Charging Order help?

two5oh

Hello everyone, first of all apologies for this topic coming up again. I have searched the forums and can see it is a regular feature around here, but I could not find a similar case to my own so felt the need to create a new thread.

My partner and I have recently finalised a mortgage and moved into our home. We have both had problems with debt in the past but this has all been paid off apart from one of my partners CCJ's, which came about due to none payment of water bills. The CCJ was from 2007 and is for approx £900. We have now both received a B136(CO) form through the post from the Land Registry and are unsure what to do next. The debt was from another property but the proposed charge is for our current one. I will be contacting my solicitor tomorrow but would like a few other opinions before deciding how to proceed!

Also our house has been split 70/30 with myself receiving the smaller portion due to an agreement between ourselves at the time of purchase. If possible we would like the Charge (or similar) to appear only on the larger share as the debt was my partner's from before we met. I have read in another thread of a Restriction rather than a charge? Would this be an option for us?

Any help is GREATLY appreciated as we have absolutely no experience with this. Any more information you require please ask!

Thanks in advance.

Tixy

Hi

As your property is jointly owned then they could not get a full charging order - it could only ever be a restriction.

But given the small value of the debt and that it is only in his name I would think you would stand a reasonable chance of defending against a charging order (restriction).
Is he currently making any payments towards this CCJ?

If you haven't alreasdy seen this factsheet its worth a look - http://www.nationaldebtline.co.uk/england_wales/factsheet.php?page=15_charging_orders_in_the_county_court

pete1968_2

The B136(CO) notice will be in respect of a restriction being entered on the register of your property. It basically protects the money owed to the water company.

Land Registry are obliged to enter the restriction, you don't normally have any grounds to object even if you've paid it. If it doesn't affect or has been paid recently then you will have to approach the applicant of the restriction and ask them to cancel the restriction.

The restriction will not stop you from selling your property, but the wording of the restriction will probably say that a certificate will need to be provided should you wish to sell confirming that the water board have been informed so that a proportion of the proceeds of sale can be sent to the water company by your solicitor before the remainder (if any) is sent to you.

The B136(CO) should give the reasons for the notice and provide you with the details of the applicant so you can contact them directly.

As your property appears to be in joint names, they will not be able to register the charge as it only affects you partners beneficial interest. How the 'shares' in the property are distributed will not be a concern of the Land Registry nor will this be reflected on the register (except for a form A restriction - google it!). The water company will only be interested in whats owed to them.

Is the charging order an interim one or final one? If its an interim one then you may still have time to pay the debt off before the court makes it absolute.

two5oh

Hi, thank you both for your replies, and my apologies for the delay in getting back to you!

Pete1968 is correct, the notice is of a restriction against the land, although 'charging order' is mentioned several times in the letters we have received. Basically they are asking us to either consent or dispute the order, both sign and date and return within the next 2 weeks. My partner has tried to speak to the water company and set up a payment scheme but they have told her that we need to wait until the order has gone through before we can do so.

There is no mention of whether this is interim or final, other than explaining the difference between the two. I honestly do not know which it is. Unfortunately for us we do not have the funds available at the minute to pay this debt off in full, and the water board are currently unwilling to negotiate a payment plan. Should we consent to the restriction and pay it off asap? Or should I/we fight and hope for the best? Also if we did choose to dispute what grounds could we use? If we did consent what difference would it make to our situation? (i.e. could they force us to sell, would it affect credit history or re-mortgage applications)

Thank you once again for your help!

chanz4

if he has a ccj its already effected the credit history

two5oh

chanz4 wrote: »

if he has a ccj its already effected the credit history

(She) has had her credit affected, yes, I have not. My concern is that when we come to re-mortgage for a better deal if a restriction will cause any difficulties?

Angry_Bear

You should maybe ask this on the mortgages forum, it is my understanding that a remortgage is effectively selling the house and using the money to rebuy it off a new lender iykwim.
It's possible that you won't be able to remortgage at all with a restriction - no idea if this would be the case but worth checking I'd have thought.

Sparklyfairy

If I were you, I'd really focus on paying off the £900 (which is rather small amount tbh) & asking the water company to mark your ccj on your credit file as "satisfied." That way it will give you a much better chance of being taken seriously by a mortgage provider & you want to show them you two are responsible & pay your debts (obviously). As banks are now notoriously harsh on giving out money, I'd sort it asap..

two5oh

Although the debt is small in comparison to the value of our house, it is way above any amount we would have to offer within the 2 week deadline we have been given to reply, and as previously stated the water board are unwilling to negotiate until the restriction has been granted. My main concern right now is not paying the debt off (of course we will do so as soon as we are able) rather how to proceed with the restriction order. I think its fair to say my partner has little option, but do I consent or dispute the case?

Sparklyfairy

I think it's too late to dispute it, your other half already has a ccj for this debt & the water co is within their rights to go ahead & get a co/restriction.

My point in my last post to you was to PAY OFF the £900 debt before asking for a mortgage (not necessarily within the 2 week period before a co gets logged), otherwise you most definitely won't get a mortgage approved. The defaults & the ccj are the "punishment" for the debtor, their credit record gets marked & the co/restriction "secures" the creditors money. Since you said the water co debt is in your partner's name only & the house is in joint names, you have a restriction. If you plan on moving & you still have this restriction on your property, find a solicitor to help you with your move (many are completely unaware that it's not unlawful not to pay a restriction - so this is imparative). Otherwise the restriction just sits there (like a mortgage) & if your other half is continuing the ccj payments, the debt amount should be going down & once it's paid, you can ask the water co to remove the restriction through the Land Registry.