Rather worried about remortgage, please help :(

lynsayjane

Hi,

Am in process of remortgaging my flat and received a letter from the banks solicitors to inform me there is a 'second charge registered against my property in favour of the local council'. they are asking if I am paying this charge from the remortgage or if I wish them to arrange a deed of postponement (along with a hefty charge!)

I have absolutely no idea what this means or why I would be due the council any money (CT paid each month, have email receipts to back this up). Typically I get this letter on a Friday when the solicitor, my solicitor and even the financial advisor (that desperate for info) seem to have finished for the weekend.

I'm really worried this is going to throw a spanner in the works as the money for this remortgage is paying my deposit on my new home for which I've just exchanged contracts.

Can anyone give me any help in working out what this might be? I doubt I'll be able to talk to anyone official before Monday and don't want to spend the weekend worrying about it.

Thanks
LJ
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holly_hobby

If this is a charging order, it will need to be repaid upon sale of the property - as thats the whole point of CO.

If its anything else, the council would have to agree to a DOP, if not when your current mortgage is repaid, they will progress from 2nd chargee to 1st chargee (under succession of charges).

In this event, your new lender won't proceed, due to they requiring 1st charge, which isn't open to negotiation.

Indeed, even if the council do agree to a DOP, your new lender may still not accept the buisness, due to a 2nd charge hanging about in the background.

If you have no idea what this is in respect of, then you can do a search on your records with Land Registry, which will show who the chargee is and how much the charge is for - although it won't tell you why it was registered - http://www.landregistry.gov.uk/public. If you believe this in an incorrect registration,you will need to contact the LA to manage this apparant registration error.

There is also a land registry rep whom travels on the board, so he may pick this up.

Hope this helps

Holly

lynsayjane

Thanks, tried the link and wondered why it wouldn't work till I realised the map only showed England and Wales haha will go search for the Scottish equivalent.

Am going to try going into the local council office tomorrow though I don't imagine anyone who can help me will be in.

Dave_Ham

Did you buy from Council as part of a Right To Acquire, potentially with a discount?

lynsayjane

No, property was bought 12 years ago as a private purchase and have remortgaged twice during this time (not to release funds but due to rates ending) never had this problem before so it's something new within the last 7 years (didn't remortgage at last rate end as SVR was much lower than best deal on offer).

I'm confident I've paid all my council tax and have never been chased but if I hadn't would something like this be the result? Can they put something like a charging order on my property without informing me?

holly_hobby

No, a CO is only registered after you have defaulted (with notice) on a financial arrangement (which if not registered by mutual agreement, is usually after breach of a CCJ). It could be Council Tax, but I would doubt it given the other powers Local Authorities have to recover unpaid CT.

Given what you say, it appears that there may have possibly been a registration error at LR, where this charge has been registered under the wrong title number (ie it belongs to someone else !) .....

Now, I'm not saying this is the case, rather grasping at straws TBH - but given that you claim to have no unpaid debts, secured loans/creditors, or council tax issues ..... I can't think of any other explanation.

Its very puzzling ... so let us know you get on, once you've done a bit of digging with your Solicitor and LR on Monday.

Hope this helps

Holly

Dave_Ham

I too am trying to help as would hate to have to think about this all weekend, if you do not know what it might bew; chances are it will be nothing sinister.

I am not as familiar with Scottish Law, although is this likely to be anything to do with it being a flat?

Who do you pay service charges too, who has the freehold?

Clutching at straws too, just hopeful it may trigger something that will become obvious to someone..

chanz4

http://www.ros.gov.uk/

lynsayjane

thanks folks, solicitor and financial advisor on the case this morning so hopefully I'll be able to pass on good news soon. Trying to find details of who to contact at the council is like looking for hens teeth, all the website has is info for LA housing.

Can confirm though that I didn't buy from the council and I don't believe the property has ever been owned by the LA, certainly has no information to that effect in the title deeds.
With regards to service charges and free/leashold, I'm not 100% sure how this works in England but I believe in Scotland any charges are inclusive of council tax.

Likewise the numbering/naming of flats in Scotland can be very confusing. My hope is that this charge is relating to another flat in the property and has either been wrongly registered against my flat address or the search was done incorrectly.
Having looked at the Scottish land registry a search can take up to 5 days to get results. As we are needing this to be completed within two weeks I'll wait to hear what the banks solicitor comes back with before proceeding as it could be sorted within the 5 days.

Thanks for your help and advise so far, will keep you updated on the resolution.

LJ
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lynsayjane

All,

I hope good news to update. Having had a copy of the search report from the solicitor it showed the 'charge' is relating to payment of a repairs grant. I managed to then find the correct person to speak to at the council who advised that it is merely notification of a grant given to myself (along with the other flat owners) four years ago in relation to some works carried out to the roof and walls of the property.
A tile had slipped which allowed damp into the upper floors of the property. A 'serious disrepair notice' was put in place which forces the works to proceed and the owners to pay their portion. As I had paid mine at the time I didn't even think it would be related to this.
The grant shows on property searches not as a charge to be paid but to inform buyers (if I were to sell) that this is in place as there are conditions attached regarding maintenance of the property which they would then be obliged to adhere to for five years following the grant being given.

I've informed both solicitors about it and hopefully it won't cause any concerns to the remortgage now.

Many thanks for your support and advice.
LJ
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Dave_Ham

Nice to get a happy ending.

May want to thank your Solicitor for you getting the letter without the detail on a Friday...

Good luck with the rest of the process..