Urgent Advice needed regarding Voluntary Charge on property

dichmau5

Hi all,
I hoping someone could perhaps help me, ive left something until last minute and hit panic mode!

I had to use a family solicitor following my divorce to fight my ex regarding the welfare of my children.

To cut a long story short, the bill mounted up excessively and i struggled to pay. I have paid big chunks through out but still over £2300 (Ive paid around £3000). I had issues with the solicitor and her charges and way she built up charges.

The refused to accept an offer of £50 per month towards the debt and demanded £250. I cant afford this and my debt management company (using since my divorce as my ex left me lots of debt that i am 1 year away from clearing!) wrote to them with an I & E.

I wrote a complaint letter and they have now agreed to accept £50 per month providing i agree to a voluntary charging order on my property. This is what they have said:

"We can agree on a without prejudice basis to accept payment of £50 a month towards your outstanding debt, and to waive the interest we are entitled to charge under our Terms and Conditions, if you agree to a voluntarily charge on your property to secure the debt. This offer is open for acceptance within the next 7 days and if we cannot come to a more realistic arrangement in relation to payment of our fees we will commence court proceedings and seek a charging order to secure any judgement obtained."

All my research says don't do it! But i don't fully understand the ramifications of this.

Can any one help? Offer any advice? Whether this is the right course of action to agree to?

Any help appreciated.

Thanks

Dichmau5

Thrugelmir

The solicitors are looking to guarantee repayment of the debt with a charge on your property. Should you wish to sell your property then the charge will be need to settled. If the debt has not already been repaid previously.

dichmau5

Hi,
Thanks for your information.

There are a few things i was worried about:

1) Can they then force me to sell my house? (even if i keep up with repayments)
2) will it being there affect my chances of a remortgage

I have had 5 years of struggling after divorce and am clear in 2014, i desperately want to move/remortgage and didnt want anything else to hold me back :O(

Thanks again for your advice.

Thrugelmir

dichmau5 wrote: »

1) Can they then force me to sell my house? (even if i keep up with repayments)
2) will it being there affect my chances of a remortgage

1) If you defaulted potentially yes. Though unlikely. As to do so would be an expensive option.

2) Being in a Debt Management plan will scupper any chances of a remortgage with a new lender.

dichmau5

Thanks again, so it would show then on a credit check?

I already have something on the property and im not sure if its the same only its not a debt (as such). When i got divorced i got legal aid and because i kept the house it was deemed i benefited and so the legal aid amount was attached to the property and if i sell it gets paid off first. (The same solicitors did this, so they know!).

So i shouldnt worry unduly about agreeing to it?

I wondered if it was a bullying tactic? Which they have done a lot. And if i refused they would still accept the £50 anyway? Like i say ive never not paid monthly (and paid lump sums when i can).

Sorry for bombarding you with all these questions, everything i find online is suggesting avoid at all costs as you lose your house and equity etc as they are all about larger amounts.

DM

Thrugelmir

This won't appear on a credit check.

Purely my personal view. As they've offered to accept £50 per month and no further interest. The charging order isn't unreasonable.

They are taking the view that you may be forced to sell the house anyway. As you are obviously under severe financial pressure. Perhaps only taking one further disaster to tip you over the edge.

Apologies for being blunt. Wish you well.

dichmau5

Hi,
I appreciate you being blunt its needed!
I am back in a good well paid job now (was only out of work for a year) and pay all my bills myself happily. I have resolved all financial problems and am clear by next year.
So i will not be forced to sell the house for defaulting, i never have. The debt problems were all as a result of my ex, who took out credit in my name and hid not paying other bills from me all of which only came to light after i managed to get him out the house. (By the police!).

I have always paid the solicitors every month without fail. I understand they want their money and of course i wish i could pay it all but i cant and have learnt it is more important to budget sensibly than panic and offer something unsustainable.

Again thanks for your time and advice, this forum is a god send at times :O)