Charging Order

What is a Charging Order?

A Charging Order is a remedy after judgment which a lender can seek from the courts once it has judgment. Alternative remedies after judgment include Attachment of Earnings Orders and Garnishee Orders.

The Charging Order effectively places a sort of mortgage on your property at the direction of the court. It is a charge over the net sale proceeds, so usually has little impact until you go to sell your property, when the amount, plus interest and any costs must then be paid to the lender. The cost incurred by the lender to apply for the Charging Order will also be included in these costs.

It is not possible to re-mortgage or to obtain a secured loan when a Charging Order is in place. The creditor can also apply for an Order of Sale following a Charging Order, although this is rare and most are content to wait until the debtor chooses to sell the property.

Once a Charging Order is granted, a record of this will be held at HM Land Registry for 12 years, although this can be removed at the discretion of the creditor once the order has been settled in full. The record of the Charging Order remains on your credit report (but only in the form of the original CCJ) for 6 years.

The Court will only grant a Charging Order if the original disputed sum has not been paid, or if an arranged instalment plan has one or more missed payments. If you are purchasing a house, your solicitor will check with HM Land Registry (or with the Registers of Scotland) to ensure that all Charging Orders have been settled before you purchase.


Q: Can you stop a charging order?

A: Before a Charging Order can be applied, you will receive an interim charging order. Once this has been received, you will have 28 days to dispute this with the court and the lender involved. Following this, a hearing will take place, where the court will assess the information you have provided to determine whether the creditor can go ahead with a charging order.

If you can prove to the court that regular payments are already being made towards the debt, you may be able to prevent a charging order.

Q: How soon after a CCJ can a Charging Order be requested?

A: As of 2012, creditors can apply for a Charging Order as soon as a CCJ has been issued.

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