I do not agree that the second stage is always granted;
see;
http://www.nationaldebtline.co.uk/engla ... unty_court
http://www.insolvencyhelpline.co.uk/debt_factsheets/
charging_orders_in_the_county_court.htm#4
The application for a charging order always has two stages.
Stage one - the interim order
The creditor makes an application for a charging order and the court will make what is called an interim charging order if it is satisfied that you own, or have a part share (an interest), in the property in question. This is not the final order. An interim charging order is usually made automatically without a hearing and a date for a full hearing is set. A copy of the interim order will be sent to you. This should be done at least 21 days before the hearing date set by the district judge. The hearing is for the court to decide whether or not to make the charging order permanent ('Final'). This hearing is likely to be held in the district judge's private rooms.
The creditor will also register the interim charging order as a 'caution' on your property with the Land Registry who should inform you of this in writing. This means you cannot sell the property before the hearing.
Stage two - the final charging order
The second stage is the court hearing in front of the district judge. At this hearing the court will decide whether to make a permanent charge on the property. This is called a final charging order. If you object to a charging order being made final then you should send the creditor and the court written evidence stating why you object. You should do this at least seven days before the hearing. This could be in the form of a letter of objection outlining all the arguments you have for why the charging order should not be made. This should be sent by registered post to both the creditor and the court.
If you do this then your arguments should be taken into account by the district judge at the hearing. You should still go to the hearing and if you do not send any written evidence then it is vital that you go.
WARNING
The court can refuse to make the charging order so you must serve a notice and go to the hearing. If you cannot attend on that date, contact the court for a different hearing date to be arranged. If you do not go the charging order is likely to be made final by the court at the request of the creditor.
ADVICE
If the hearing has been arranged in another court, ask for it to be transferred to your local court. You can apply on an application form called an N244 explaining why you can't go to the hearing, e.g. due to the distance, travel or childcare costs. There is a fee for this.
HOW CAN I STOP A CHARGING ORDER?
The court must consider whether it is reasonable to make a charging order. Under the Charging Orders Act 1979 the court has to consider all the circumstances of the case and in particular:
the personal circumstances of 'the debtor';
whether any creditor would be 'unduly prejudiced'. This means the court has to decide if making a charging order would disadvantage other creditors.
The arguments you can use against the order being made will vary depending on your circumstances, whether you have any other debts, whether you have equity in your house and own your home in joint names or on your own.
These are some of the factors that the court may consider.
Does any member of your family have a disability or serious illness?
If you have a number of debts and making a charging order in favour of one creditor would give them unfair priority over the other unsecured creditors. It is particularly useful if you can show you already have a payment arrangement in place with your other creditors. This would be upset by an order being made. Point out if any of the debts are larger than this debt and if any other creditors have frozen the interest.
Your creditor is supposed to list all the other creditors that they are aware of in the application for an interim charging order.
The court can order the interim order to be sent to the other known creditors but does not have to do this. This means that creditors who may want to object to the final charging order being made will not know about the hearing. You can raise this in your written objections and at the hearing if you think a creditor may be 'unduly prejudiced' by the charging order being made.
Could the creditor have given you a secured loan when you first took out the loan? If they decided to offer an unsecured loan instead, this could be particularly relevant if you have other unsecured creditors who may be disadvantaged by a charging order being made.
There are other ways the court could enforce payment of the debt. You could ask the court to make an instalment order so you make monthly payments you can afford, or an attachment of earnings order so that the instalments would come directly from your wages. This is only useful if you are employed and your employment would not be at risk.
FREE ADVICE IS THE BEST ADVICE
LEYBRIDGE LIMITED
Whole of Market Mortgage Broker & Mortgage packager
Specialising in adverse credit.
Directly Authorised Firm FSA No:313790
CeMAP 1,2 & 3 qualified
F.P.C 1,2 & 3 qualified
Financial Planning Certificate
Certificate in Regulated Customer Care
Certificate in Regulated General Insurance
Associate of the Charted Insurance Institute
see feedback and testimonials at:
http://www.leybridge.com/testimonial.php
Check out my blog at:
http://mikebdomain.blogs.iva.co.uk/
Please read our Initial Disclosure Document(IDD):
http://www.leybridge.com/Leybridge-IDD.pdf
