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can anyone explain please?

A charging order is a charge put against your land (property) and lodged at the land registry office. Most are awarded by the court. Some are entered by a creditor after you take out a secured loan against your property e.g. a mortgage

9.101 Introduction
A charging order is defined by the Charging Orders Act 1979 (the COA), section 1. Under the COA, section 1, a creditor may apply to the court for an order imposing a charge on any property, specified in the COA, section 2, (see paragraph 9.104), of the debtor to secure payment of any money due. The court will only make a charging order having considered the personal circumstances of the debtor and whether any other creditor of the debtor would be likely to be unduly prejudiced by the making of the order (COA, section1(5)).

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Quite simply a charging order gives an ordinary unsecured creditor the ability to get security for its debt, by registering it against the equity in your property. This then gives the creditor secured status, and you will have to agree a repayment programme with the creditor to persuade them from taking possessory action. Think of it as a second mortgage if you like!

When you come to sell the property, the charge will be discharged in full from the proceeds of sale, after any prior chargeholders have been paid.

Regards, Melanie Giles, Insolvency Practitioner for over 20 years.

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