Charge on property

moneyistooshorttomention

I'm not familiar with exactly what things mean and wonder if someone could please explain to me?

- If someone has a "charge" down on their Land Registry entry against their home (ie from a loan company), then what exactly does that mean? Does it mean what I think it means, ie that that person took out a loan with that company and then defaulted on it and the company has basically given up hope of having that loan repaid and therefore put a charge on their house. If I am correct in thinking that - then I guess that means the person doesn't have to make any further repayments on the loan, but would have to pay the money back to the loans company when the house got sold?
(Alternatively, could it be that the loan payments are being paid okay, but the loan company has got their name down as a "charge" because the house got used as security for that loan by the home-owner?)

- If they did have to repay the loan at house-selling point, then would the company be able to charge interest on the amount outstanding (ie at the time they took back the money they were owed out of the house equity)? (ie assuming scenario 1 - where the loan company had given up hope of having the loan payments made as agreed originally).

- If there is a charge already down against a house, then would a mortgage company give the house-owner a mortgage on the house (ie some years after the home-owner had originally purchased the house and after the date the charge was already registered against the house-owner on the Land Registry details?)

~Beanie~

It doesn't necessarily mean that they defaulted. Taking out a secured loan would mean a charge being put on your house (that's exactly what secured means, the loan is 'secured' against your house). Monthly repayments would still be made.

moneyistooshorttomention

Thanks.

The exact word used is "caution", but as far as I can make out "caution" and "charge" are much the same and its just the case that the word "caution" got used on Land Registry entries some years back (whereas these days they would use the word "charge")?

sourcrates

moneyistooshorttomention wrote: »

Thanks.

The exact word used is "caution", but as far as I can make out "caution" and "charge" are much the same and its just the case that the word "caution" got used on Land Registry entries some years back (whereas these days they would use the word "charge")?

Maybe just the politically correct way of saying the same thing !!!!

sithemadmonkey

What's the full text of the charge on the title deeds? It usually gives some indication of the purpose of the charge (be it charging order, mortgage, etc).

moneyistooshorttomention

There was only the year it was made and the name of a loan company. I didn't spot any further details at all.

Land_Registry

There are a wide variety of terms used to describe a variety of circumstances both by ourselves, property professionals and citizens.

A caution for example is an entry on the register that shows the name and address of a person or organisation that claims an interest in the registered land (or charge). It does not state the nature of that interest. A caution stops any dealing with the land (or charge) from being registered without the cautioners being given notice and the chance to object.

As you already appreciate it is no longer possible to register a caution (since Oct 2013) but the interests protected by such an entry still exist but they would be registered either as a Notice or as a Restriction instead if you were applying to register the interest/charge today. Our guidance on the protection of third party interests explains this further.

The reason we tend to refer to them as interests and not charges is largely due to the fact that a charge is often referred to in the context of a legal or registered charge which in turn is really a mortgage or loan secured against the property/title.

The original questions are though largely outside of our remit as we are simply not involved in how the financial aspects are then dealt. The entry will I suspect provide the cautioner with a degree of leverage should the owner for example want to sell the property in the future as the buyer would want guarantees that the entry would be removed. But what leverage exists prior to that moment would be something to ask a legal or financial adviser who was also aware of how the interest had come about as any impact will vary depending on the circumstances no doubt i.e. credit card loan, charging order granted and so on