Can A DCA get a charge on property?

[hedake]

Hi,

Hoping someone can help?!

Can a DCA put a charge on property? Was looking through some old papers and I found a request to put a charge on the house back in 2008. This time was hazy as we had a new baby in the house so it was cast aside. It said they would freeze interest on the debt if we agreed to it?!

Time has passed and the accrued interest on this account now surpasses the oc's payment which we paid nearly 3 years on a 60 month agreement before default. The amount is approx double since the last payment made as part of the agreement. I don't know if there is much I can do the DCA is LFO.

I would be grateful of any input regarding these guys. What a lovely bunch they are!!!

[Tawnyowl]

Till some others advise bit of info about charging orders.Did the DCA take the debt to the county court. http://www.insolvencyhelpline.co.uk/debt_factsheets/charging_orders_in_the_county_court.php

is LFO part of LINK FINANCIAL GROUP

Edited January 10, 2011 by tawnyowl

[DonkeyB]

Depends if it’s a DCA acting on behalf of a client – in which case NO – or a debt buyer like Link, which owns the account, in which case YES.

 

Did you ever request a CCA for this account?

[payback68]

Hi,

 

Have a read through the following link, it explains in detail about Charging Orders ETC :-

 

http://www.nationaldebtline.co.uk/england_wales/factsheet.php?page=15_charging_orders_in_the_county_court

 

PB68.

[hedake]

I think the debt is owned by Link but they seemed to be asking for our agreement to put a charging order on?! When they took over the balance was approx £4200 so thought it might of been because it was less than £5000? However it is now £6300!! I know it could be worse only it could be the difference between staying on the DMP or going bankrupt as we will never be able to catch up with the interest let alone pay the balance!

Thanks for all replies.

[jimbo45]

Hi there

Charging orders of under 5,000 GBP CAN HAVE NO INTEREST added to ithem. If there is interest then perhaps you could go for a set aside as this is NOT ALLOWED.

 

IMO the use of charging orders is grossly overdone since it can take YEARS for an OC to get any money back -- Courts will almost NEVER order a forced sale so your CCJ now becomes "an Interest Free Loan".

 

Do NOT voluntarily allow them to put a charging order on the property though -- make them go through the County Court system -- you could then see if there are PPI / other illegal charges on the loan and get it quashed.

 

If it's valid then just go with the flow. Actually they need to get a CCJ first so you could at the hearing offer 1 GBP a monthy ad infinitum. That should shut them up.

 

Actually it's often a good way now of getting a cheap Full and Final settlement since the Greedy DCA's etc will much rather say they will take 1500 GBP over a few instalments NOW than wait say 30 years or more before you move house by which time the debt will have been reduced so much by inflation etc that it's worth nothing.

 

The whole use of Charging orders for unsecured credit card / other debt is grossly overdone -- but the DCA's never learn do they.

 

Charging unrealistic rates of interest especially to people who are already struggling with debt unfortunately seems to be the norm for this most despiccable of industries -- at some rates of interest debts will NEVER be cleared.

 

Note about Interest on Charging Order

 

....................

INTEREST

 

If the creditor has taken the debt to the county court, they may be able to add extra interest once a charging order is made. Interest cannot be added if:

• the debt is for an agreement regulated by the Consumer Credit Act. This includes most ordinary credit agreements, including bank overdrafts; or
  
• the debt is less than £5,000 in total, even if it is not covered by the Consumer Credit Act.
  

INFORMATION

If the debt is more than £5,000 and not covered by the Consumer Credit Act, then interest is set by the court and runs at a standard rate.

 

Cheers

jimbo

Edited January 11, 2011 by jimbo45
added info about interest on Charging order

[Happyhippy1959]

jimbo45

 

Agree entirely with what you say. Can I just clarify one thing, any debt no matter what the amount, if it is covered by the CONSUMER CREDIT ACT cannot have interest added on to it.???

[jimbo45]

Hi there

Yes you ARE correct -- if the debt is covered by Consumer Credit acts then NO INTEREST can be added to charging order --so as above it's often a way of STOPPING INTEREST STONE DEAD.

 

Greedy DCA's fell into this trap thinking a Charging Order was a nice easy way of earning money -- however some of the "smarter ones" -- a contradiction in terms when talking about DCA's -- have finally realized this and are going down the SD (Statuatory Demand) route rather than by using Charging Orders.

 

You NEED to take action if they issue an SD even if you can get it set aside -- however for most Charging Orders just sit back and enjoy the Interest Free ride. After a period if and when your finances have improved you are in an EXCELLENT position to offer them a Full and Final Settlement which I suggest you start offering at round 15%.

 

After a little haggling GREED takes over --they want Money NOW not in 30 years time when you *might* consider selling up / moving. In any case inflation etc will have seriously eroded the debt in any case.

 

The whole purpose of Charging Orders these days is really irrelevant --and UNSECURED DEBT should remain UNSECURED --that's why the Interest rates are much much higher -- the Banks take the risk. They shouldn't have it BOTH ways.

 

I believe there is some proposal going through the Coalition to ban the use of Charging Orders on unsecured debt like Credit Cards etc for amounts of under 25,000 GBP. In any case it's almost unheard of for a Court to order a Force Sale of a property -- there has to be another hearing etc etc and it's a tedious process for a DCA to follow.

 

Cheers

jimbo

Edited January 18, 2011 by jimbo45