Bank loan to pay off mortgage?

housebuyer143

tifo said:

Louisfrenchie said:

Out of interest, why is that? Is it to do with secured/unsecured status?

Any default and they'd secure it anyway by way of a Charging Order against your house.

You can't get a charging order on a jointly owned house. Only right too, it's not right to sell someone an unsecured loan and then secure it when they suddenly can't pay it back. 

GAMBITv5

tifo said:

Louisfrenchie said:

Out of interest, why is that? Is it to do with secured/unsecured status?

Any default and they'd secure it anyway by way of a Charging Order against your house.

True, but banks tend not to given the costs to do so. More likely get sold off to third party debt collector to remove facility admin costs etc

BikingBud

BikingBud said:

jimjames said:

Louisfrenchie said:

Is it not allowed?

Well I guess you're moving from secured to unsecured borrowing so the bank might not want that to happen. Check the T&Cs

Why, if the borrowing is unsecured against a car or a house it is still unsecured.

Secured loan gets paid off, they are happy.

Unsecured does it matter, they had a risk when they extended the funds how has that risk changed?

Anybody able to provide a perspective?

@K_S offers: Today at 10:15AM

tifo

housebuyer143 said:

tifo said:

Louisfrenchie said:

Out of interest, why is that? Is it to do with secured/unsecured status?

Any default and they'd secure it anyway by way of a Charging Order against your house.

You can't get a charging order on a jointly owned house. Only right too, it's not right to sell someone an unsecured loan and then secure it when they suddenly can't pay it back. 

With a joint mortgaged property, you get a charging order with a restriction to inform the creditor of a sale of the property, most conveyancers on your side will do this at the last moment.

I've had it myself with credit cards, many years ago (13+) but the restriction stays forever. Not that i'm selling anytime soon.

The problem is that the creditor obtains an interim charging order then you're told there'll be a hearing to make it final, where it's usually allowed.

tifo

ifo said:

Louisfrenchie said:

Out of interest, why is that? Is it to do with secured/unsecured status?

Any default and they'd secure it anyway by way of a Charging Order against your house.

True, but banks tend not to given the costs to do so. More likely get sold off to third party debt collector to remove facility admin costs etc

The debt collection agency is more likely to apply for a charging order as they've paid peanuts to buy the debt, as low as 3% in some cases.

housebuyer143

tifo said:

housebuyer143 said:

tifo said:

Louisfrenchie said:

Out of interest, why is that? Is it to do with secured/unsecured status?

Any default and they'd secure it anyway by way of a Charging Order against your house.

You can't get a charging order on a jointly owned house. Only right too, it's not right to sell someone an unsecured loan and then secure it when they suddenly can't pay it back. 

With a joint mortgaged property, you get a charging order with a restriction to inform the creditor of a sale of the property, most conveyancers on your side will do this at the last moment.

I've had it myself with credit cards, many years ago (13+) but the restriction stays forever. Not that i'm selling anytime soon.

The problem is that the creditor obtains an interim charging order then you're told there'll be a hearing to make it final, where it's usually allowed.

Like you say, it's only a restriction and they have no legal right to payment from the sale of the property. If you have any form K restrictions on your title these do not need to be paid.  

You will struggle to remortgage to a new lender though..

Jcbkabs

Check out this article written by a property barrister https://guildfordchambers.com/charging-order-works/ intresting read