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Charging Orders - general questions for clarification


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You have protection under the Trusts of Land and Appointment of Trustees Act 1996 which should stop a sale order in its tracks notwithstanding the negative equity aspect. If the property is jointly owned the interests in children should far outway that of charge holders.

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shazzyball

 

Ganymede and Sequenci have laid out the reality of an Order For Sale being granted let alone attempted. The fact you are in near negative equity alone means they would be complete idiots to try in this financial climate as they'd waste an awful lot of money for, potentially, no return.

 

And as only 0.3% of CO's ever progress to an OFS (have a read here http://www.shergroup.net/blog/?p=690) you can sleep easy that is not going to happen! The low percentage rate is simply because creditors know it's not going to happen in all but extreme cases (which yours isn't)

 

As I have previously said on this thread, I feel that once the Creditor takes this route they lose any bargaining power regarding repayments as there is now nowhere for them to go and they lose their "fear factor" to gain repayments (I hope your OH had a degree of satisfaction when telling them the £100 offer is no longer available).

 

I know everyone is different and you have to do what makes you feel ok; but my OH has refused point blank to talk her creditor since they gained a CO (Restriction) last year. They tried to phone and then wrote three times asking for payment or "further enforcement action will be sought through the Courts".

 

She continued to ignore them and they haven't been in touch for over six months. We also aren't in negative equity and we don't have any children under 18 at home, either. So stay strong as your circumstances really defeat anything effective they can now do to you.

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Also have a read here http://www.lawgazette.co.uk/in-practice/benchmarks/proportionate-orders-sale and also the link in there "Charging to the front of the Queue"

 

It's a bit long but it explains why Charging Orders are sought by creditors in the first place (as first come first served!) It also highlights why the creditor is always going to struggle to get an OFS if the debt is under £25,000.

 

Whilst it hasn't been passed as law, the author notes courts are reflecting "the way the wind is blowing" on the unfair proportionality of creditors collecting a debt under this figure, with an OFS, against the debtor losing their residential home.

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I have read with interest the issues where the debt is in sole name but the property is in joint names (my situation).

NWHL have obtained an Interim Charging Order and have applied for a Final Charging Order. Following the Interim Charging Order the Land Registry placed a RESTRICTION on the property which broadly follows all I have read - and that it is basically menaingless and does not 'secure' their unsecured loan.

I just wanted to check a slight deviation in the wording at the start. It states:

"RESTRICTION: No disposition of the registered estate, other than a disposition by the proprietor of any registered charge registered before the entry of this restriction, is to be registered without a certificate etc...."

 

Do the bold letters actually mean anything significant - I assumed this to just refer to the original charge over the property when the mortgage was taken out, by NWHL.

Thanks

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Hi GP

 

2 (07.05.1997) RESTRICTION: No disposition by a sole proprietor of the land (not being a trust corporation) under which capital money arises is to be registered except under an order of the registrar or of the Court.

 

3 (30.10.2007) RESTRICTION: No disposition of the registered estate by the proprietor of the registered estate, or by the proprietor of any future registered charge, is to be registered without a written consent signed by the proprietor for the time being of the Charge dated xx xxxxx xxxx in favour of XXXXXXXXXLimited referred to in the Charges Register.

 

Cutting out the technical mumbo jumbo the restrictions are fairly standard. The first would appear to indicate the property is co-owned. The Land Registry use that restriction so that one owner can not sell from under the nose of the other.

 

The second restriction is there to try and prevent the owner being able to sell the property without the mortgage being paid off.

 

A buyer's conveyancing solicitor during the conveyancing process would require confirmation that the restrictions would be complied with on completion. In the absence of such comfort the danger is that the buyer would not be able to be registered at the Land Registry.

 

Regards

 

Andy

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Thanks Andy....and I am right in assuming that such a restriction is basically meaningless, and that they cannot take the amount they are owed from sale proceeds (unlike the mortgage company - although it's both NWHL) ahead of others creditors who are not involved in legal proceedings.

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GP

 

See Post #11 of this thread and the response I received from the Land Registry Solicitor.

 

It confirms that all is required to comply with the Restriction (and therefore change the LR details upon sale) is for the purchasers solicitor to notify the Restriction holder.

