Debt Collection: Your judgment debtor owns a Property – a Guide to Charging Orders
February 27, 2017
If you find out your judgment debtor owns a Property then a Charging Order can be the best option. This is a method of securing the judgment debt. You can then either wait until the Property is sold; accept an instalment arrangement; apply for an Order for Sale or take alternative enforcement action.
Pros of seeking a Charging Order
- You are secured and so not vulnerable if the debtor is made bankrupt.
- Interest accrues if the debt is over £5,000
- Costs incurred are added to the judgment debt
- This may result in a realistic payment arrangement so as to avoid a charging order being made
- You can apply for an Order for Sale
Cons of seeking a Charging Order
- Payment of your debt through realisation i.e. sale of the Property could take years
- If there is negative equity you are not secured
- You may have to accept minimal instalments pending sale
- You’re unlikely to obtain an Order for Sale for a small judgment debt
- The Court has discretion not to grant an Order for Sale
How much does a Charging Order cost?The fees involved are:
- £110 Court fee
- £3 Land Registry document fee
- £40 Land Registry registration fee
- Plus solicitors fees
The information contained in this article is intended for general guidance only. It provides useful information but it is not a substitute for obtaining legal advice as the articles do not take into account specific circumstances. So do please Contact US for legal advice on the issues raised.