Jump to content


Charging Order - 2 charges in place - do both creditors have to agree action?


Destinago
style="text-align: center;">  

Thread Locked

because no one has posted on it for the last 3649 days.

If you need to add something to this thread then

 

Please click the "Report " link

 

at the bottom of one of the posts.

 

If you want to post a new story then

Please

Start your own new thread

That way you will attract more attention to your story and get more visitors and more help 

 

Thanks

Recommended Posts

I obtained a charging order in the high court on a debtor's rental property (ie not his home). The mortgage company have first charge. The property may be in negative equity, but house prices are currently increasing.

 

1 - Is either creditor obliged (or likely) to inform the other how much they are owed?

 

This would obviously help in deciding whether to force a sale.

 

2 - Can either creditor force a sale against the wishes of the other?

 

3 - Can either creditor stop a sale by the debtor?

 

4 - Until the debt is repaid I understand the charging order will stand indefinitely. Will the statutory 8% interest also run indefinitely?

 

Thanks.

Link to post
Share on other sites

Don't know the answers to your questions. But I do know from other posts that secondary creditors do sometimes force the sale of property and sometimes the first charge (often mortgage company) don't know this is being done. Even if they were told, they may choose to do nothing about it, because they have contingency insurance and can bring their own legal action to recover any debt, if they wanted to do so.

 

Are you certain that it is easy to force the sale of this house ? What steps do you have to take, before you could do this ? You may have to demonstrate to a court, that you have sought payment from the debtor following the charging order with no success and there is no other way to recover the debt, but to force the sale of the house. What costs could you be liable for as part of the process of forcing the sale of the house ? If the property is tenanted, they have certain rights which would have to be considered. Therefore it may not be a quick or cheap process.

 

Think you need to obtain some formal legal advice about this, before you start any proceedings. The cost of doing this and time it would take, may put you off. If I were in this situation, I think I would write to the debtor, asking whether they were in a position to make regular affordable payments, to avoid any further actions, such as an order to force the sale of the property.

 

Do you know all of the possible costs that would be taken off, before any equity is revealed ? There may be nothing left. A house that is subject to a forced sale, often goes for below the normal market rate.

We could do with some help from you.

PLEASE HELP US TO KEEP THIS SITE RUNNING EVERY POUND DONATED WILL HELP US TO KEEP HELPING OTHERS

 

 Have we helped you ...?         Please Donate button to the Consumer Action Group

 

If you want advice on your thread please PM me a link to your thread

Link to post
Share on other sites

Thread moved to the appropriate forum.

 

Regards

 

Andy

We could do with some help from you.

PLEASE HELP US TO KEEP THIS SITE RUNNING EVERY POUND DONATED WILL HELP US TO KEEP HELPING OTHER

 

Have we helped you ...?         Please Donate button to the Consumer Action Group - The National Consumer Service

If you want advice on your Topic please PM me a link to your thread

Link to post
Share on other sites

1 - I don't think they would be obliged to inform you of the amount outstanding. You could ask for it though. It would come out if you tried to force a sale and they objected.

2 - Yes, though the court has discretion whether to order a sale and will take the wishes of the first creditor into account especially if the property is in negative equity.

3 - No, in theory I guess you could get a court order or injunction preventing sale but this would be difficult to get.

4 - Statutory interest will run run if this is provided for by the terms of the judgment and charging order.

PLEASE HELP US TO KEEP THIS SITE RUNNING

EVERY POUND DONATED WILL HELP US TO KEEP HELPING OTHERS

 

Link to post
Share on other sites

You may have to demonstrate to a court, that you have sought payment from the debtor following the charging order with no success and there is no other way to recover the debt, but to force the sale of the house. What costs could you be liable for as part of the process of forcing the sale of the house ? If the property is tenanted, they have certain rights which would have to be considered. Therefore it may not be a quick or cheap process.

 

I think I would have a good case for forcing a sale. Other attempts to obtain payment have proved fruitless given the inadequacy of current legislation. But it would be pointless forcing a sale if the house was in negative equity - which is why knowing the size of the mortgage would be useful. As for the costs, couldn't I add these to what I'm owed?

 

I guess you could get a court order or injunction preventing sale [by the debtor] but this would be difficult.

 

If true this is bad news. I thought the benefit of putting a charge on a property was that the owner could not sell it without the permission of the charge holder. Is that not the case?

 

It would be pointless if the debtor can sell whenever he likes - even at a loss. The bank will be well placed to pursue him for any shortfall in the mortgage repayment. But I would have to start from scratch. Is that not so?

Link to post
Share on other sites

I think I would have a good case for forcing a sale. Other attempts to obtain payment have proved fruitless given the inadequacy of current legislation. But it would be pointless forcing a sale if the house was in negative equity - which is why knowing the size of the mortgage would be useful. As for the costs, couldn't I add these to what I'm owed?

Yes, you could probably recover most of your legal costs if successful. But if house is in negative equity a costs order would be pointless if you can't enforce it. Most likely you'd have to pay your solicitors regardless of what you recover from him.

 

If true this is bad news. I thought the benefit of putting a charge on a property was that the owner could not sell it without the permission of the charge holder. Is that not the case?
The owner can still sell the property. However the money would have to be paid to the charge holders. If there is not enough money the owner would receive nothing, so it is difficult to see why he would want to sell.

 

It would be pointless if the debtor can sell whenever he likes - even at a loss. The bank will be well placed to pursue him for any shortfall in the mortgage repayment. But I would have to start from scratch. Is that not so?
Yes, if the property is sold you and there is not enough left over, you will be an unsecured creditor.

PLEASE HELP US TO KEEP THIS SITE RUNNING

EVERY POUND DONATED WILL HELP US TO KEEP HELPING OTHERS

 

Link to post
Share on other sites

Is there not a court application the OP can make, which would require the debtor to make a full financial statement, including the current mortgage amount outstanding ?

We could do with some help from you.

PLEASE HELP US TO KEEP THIS SITE RUNNING EVERY POUND DONATED WILL HELP US TO KEEP HELPING OTHERS

 

 Have we helped you ...?         Please Donate button to the Consumer Action Group

 

If you want advice on your thread please PM me a link to your thread

Link to post
Share on other sites

Its possible to seek an order that the debtor attend court for questioning about their assets. How productive that would be depends.

 

Not remotely I'm afraid. Been there. Tried that. 'Personal service' of the court order proved impossible...

Link to post
Share on other sites

  • Recently Browsing   0 Caggers

    • No registered users viewing this page.

  • Have we helped you ...?


×
×
  • Create New...