 

But you are right in saying there is legal obligation to pay a creditor who has a Restriction placed.

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My understanding is that there is NO legal obligation to pay a creditor who has registered a restriction (rather than a Notice), and that a sale can rrely take pl;ace, the only obligation is to the mortgagee.

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GP

 

That is correct, but do expect resistance from some Solicitors many of whom (it would seem) don't seem to understand the changes in the LR.

 

They will try and tell you that you have to pay off the creditor with the Restriction or the sale can't proceed. That, as the LR have confirmed, is not necessary or required.

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We have been thinking about our position in all this and to be honest i think the best thing is to sell up and move into rented accomodation. I read that some solicitors are aware of the fact that they have an obligation to inform the charge holders of a pending sale but have no legal requirement to pay them. Is this correct? and are there solicitors out there that will act on that basis.

At least we will have some money left to try and start fresh. I dont think ican keep fighting on. It seems that the sub prime lenders are happy to allow customers to get into difficulty so they can go for the home and charge charge charge. Without the litigation side of the business they would make no money. both myself and my husband need to get away from these parisites who feed of all of us who are trapped by these sharks.

 

The fos are weak and are effectively paid by the lenders so it is obvious any claim will be defended, they wont bite the hand that feeds them either. The goverment should step in as a matter of urgency to protect all sub prime borrowers, taking someones home away from lenders who have changed the trading names in an attempt to clean up there act, were impicated in fraudulant activity abroad and have been fined for malpractice in the Uk, as well as using other solicitors (agents) in court to do the dirty, tell un- truths and have the right to keep charging these fees surely has to be illegal.They are all gangsters hiding behind the legal system and we are powerless in most cases.

 

I appreciate this site does everything it can to help all of us in financial difficulty but we need to lobby the government and show them what tactics they use to intimidate, bully and pursue us like vultures waiting for the ultimate goal, our homes.

 

We all need to fight back and send these crooks back to the states or prosecute them and shut them down for good. They seem to be a law to themselves and skirt round the law for there own greed. Putting families on the street costs the government in the long run, housing, Benifits,etc, where if they took the other approach and stopped these people from generating penalty fees then we all may be able to reduce our debts a lot faster, we would feel like we were getting somewhere and have the weight of these crooks taken away.

 

Something needs to change and quickly, the government needs to get a grip on this matter and call a halt to this form of loan sharking.

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shazzyball

 

If selling up and renting reduces your outgoings substantially then it may be a wise move due to your near negative equity (and it certainly reduces creditors options to put any pressure on you) but don't lose heart about your situation if you would prefer to stay put.

 

That is because you should now see that the CO route for creditors is more of a priority move on their debt than an actual move to regain immediate payment. They are now severely limited in what else they can do but wait for any type of payment. You can take advantage of that time to sort out what really is best option for the future.

 

And I agree with what you say regarding the loan sharking rates these companies have been getting away with under the toothless and largely ineffective financial regulatory services in the UK. Not allowing CO's to be granted for debts under £25,000 (as this Government said it would do but then bottled it) would have been a huge help in this financial climate to people in debt struggling to keep a roof over their head. But don't underestimate the power of websites like CAG in empowering people to fight back against these people.

 

And the terms of the Restriction on your house has now been clearly defined by the Land Registry as having 1) no legal weight to enforce payment and (2) a sale to a third party for money cannot prevent the LR details being changed. But you need to make sure your Solicitor understands this fact you will be paying him and he should be acting in YOUR interests and not that of the Restriction holder.

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Shazzyball,

I can sense the anger in your post, and I agree as I feel anger and frustration too.

This route of Charging Orders has been used by the creditor, to exploit a loop hole in law on so called"

" unsecured debt "

I am lucky to have a large amount of equity.would I pay my our creditor out of a sale. No!!!

Why because they caused so much stress at the time, and were so aggressive. We recently asked for a settlement figure letter received back signed" Head of Unsecured loans" What a Joke!. Stated you do need pay this now, just continue with your monthly payments. Our original loan term still hasnt

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Shazzyball,

I can sense the anger in your post, and I agree as I feel anger and frustration too.

