Charging Order

It works like this: Once a creditor has secured a County Court Judgment against you, they can apply for a Charging Order as a means of enforcing the debt. At the moment creditors are not allowed to ask for a Charging Order if you have already agreed with the court to repay the debt by installments and you are not in arrears, but the law is expected to change soon, enabling creditors to obtain an order even if you haven't fallen behind with your payments.

Nevertheless, if a Charging Order is granted the first thing that will happen is that a note will be entered on your property details at the Land Registry flagging up a restriction on your power to sell or remortgage the property.

If the creditor is then happy to sit back and wait for his money, nothing further will happen until you try to sell up, at which point any equity realised in the property will be used to pay back any loans secured against the property.

But, if the creditor wants his money immediately after acquiring a Charging Order, he can then apply to the court for an Order for Sale. If granted then the procedure works just as if you were having your home repossessed - the house will be sold, the creditor gets his money and you're homeless.