Charging order on house - how will this affect the sale?

Jeanthelibraryqueen_2

My husband and I are in the process of buying a house, but a problem has arisen. The vendors are a married couple (the house is owned jointly), and, as well as a mortgage, there is a charging order on the house due to his business debts (we don't know how much for). My understanding is that if the house is sold, the mortgage company will take all the money from the sale, leaving nothing for the creditor who has the charging order.
The vendors are keen to sell to us, however the second creditor who has the charging order is refusing to allow the sale unless they are paid in full.
Can they do this?
We'd really appreciate some advice with this! Thanks!

nifferwilko

I think your solicitor would make sure that all charges are settled before the house is sold (as otherwise you'd become liable for the charge, which is not in your best interests)

At least I think that's right

Richard_Webster

Your solr can't allow the purchase to proceed unless both the mortgage and the charging order are removed so the seller may simply have to withdraw from the sale if he can't arrange this.

If the market is still rising in your area he might be able to find another buyer who will pay enough to cover both.

Sometimes a first mortgage lender might be persuaded to take a little less to enable the sale to proceed but only if they were pretty sure that if they didn't they would have to repossess and then would be much worse off. It will depend upon the precise figures here, and there is no reason why they should agree to this.

The people with the charging order might be persuaded to take less, particularly if they thought the market was going to take a downturn.

Your solr will need to ask the seller's solrs what they can do about it but unless they really think there is some reason for one or the other to accept less than their due, the sale is going nowhere and you will simply have to find another house to buy.

As a conveyancing solicitor I believe the information given in the post to be useful but I accept no liability except to fee-paying clients.

papermoney

Are the vendors buying another property they can transfer the left over amount to?

We had this as we had a second charge on the house, the company we took the second charge with were happy for us to transfer the amount to the new property.

(however we didn't do this)