This route of Charging Orders has been used by the creditor, to exploit a loop hole in law on so called"

" unsecured debt "

I am lucky to have a large amount of equity.would I pay my our creditor out of a sale. No!!!

Why because they caused so much stress at the time, and were so aggressive. We recently asked for a settlement figure letter received back signed" Head of Unsecured loans" What a Joke!. Stated you do need pay this now, just continue with your monthly payments. Our original loan term still hasnt expired.

Shazzyball sorry to rant, I would make a decision to suit your own particular circumstances, to give youpeace of mind, and benifit

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Hello everyone, thank you for an excellent thread. It has provided some comfort to my wife and I. I am on another thread which has ended up the CO route. I hope to conclude that thread soon, as it will be of enormous interest to all contributors.

But for now, I have had an unsecured 6K loan turn into a 25K claim. Creditor refused offer of payments and granted an ICO final CO hearing at the end of month.

I have been informed that because the judgement is forthwith, they may be able to make me sell my home to repay. These vultures have caused undue stress to my wife and I.

We are joint home owners and I am solely responsible for the debt.

My wife is a pensioner and suffers from a disabilty. The OFS issue had terrified us.

But, it would appear from the thread that we need not worry.

If I have interpreted correctly we can sleep at night once again.

My sincere thanks to all contributors.

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Hi again guys and gals,

 

Yes you can tell i was a tad angry, calmed down a bit now. our opinion is that if we can sell and not pay the charging orders then we would be better off selling up and renting for a few years untill the market picks up, trouble is we need to find a good solicitor who will work with us on this. Anyone know of such a firm?.Please pm me on this for obvious reasons.

 

It would give the charge holders a shock to find out we completed and know that we have done nothing illegal. Thankfully its only a restriction.

 

Oh,the satisfaction to get one over on these parasites. If the government dont sort this growing problem out then it will cost them dearly in the long run.

 

 

 

 

 

We can make a fresh start ride out the recession and rebuild our credit rating, if we can sell up that is.

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shazzyball

 

Understand that if you sell up the debt won't disappear but it will become "unsecured" again and makes "enforcement" of the debt very difficult for the creditor.

 

As for Solicitors, I'd start ringing them up now to get the feelers out on who you can use when the time comes.

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clynite

 

Have just located your thread but as its 200 posts long can you give a quick explanation how it got from 6k to £25k ???

 

But, yes I wouldn't be concerned given both the debt is only in your name and also you wife's unfortunate circumstances. As posted previously, only 0.3% of CO's ever progress to OFS which, in my opinion, is because creditors know they are so very difficult to obtain (plus, I believe they are expensive to do as well.)

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eggboxy1

 

Thanks for looking in. I have promised to update everyone on my thread when I can. But, not knowing what the moderators will allow, I thought I'd wait until the matter concluded. It is very complicated to say the least. But, I will try to be brief and not defame anyone.

 

A late application for an appeal was made by my sol. This was granted but a 'wasted costs order' was awarded against me for the late application. Then we had an appeal (lost). Then we had the trial (lost). Add the cost of these three events to debt and you have a balance of £24K. My sols on a no win no fee basis. So all these costs are the claimants.

 

I have been making payments towards the 'wasted costs' (wc) at a nominal amount. This was arranged via sols at the late application stage. I have maintained these informal payments to present time. Post trial judgement was ordered forthwith. I maintained wc payments while an intallment order application was made by my sols (albeit a late application). This was rejected by claimants and the court has made the judgement payable forthwith again.

 

This is why my wife and I have been worried. My sol has not been to supportive. Advice received from numerous sources implied that claimant could now go for OFS on property.

 

CO application taking place in matter of weeks. My sol says no point in objecting as claimant will get it. On what I've read, there is a time limit to object. But cant convince my sol of same.

 

I received an email earlier from sol, asking if I'd agree to a instalment payment slightly higher than original I/E figure and agree to the CO and suggest that the claimant review my financial cirumstances on the anniversary of the plan.

 

I hope you can see why I am panicking given the support I am getting. It is to late to appoint a new sol.

 

Hope this explains the dilema.

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clynite

 

Its fair to say I'm speechless at your experience! But first of all, don't agree to any higher repayments or a CO without going in front of a Judge to put your case across.

