Loan being sold despite a charge on the property 16 December 2022 at 11:45AM in Loans 6 replies 715 views

Tootles64

Hi there, I hope someone can advise me on this complicated situation.
In 2009 I had a large Overdraft with Lloyds Tsb/Black Horse. To deal with this they made it into a loan (in the name of Black Horse) and then got a CCJ and a charging order on my property.
In 2010 I started an IVA and mistakenly added in both the amount on the charge and the same amount as an overdraft...
So, somewhere this must have triggered Lloyds to flag it as a bad debt account and sell the debt (the overdraft) despite there being a charge already on the property in respoect of the same

Fast forward to 2022, I am trying to sell my property and there is a charge. I've been informed the debt has been sold to TDX group/Grove but the name on the charge is still Black Horse. TDX apparently (according to Black Horse legal team) should have registered the charge in their name, but they didn't.

I've been in contact with both. Black Horse didn't know anything about the debt being sold. TDX group say once I've paid them the figure, they will inform BH and get the charge lifted.

Can this be right? I thought once a debt was sold, it was no longer the original creditors issue. Do I have any guarantee that TDX group will tell Black Horse? 
Can I legally ask BH to remove the charge as they no longer have a financial interest in the property having sold the loan?

sourcrates

Question, did your IVA complete successfully?

Because if it did, and the debt was included in the arrangement, then the debt was written off, and because the IVA is legally binding it then supersedes and overturns the Judgment also.

So if that were the case, there would be no debt, and no judgement, and the charge should have been removed by the original creditor.

Why did that not happen?

Farfetch1

sourcrates said:

Question, did your IVA complete successfully?

Because if it did, and the debt was included in the arrangement, then the debt was written off, and because the IVA is legally binding it then supersedes and overturns the Judgment also.

So if that were the case, there would be no debt, and no judgement, and the charge should have been removed by the original creditor.

Why did that not happen?

A secured debt would not be included in an IVA.

The OP reads as them having a charging order before they entered an IVA. If so, the fact that they listed it as an overdraft is irrelevant.

A secured debt can absolutely be sold, as can any debt.

silvercar

sourcrates said:

Question, did your IVA complete successfully?

Because if it did, and the debt was included in the arrangement, then the debt was written off, and because the IVA is legally binding it then supersedes and overturns the Judgment also.

So if that were the case, there would be no debt, and no judgement, and the charge should have been removed by the original creditor.

Why did that not happen?

Surely that would mean including the charging order in the IVA as an unsecured debt takes away the security of the charging order. It would mean that anyone including a secured debt (including a mortgage) in an IVA would get the secured debt written off and so effectively remove the security to the creditor? It would be a loophole open to abuse.

fatbelly

This is complex.

If you ask on this thread

https://forums.moneysavingexpert.com/discussion/1839539/charging-order-the-myth#latest

the Land Registry rep should be able to help

sourcrates

It is complex, a secured debt should not be allowed in an IVA, but it appears that it was.

Usually in matters of law, what has occurred takes precedence over what should/should not occur, of course it would be nice if the OP can confirm successful completion of the IVA, or not.

I agree its possibly one for the Land registry rep.

Land_Registry

From a purely registration perspective the devil is as always in the detail here and it’s unclear how the interest(s) is/are registered
If there’s a non-secured debt registered, so not as a legal charge, then it can be sold and the register doesn’t have to be updated. The debt/interest still exists whoever the creditor is. 

So settling the debt with Y as the current creditor and X as the named creditor then applying to discharge it is possible. 

You have the register and what it says so you work from there to get any third party interests settled/removed/sorted prior to selling. The register detail is what’s missing here re any insight we can give.