through the courts & it's definitely best not to mention this possibility of this extra money at this time as the dj will expect you to pay it off or more than you can afford should you NOT get the money when expected. Please bear in mind that although you may have a charging order granted - you can always do a full & final offer to your creditor at a later date should you come into some money & want it cleared - and this can be 80%/75% etc off your total amount owed.

Can you clarify is the debt to NR is a loan or a credit card? Also, is this debt in your name or your husband's name only? Is your house jointly owned? Not being nosey - I just want to see if I can help you out a little bit more...XX

alias07

Hi Sparklyfairy, thanks for the advice. The charging order is for a Northern Rock loan in my name only, but it's a big one. Our house is owned jointly, although there's not enough in it to pay off both the mortgage and current secured loan if we were to sell, let alone pay off Northern Rock. I'm hoping that this means there's no chance that they will try to force us to sell if the charging order does go through (as I now know it very likely will).

What is the process at court, if you don't mind me asking? I have no idea what to expect and I'm dreading it.
Thanks again x

Sparklyfairy

Ok, not to worry at all - get a cuppa & have a read here. Basically what you'll get is a Restriction & this link explains the difference between a charging order & a restriction. Read it & read it again, then get your other half to read it as well because basically what it boils down to is that they aren't worth the paper they are written on!

When you're at court (was it transferred to your local one btw? If not, I'd call the court holding the hearing & see about getting it moved to your local one..) it's all very informal. We were met by our creditors solicitor who was actually quite nice (but always remember they are working for your creditor at the end of the day!) Then we were called in to the court room which was just an office with a rather large desk with the dj at the top, we were on the right side & the solicitor was on the left. They heard our arguments against it, they heard the sols side for it we pleaded for them to add a stipulation that no further action would be taken which my dj DENIED us(!) BUT, we have been granted paying them only £1 pcm & they have their restriction, er charging order

Also, it's worth pointing out that there are 4 points where I believe, at a later date (a seperate court date, not this one on Fri so don't worry), a judge would NOT agree to NR selling your home because:

1. You don't have enough equity to cover the loan with your share of the equity & that would be part of your defence.
2. It's very rare for a judge to grant orders of sale - from what I've read from people who work in the courts only a handful of people have had this happen to them based on them blatantly avoiding any type of payment.
3. If you have young children, courts will NOT grant an order of sale. If you do, it would be something to mention to the courts so that fact feeds back to the creditor..
4. If you or someone in your family is very ill, the courts also don't like to grant an order of sale for the same points as above.

I know exactly how you're feeling, but try not to worry too much. I hope things go as well as expected & if you do end up with the dreaded co - it literally just sits there & once it was granted I haven't heard from my creditor's solicitor at all..

Please keep us updated with what happens on Friday if you can, ok? xx

alias07

Sparklyfairy, I have read through it all twice now, and a big, big thank you for taking such a weight off my mind. I can't believe people are made to believe that charging orders are being applied when they are not. And so few people seem to know.

I had already asked for the hearing to be moved closer - so yes it will be a local court. A big thank you too for explaining what will happen when I attend - must admit I had vague notions of standing up in a huge courtroom! Very glad it's a lot more informal than that. So, I will take 3 copies of my statement of affairs and earnings, argue against the CO due to there not being enough equity in the house to pay them anyway, and I'm hoping the monthly payment will remain the same. Sounds simple though I suspect my knees may be knocking a little bit! But a LOT less than before I read your post.

Thank you so much
Ali x

Sparklyfairy

I'm so glad my posts helped! Seriously, if I knew then what I know now - I would not have been nearly as stressed as I was! Take things easy - fight your corner & don't lose sleep over it - it's just not worth it! X

dancingfairy

Have a look on National Debtline's website for their factsheet on Charging Orders. This should put your mind at rest. Seriously charging orders/restrictions are thrown around like confetti - sooooo many people must have them. It comes up on here fairly often and I have to say I have never heard of a forced sale. Like the other poster said it just sits there, the creditors are content to wait knowing they will get their money back eventually.
Oh also in case you didn't pick it up the OP was using DJ which stands for District Judge. It is very likely to be a small room with a table in it, you, the judge (who probably won't even bother wearing a wig etc), and probably a solicitor from the other side.
It will be heard in your local County Court - this is where things like bankruptcy, legal disputes, divorces, etc are dealt with. It is not the Crown Court which you see on the tv where murder trials etc take place.
I feel it will probably be a complete anti-climax for you! Lol - they are really not that interesting places. I agree with the other poster in that it is highly likely that you will not be able to prevent the charging order/restriction but it is worth a shot.
Best of Luck
df

alias07

Thank you both Sparkly and Dancingfairy! Don't know about fairies but you're both definitely angels! I do feel so much better for your posts. Have to admit I was a bit of a wreck for a while there. I'm going to look on the National Debtline site now, and arm myself with a little more information.

I will let you know how Friday goes!
Thanks again,
Ali x

alias07

Just a quick question before my court hearing tomorrow! I was wondering if I could use as part of my argument against the charging order (restriction) that the CCJ I received was unreasonable and not accepted? It was £200 higher per month than the original agreed repayments on the loan. When I received it I phoned the court and got them to send me form N244 to appeal against it. The next letter I got was the interim charging order, therefore surely the solicitors skipped some steps and I did not strictly miss any payments as they were still in dispute. Is this worth a shot? May as well make an effort to fight it, but I don't want to irritate the DJ.

Thanks

chanz4

they will say you should of persued it, the debt company must not trust you will make the payments

alias07

Not sure I'm following you there - the reason they went for a CCJ initially was because I couldn't pay their monthly payments and had offered £1 per month temporarily, until my husband found a new contract. So I definitely wasn't going to manage to pay £200 per month more than the payment I couldn't afford! What I was asking was if it was worth arguing in court tomorrow morning, that they had gone for a payment that I couldn't possibly pay, thereby had acted in an unreasonable manner. In the vain hope that the DJ may not grant the charging order.