How do I put a charge on someone's property?
Discussion
paoloh said:
The Contrarian said:
register the charge at the land registry
Is it that straight forward?Then you file it with the land registry as a class C(1) land charge IIRC. His mortgage company will be stroppy about this, but that's his problem. You may also want to ensure that you get your money before the mortagee, if possible.
Jasandjules said:
paoloh said:
The Contrarian said:
register the charge at the land registry
Is it that straight forward?Then you file it with the land registry as a class C(1) land charge IIRC. His mortgage company will be stroppy about this, but that's his problem. You may also want to ensure that you get your money before the mortagee, if possible.
As a rule of thumb, how much should I pay for the document?
Can I put restrictions like no other charges ( apart from mortgage ) can be applied?
Are you happy to wait until he sells? I mean, what if he dies? Title could pass to someone else in his will? I'd be inclined to also put in a clause to be able to force a sale under certain circumstances (can you say that you will never need this money?).
I think in the main the mortgage company will also be ranked first and I suspect they will have a clause that says that no-one else can have a charge without their consent, however that is his/their problem, not yours. They would have to go after him for any loss. I'd certainly try and ensure you are paid out first......... If not possible, then ranked pari passu with the mortgage co.
Cost? Shouldn't be more than £150 or so, a local firm could well charge a lot less.
I suspect the forms you might want are here
http://www.landreg.gov.uk/publications/?pubtype=49
Though the solicitor should have a copy. Your mate will of course need to sign it.
I think in the main the mortgage company will also be ranked first and I suspect they will have a clause that says that no-one else can have a charge without their consent, however that is his/their problem, not yours. They would have to go after him for any loss. I'd certainly try and ensure you are paid out first......... If not possible, then ranked pari passu with the mortgage co.
Cost? Shouldn't be more than £150 or so, a local firm could well charge a lot less.
I suspect the forms you might want are here
http://www.landreg.gov.uk/publications/?pubtype=49
Though the solicitor should have a copy. Your mate will of course need to sign it.
Jasandjules said:
Are you happy to wait until he sells? I mean, what if he dies? Title could pass to someone else in his will? I'd be inclined to also put in a clause to be able to force a sale under certain circumstances (can you say that you will never need this money?).
I think in the main the mortgage company will also be ranked first and I suspect they will have a clause that says that no-one else can have a charge without their consent, however that is his/their problem, not yours. They would have to go after him for any loss. I'd certainly try and ensure you are paid out first......... If not possible, then ranked pari passu with the mortgage co.
Cost? Shouldn't be more than £150 or so, a local firm could well charge a lot less.
I suspect the forms you might want are here
http://www.landreg.gov.uk/publications/?pubtype=49
Though the solicitor should have a copy. Your mate will of course need to sign it.
If he has a charge over the property, and his mate dies the title can not pass to another without his charge being satisfied first. That's the point of the charge. I think in the main the mortgage company will also be ranked first and I suspect they will have a clause that says that no-one else can have a charge without their consent, however that is his/their problem, not yours. They would have to go after him for any loss. I'd certainly try and ensure you are paid out first......... If not possible, then ranked pari passu with the mortgage co.
Cost? Shouldn't be more than £150 or so, a local firm could well charge a lot less.
I suspect the forms you might want are here
http://www.landreg.gov.uk/publications/?pubtype=49
Though the solicitor should have a copy. Your mate will of course need to sign it.
There is no way any lender is going to allow him to rank before them. If the lender won't agree at all, it's not his mates issue, it's his as he won't be able to register the charge.
You also need to take into account if anyone else lives in the house as they may have rights which will effect your ability to call up the charge.
Take legal advise, if this is the only route to secure your money, it will be money well spent.
But if the property is not sold, and the clause states "on sale" etc. then the clause won't kick in?
That's how I'd be looking to word the charge if I was on the other side.
Ah right, I didn't know that a lender can refuse to permit a charge to be lodged. I was of the impression that a charge is registered when the owner of the property consents. After that, it's for the lender to argue the toss with the mate. But if that is not the case then fair enough.
It's always wise to get a solicitor, who specialises in this sort of thing, to write it. You are also covered by his indemnity insurance to be on the safe side.
That's how I'd be looking to word the charge if I was on the other side.
