3rd Charge

Readox

Can anyone help?

I have a 3rd charge secured on a property (I am the creditor) - if I wanted to exercise this charge but there was not enough equity in the property - how would I then receive the money that is owed to me?

kingstreet

AFAIK there is no "third charge" only the first charge and multiple second charges. Your charge therefore ranks equally with the other second charge.

If there's insufficient equity to cover the second charges, you either leave your charge in place until there is, or consider legal action to recover your money.

I suggest you consider obtaining legal advice on such a matter.

Senior_Paper_Monitor

You wouldn't !!

Excuse the facetious response but in real terms that is the likely situation.

The debt still exists so you could pursue this through the courts but I guess you will be out of luck there as well.

GMS

Charges rank in order of date registered as far as I know unless there has been an agreement to postpone in favour of a newer charge. Also need to know the terms of the first charge. Could be it encompasses all further borrowings which would knock subsequent charges further away from funds in the event of repo.

If you are 'at the back of the queue' then you should have priced for the risk accordingly. If you are not settled as a secured creditor then you would need to pursue it as an unsecured creditor with bankruptcy the ultimate recourse. However if there are no assets to chase for then this may prove a waste of time.

Get some good legal advice asap

Thrugelmir

Who is second charge? Did the lender agree to the charge being placed on the property?

holly_hobby

To exercise a possession order under your charge (i.e forced sale), will have to be awarded by the Judge when/if you take this to court under non-payment, and depending upon the circs/their defence of your demand, this may not be awarded in your favour in any event.

Further to which, all preceeding chargees will have their os debts settled prior to yourself - which being 3rd in line (under the standard charging order list of registration), may not provide you with the funds you are obviously hoping for from the action.

If you are having payment issues with your debtor talk to them, as I am sure that they, as you, would wish to avoid such drastic action if at all possible.

Hope this helps

Holly

kingstreet

Thanks folks. I didn't know second charges ranked in date order.