 

I know I haven't read your thread through yet but there does seem something very wrong about your Solicitors conduct in all this to let this happen? Hopefully, wiser eyes than mine can find something in their to redress the matter.

 

I can only (at this stage) give you the crumb of comfort in the fact that OFS are rarely ever pursued (as I said above only 0.3% ever are) so I wouldn't be too concerned (I know its difficult at times but take heart from all the examples on CAG of people with CO's still living in their own homes!)

 

The reason for the low rate is simply because the Judge has far more discretion over whether to grant an OFS over a CO where he has very little. So I can't, in a million years, see any Judge granting an OFS on the home of (with respect) a disabled pensioner for who isn't responsible for the debt! (A help on this is if you try Googling for examples where OFS have been applied for (let alone granted!) - let me now if you find any as I can't! Whereas there are hundreds of CO hearing examples)

 

Can I ask where the OFS "advice" has been coming from? You will hear OFS being muted by creditors as a scare tactic as they want you to cough up more repayments and,it's my opinion, Debt Help organisations don't help much either when explaining the fact that creditors can go for an OFS after a CO but not balancing it with the fact of how difficult (and remote) that process is.

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eggboxy1

 

Thanks for your support. The OFS has been muted to me by nearly everyone I have contacted recently ie friends, debt agencies, my sol has also intimated same but wont commit. His stance doesn't inspire confidence. The costs have been so high, as a result of claimant using barristers every step of the way.

My worry is, that my sol isn't on the same wave length as the rest of us. I realise there is a time limit on this matter which is fast running out. I cant afford to incur any more costs and dont know what to do for the best. It seem sol wants me to accept CO and new instalment payment. He has stated he doesnl't know if the claimant will go for this until we ask. I've told him to hold fire with any solutions as Im not ready to make an informed decision. ( I thought this is where the sol comes in) But, I dont think I am getting the best deal as it were. Phew, this is hard work! Our heads ache with the stress. I have asked him to consider objecting to the CO. He doesn't think it will serve any purpose as they will get it anyway. I told him about 'cymruambyth's' successful defence of CO. He asked me to send him a copy. I've also sent him CO information from 'debt4get'

Dont know what will transpire but, will keep u posted. Thanks

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eggboxy1

 

Thanks for your support. The OFS has been muted to me by nearly everyone I have contacted recently ie friends, debt agencies, my sol has also intimated same but wont commit. His stance doesn't inspire confidence. The costs have been so high, as a result of claimant using barristers every step of the way.

My worry is, that my sol isn't on the same wave length as the rest of us. I realise there is a time limit on this matter which is fast running out. I cant afford to incur any more costs and dont know what to do for the best. It seem sol wants me to accept CO and new instalment payment. He has stated he doesnl't know if the claimant will go for this until we ask. I've told him to hold fire with any solutions as Im not ready to make an informed decision. ( I thought this is where the sol comes in) But, I dont think I am getting the best deal as it were. Phew, this is hard work! Our heads ache with the stress. I have asked him to consider objecting to the CO. He doesn't think it will serve any purpose as they will get it anyway. I told him about 'cymruambyth's' successful defence of CO. He asked me to send him a copy. I've also sent him CO information from 'debt4get'

Dont know what will transpire but, will keep u posted. Thanks

 

 

If there really is no defence then, from a costs point of view, the best thing might be not to fight the CO.

 

As has been mentioned an OFS is very rare, especially if there is a vulnerable person living in the property.

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ganymede

 

Thanks for your input.

 

I beleive the claimant rejected my offer deliberately to justify their CO app. If I have understood correctly from information on this forum; if the instalment offer was accepted, then no chance of CO.

I have made and maintained regular payments post 'wasted costs order', these have been accepted by the claimant and are being deducted from the grand total. I will maintain these until trial.

It was only when an instalment app was made; they rejected. Court then made order payable forthwith. This is where the anxiety has arisen. We have been told that now, the claimant has nowhere to go but get a CO and possible OFS to repay debt. Because the debt is so large and given our age in relation to being not being able to repay in our lifetime via instalments.

It has become so stressful that we only want to know if there is merit in opposing, or if inevitable, give up and go with sol advice!

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