I currently have an installment order in place. The creditor wanted more than we offered but we went for a redetermination hearing where the creditor did not turn up and so the judge agreed with our payment offer. We have not defaulted on this agreement but the credior is now applying to court to try and get this installment order changed to a forthwith and put a charge on the property. Is this possible if we have not defaulted on the original installments plan. They are saying that as it will take 8 years too pay then this is why they want a charging order it did say they would not force an order of sale provided we maintain the payments. If they do get the charging order will we still be able to have an installments order in place.
Hi
I think that you can keep the payments as agreed, the creditor is just securing their debt and the court will decide on the monthly payments.Unless your circumstances have improved it is unlikely that the monthly figure will change
Regards
Hi Hopeful, this company sounds like they are trying it on to me, I would speak to your local citizens advice bureau or shelter. They can of course apply for what they want, wether or not the court grants it is a different matter :
1. I would NOT 'consent' to a charging order being placed on the property.
2. If the creditor makes an application I would front the following arguments against it :
(a) You are already paying a previously agreed amount and there is no requirement for the creditor to seek any further application.
(b) In seeking such an order the creditor is simply seeking to lever you to pay more or preferentially against than other creditors and their actions are unreasonable (There is a duty to act reasonably).
(c) A charging order is prejudicial to the interest of the main mortgage holder who has not been consulted and at the very least the creditor ought to seek to clarify wether or not the main mortgage holder has any objections which they have not done so.
(d) A charging order will give this creditor an unfair advantage of security which any other creditors do not enjoy (all creditors should be treated equally).
I would also keep my eye on costs - they are bringing the application unreasonably and I would make sure they do not try adding 'costs' for applying for the order to your debt.
More importantly I would make sure that in their application there is not an 'order for sale' provision if they are succesfull in obtaining the order i.e they have the automatic right to sell your property if you breach your current instalment plan without recourse back to the court. If this is the case vigorously contest this part of it. At the very least you would not want them to be able to sell the property without having to go back to court.
In any case I think they are being unreasonable, if you are paying what you have already agreed and I would fire off a letter to the relevant regulator. I also think this is a clear breach of the OFT guidelines on Debt Collection Practice which you should read if you have not already done so.
I cannot see a charging order being granted, if you demonstrate that you have co-operated all along with the creditor concerned and are paying them in pro-rata to your other creditors based upon your disposable income.
Try and get yourself some legal representation, or at least turn up to the hearing - judges are usually very sympathetic to people who cannot afford lawyers and are doing their best to deal with their creditors fairly.
Greedfighter is spot on - I agree with Melanie - go to any hearing and resist as you are doing what a Judge agreed.
Regards, David Mond, Insolvency Practitioner for over 46 years. Personal Insolvency Practitioner of the year 2012, Personal Insolvency Practitioner of the year finalist 2013 & 2014 awarded by Insolvency & Rescue Magazine and 2015 finalist for Personal Insolvency Firm of the Year.