Ah right, I didn't know that a lender can refuse to permit a charge to be lodged. I was of the impression that a charge is registered when the owner of the property consents. After that, it's for the lender to argue the toss with the mate. But if that is not the case then fair enough.
It's always wise to get a solicitor, who specialises in this sort of thing, to write it. You are also covered by his indemnity insurance to be on the safe side.
Im sure a lender with a 1st charge cannot prevent anyone else putting on a charge on the smae property. You would simply be the 2nd charge and rank lower than the 1st. It wont affect the mortgage company as they have 1st charge thus first dibs at the money, whats left goes to the 2nd charge, etc
Jasandjules said:
Are you happy to wait until he sells? I mean, what if he dies? Title could pass to someone else in his will? I'd be inclined to also put in a clause to be able to force a sale under certain circumstances (can you say that you will never need this money?).
I think in the main the mortgage company will also be ranked first and I suspect they will have a clause that says that no-one else can have a charge without their consent, however that is his/their problem, not yours. They would have to go after him for any loss. I'd certainly try and ensure you are paid out first......... If not possible, then ranked pari passu with the mortgage co.
Cost? Shouldn't be more than £150 or so, a local firm could well charge a lot less.
I suspect the forms you might want are here
http://www.landreg.gov.uk/publications/?pubtype=49
Though the solicitor should have a copy. Your mate will of course need to sign it.
to be honest you need more than just the form - you should also make sure the debt is documented properly and tied in to the charge over the property. please do get some proper advice.I think in the main the mortgage company will also be ranked first and I suspect they will have a clause that says that no-one else can have a charge without their consent, however that is his/their problem, not yours. They would have to go after him for any loss. I'd certainly try and ensure you are paid out first......... If not possible, then ranked pari passu with the mortgage co.
Cost? Shouldn't be more than £150 or so, a local firm could well charge a lot less.
I suspect the forms you might want are here
http://www.landreg.gov.uk/publications/?pubtype=49
Though the solicitor should have a copy. Your mate will of course need to sign it.
mortgage co will tell you to bugger off if you want to get paid out first. sorry, but that's the way it is. you will be second. you will need their consent and it is your problem, although it would be a bigger problem for your friend. not a good idea in current climate to be breaching banking covenants if you want to keep your house.
have to disagree about the fees - I think £500+ is more realistic. Worth it though as it will save you having to sue a cr@p solicitor for negligence later down the line. £150 is only an hours worth of time for most high street solicitors - you really do want them to spend that little bit longer on this if you want to see your money - get your mate to pay, or at the very least add it on to the debt
superlightr said:
Im sure a lender with a 1st charge cannot prevent anyone else putting on a charge on the smae property. You would simply be the 2nd charge and rank lower than the 1st. It wont affect the mortgage company as they have 1st charge thus first dibs at the money, whats left goes to the 2nd charge, etc
while this is true to a certain extent, if you don't reach an agreement with the existing lender, you have no control over how much they can look to their charge for. E.g. If he was sneaky, he borrows more from them, which reduces your share of the equity. Legal advice is must.
MRSNEAK said:
superlightr said:
Im sure a lender with a 1st charge cannot prevent anyone else putting on a charge on the smae property. You would simply be the 2nd charge and rank lower than the 1st. It wont affect the mortgage company as they have 1st charge thus first dibs at the money, whats left goes to the 2nd charge, etc
while this is true to a certain extent, if you don't reach an agreement with the existing lender, you have no control over how much they can look to their charge for. E.g. If he was sneaky, he borrows more from them, which reduces your share of the equity. Legal advice is must.
In addition, you need to ensure that there is some form of index-linking / interest provision involved (so that the debt keeps track in "real terms" at the very least), and a provision for the charge to cover all of the costs of recovery, the charge, etc.You also want some sort of mechanism to force a sale if yours becomes the only charge; he could pay off his mortgage and never pay you, IYSWIM.
Finally, I would also look at insuring the debtor's life; you have an insurable "interest" in his life, and it can be quite cheap. When he dies, it pays out.
But, yes, again, get advice!
Debbie1414 said:
Hi, we brought our mums home a couple of years ago and now she is asking if she can have some equity out of it. As long as we can get the money back we paid for it we would be happy, would a charge on it be advisable?
Sorry not understanding;If you bought your Mum property then its yours is it not? why is the Mum entitled to equity now?
do you own 50% and mum 50% ?
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