Lenders given fast-track to switch your unpaid credit card debt on to your property

[AAD News Feed]

Lenders given fast-track to switch your unpaid credit card debt on to your property

This is a duplicate of the Blog Entry made on 4th October 2012 18:59.

t has become easier for credit card companies and personal lenders to recover debts from the proceeds of the house sales of struggling borrowers...

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[Never-In-Doubt]

Re: Lenders given fast-track to switch your unpaid credit card debt on to your property

Well this changes everything if they can just jump in and secure an unsecured debt against your property without even obtaining a defaulted CCJ first

Only when the borrower failed to stick to the terms of the CCJ could the creditor apply to secure the debt against their home. This is called a charging order. However, as of yesterday firms can now apply for a charging order against a borrower even if they haven’t missed any payments under the CCJ. Charging orders allow companies to secure a debt against a borrower's home. It means the money is repaid to the creditor from the proceeds when it is sold, including when the owner dies.

[Never-In-Doubt]

Re: Lenders given fast-track to switch your unpaid credit card debt on to your property

I also wonder if this means the whole rulebook, including Part 73 needs rewriting?

---> PART 73 - CHARGING ORDERS, STOP ORDERS AND STOP NOTICES - Civil Procedure Rules

Bit strange that they have allowed this based on the number of mis-issued CCJ's in existence. I reckon we need a whole new training brief setting up in order to address these changes..

[bobogosing]

Re: Lenders given fast-track to switch your unpaid credit card debt on to your property

"Lenders given fast-track to switch your unpaid credit card debt on to your property"

Ummmmm.......do we need to worry??

[Never-In-Doubt]

Re: Lenders given fast-track to switch your unpaid credit card debt on to your property

Ummmmm.......do we need to worry??

Right now everyone does cos if they can hop-skip-jump through the ccj process (i.e. not necessary) then that changes everything!

I've just spoken to Paul about it, lets wait till he's back and see what he says....

Don't worry too much just yet though - I'm sure there will be regulation surrounding it that must be followed, or most DCA's will abuse it.

[bobogosing]

Re: Lenders given fast-track to switch your unpaid credit card debt on to your property

OK!

[SXGuy]

Re: Lenders given fast-track to switch your unpaid credit card debt on to your property

Im guessing this hop skip and jump refers to people who currently have a CCJ and not just anyone with a regulated credit agreement?

EDIT: dont worry, ignore that, just re read the article. So i guess it means we need to make every oppotunity to avoid any CCJ's being issued in the future.

[vossy]

Re: Lenders given fast-track to switch your unpaid credit card debt on to your property

Sign the tories are in eh?

[transformer999]

Re: Lenders given fast-track to switch your unpaid credit card debt on to your property

"Lenders given fast-track to switch your unpaid credit card debt on to your property"

Ummmmm.......do we need to worry??

I thought that they were doing that already......I mean look how hard it is...although it is not impossible to defend against a charging order. but is very very hard....you have to have some solid and strong arguments to win. This will just make it that much more harder...and more concentration on not getting a CCJ in the 1st place is where a lot of people I expect will be concentrating on.

I know this will cause a lot to panic....as my soul temporarily left my body after reading this thread...luckily it came back just in time .

I was just thinking about all those claims that are stayed? will the lenders/creditors now rush to get lifts? in the hope that they have now been granted their wish of getting a CO on the borrowers property?

Like Niddy says lets wait to see what Paul says....as there is always more than one way to skin a cat....and I find it quite a piss take that this change in law has been made over night don't you all think? usually we hear things in the pipeline.....or some leaked info some twit left on the bus.

Maybe the law is trying to close as many loopholes as they can so people cannot find anyway of getting out of their debts...that means even if the lenders..have unenforceable agreements...as you see a bad DN is not needed anymore......

[SaltnVinegar]

Re: Lenders given fast-track to switch your unpaid credit card debt on to your property

If this has been 'rushed' through with the usual lack of thought then there will likely be errors in the process, and legal arguments to defend.

If the debt isn't in joint names, and the mortgage is, then usually a CO is worth very little anyway (depending on how its been applied for).

But it is a concern that yet more legislation is being introduced in creditors favour.

How can anyone benefit from offering a higher interest rate on a loan because its 'unsecured' and then convert it into a secured loan when it goes pearshaped is beyond me. Surely the higher interest rate reflects the risk?!

For those that weren't aware, this has been in the pipeline for some months. I saw CAB many months ago raising concerns as creditors have been abusing the CO process already.

You can imagine the DCA's rubbing their hands together as it means they can now beef up their threat-o-grams.

For me it makes things like UE even more important now to ensure that creditors don't even get the CCJ in the first place.

Best
SnV

[Undercover Elsa]

Re: Lenders given fast-track to switch your unpaid credit card debt on to your property

At least they do still have to get a CCJ in the first place. When I first read it I thought that they could go straight for a CO without a CCJ!

So the difference is that they can now apply for a CO even if you're up to date with CCJ payments.
I despair of this shitty government. Guy Faulkes night is coming up, who's in?

[PlanB]

Re: Lenders given fast-track to switch your unpaid credit card debt on to your property

My fear is that creditors will issue more speculative summons in order to get a CCJ where they know the debtor hasn't got the income to pay the judgment order, but does have a home In the past they may not have bothered with the expense of unrecoverable court fees, but this gives them an insentive.

And I presume a debt secured on a property will sell for a higher price to a debt purchaser because it has a greater potential for cashing it in one day.

Is this the end of F & Fs if creditors become happy to sit it out for the full amount when I die

[ken100464]

Re: Lenders given fast-track to switch your unpaid credit card debt on to your property

Must admit thats how I read it Elsa.

They get a CCJ but then a CO whatever you do.

Wonder if any spineless gutless politico will now insist all lending carries a warning that if you dont keep up repayments that you could lose your home or something to that effect.

And while they are about it how about cutting the obscene interest rates so they actually factor in that an unsecured therefore risky loan is now if they get into trouble going to become a less risky secured loan.

Looks like the banksters win yet again whatever you do.

[transformer999]

Re: Lenders given fast-track to switch your unpaid credit card debt on to your property

Will that mean that people will still be able to apply for a set aside if they believe that they have been given a wrong CO?

Making this new law, I expect will have an impact on everything else that surrounds CO's...set aside's...appeals etc etc. IMO....don't make no difference whose in government....as the new one just carries on with the law the old one left behind...and adds on more shite of their own.....

If lenders have been given these rights....which kinda they already had but had their heads too far up their behinds to accept lower repayments from people and were dishing out claims like confetti.

If lenders agreed to accept lower repayments from borrowers when they suffered financial difficulties....they would have saved a fortune on that alone in court fees & costs...but they found it better to pursue people through courts...in the hope they would get a CCJ against them...and then a default will occur and they can get a CO.

Good if you do not have a property in your own name as a CO won't effect you...

Another good thing for creditors also from this new law is that they will save millions if not billions in all those same templated letters they send from DCA's. I think they know that their goose is cooked in that department....as people are finding out companies like Red...Lowell....are all one company....just passing from desk to another.

But whatever happens I am sure they will have to follow some sort of guidelines and protocol.....so that is where we are have to be geared up with info too.....to make sure we don't get hammered...unknowingly.

[SaltnVinegar]

Re: Lenders given fast-track to switch your unpaid credit card debt on to your property

Is this the end of F & Fs if creditors become happy to sit it out for the full amount when I die

And this is where the hard nosed money men enter the room. So they will make a decision based upon several things:

1) The amount of time they think it likely you will be selling your home (e.g. family young children looking to upsize, older couple looking to downsize) or whether you are likely to be there the next 20 years...

2) The equity in the house (i.e. if you do sell the chances of them getting their money back)

3) Likelyhood of the CCJ being defended and chances of not being awarded (UE) so costs incurred more than the debt is worth

4) Likelyhood of the CCJ being defended and another ruling going against them

Plus many more I am sure!

This change makes it even more essential to defend a CCJ and ensuring that any determination is set at a level that is well within a debtors ability to repay so that even if a CO is granted, there should be no excuse for a creditor to make an application for a forced sale.

Its the previous point thats my real concern as well as the fact that creditors will go for judgements by default and a CO to boot.

We are all also aware of the underhand tactics some creditors use to get a CCJ by default (papers to previous addresses for example) and I can see cases where the first a debtor knows about it is they find their home is under a forced sale as they defaulted on a CCJ and CO they knew nothing about