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Charging orders

About charging orders

If your creditor has taken you to court for a debt, they may have a county court judgment (CCJ) or other court order against you. This is where the court orders you to pay back the money you owe. A court  order means you have to either make regular payments to your creditor or pay the whole debt off by a certain date.

If you don’t keep to the terms of the court order, your creditor has a number of other options to try and make you pay. One of these is to get a further court order called a charging order. A charging order secures the debt against your home or other property you own. This makes the debt very serious. It means that you could lose your home if you don't pay back what you owe.

Once a charging order has been made, your creditor can apply to the court for another order to force you to sell your home. This is called an order for sale.

This page tells you about when a creditor can apply for a charging order, what happens when they apply and if they try to force you to sell your property.

If your creditor tries to get a charging order, you should get urgent help from a specialist debt adviser at your local Citizens Advice Bureau. To search for your nearest CAB, including those that can give advice by e-mail, click on nearest CAB.

For more information about CCJs and court orders when you owe money, see You are taken to court for debt.

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When can a creditor apply for a charging order?

Your creditor can only apply for a charging order if they've already got a county court judgment (CCJ) or other court order against you.

The rules about when a creditor can apply for a charging order changed from 1 October 2012. Before you start, check:

  • the date your creditor applied for the original CCJ
  • the date the CCJ was granted
  • what the CCJ says about repayments.

A creditor must take you to court to get a charging order.

Before 1 October 2012

If the creditor applied for or was given a CCJ before 1 October 2012, they can only apply for a charging order if the CCJ says you must pay:

  • the whole debt immediately or by a certain date, called a forthwith judgment, and you haven't done this; or
  • by instalments and you’ve missed one or more payments.

If the creditor applies for a charging order when you haven't broken the terms of the CCJ, go to the hearing where the charging order is made and show evidence to the judge that you have kept to the terms of the original court order.

From 1 October 2012 onwards

If the creditor applies for or is given a CCJ against you on or after the 1 October, they can apply for a charging order straight away. This applies even if you are up to date with payments under the CCJ.

If the CCJ was made before 1 October 2012 but the order to pay by instalments was made or asked for on or after 1 October, the creditor may argue that they can apply for a charging order straight away. Some judges may accept this argument even though the original judgment was made before 1 October. This is a ‘grey’ area and you may need to get advice about what to do.

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What is a charging order

The application for a charging order always has two stages. These are an interim order and a final order.

An interim charging order is usually granted by the court to stop you from selling your property before the final order can be made without your creditor knowing.

If a court grants your creditor a final charging order, this means that if you sell your property, you must pay your creditor back out of the proceeds.

If your creditor gets a final charging order, this doesn't mean you will have to sell your property. If your creditor wants to force you to sell your property, they will have to apply to the court for a further order called an order for sale.

You can argue against your creditor being given a final charging order or an order for sale. You can also ask for conditions to be attached to a final charging order which make it harder for the creditor to force a sale.

Interim charging orders

An interim charging order is usually made automatically and a copy will be sent to you. The court will decide at this stage when a full hearing will take place.

An interim charging order does not mean that a charging order has been made against you. There will need to be another hearing for a charging order to be made final and you will still have an opportunity to argue against it.

At the hearing the court will decide whether or not to make the interim charging order final. It's very important you attend this hearing.

The date for the final hearing should be at least 21 days after you've received the interim charging order. This is to give you time to prepare any arguments you want to make about why the charging order should not happen.

If you want to object to the final charging order, you must send the court and your creditor written evidence setting out your arguments. You must do this at least seven days before the court hearing. Send all your documents by recorded delivery so you have a record if anything gets lost.

When your creditor applies for an interim charging order, they must give evidence that you own the property they want to get a charging order on, confirmation that you are in arrears with your CCJ and also details of all the other creditors they know about.

If they haven't got the information they need, they may take you to court to get an order to obtain information. If you are asked to go to court, you will have to answer lots of questions about your financial situation and swear on oath the information you give is true.

For more information about how a creditor can get an order to obtain information, see How a creditor can get information about your finances.

When your creditor applies for an interim order, they will also register a charge on your property at the Land Registry. This means that the property can’t be sold without your creditor knowing about it.

If you can pay back the debt in full at this stage, you can get the charge removed from the Land Registry.

You can get advice about getting a charge removed from the Land Registry from your local Citizens Advice Bureau. To search for details of your nearest CAB, including those that can give advice by e-mail, click on nearest CAB.

Final charging orders

There will be a court hearing to decide whether a final charging order should be made.  

You must go to the hearing. If you don’t go to the court hearing, a final charging order will be made automatically.

At the hearing, the judge will look at the evidence you have sent in to say why you don't want a charging order to be made.

They will also look at the arguments made by your creditor.

After considering the evidence from both sides, the judge will decide whether to make a final charging order.

If a final charging order is made, your creditor can either wait until you sell your  property or apply to the court for an order for sale. They must apply for an order for sale if they want you to sell your property straight away.

There are several arguments you may be able to use to persuade the judge not to grant your creditor a charging order.

You may also be able to persuade the judge to attach conditions to the charging order which mean that your creditor can't force you to sell your property or which make it harder for them to do this.

You can get help to put your arguments to the court and to ask for conditions to be attached to the charging order from an experienced adviser at your local Citizens Advice Bureau. To search for your nearest CAB, including those that can give advice by e-mail, click on nearest CAB.

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Can you stop a final charging order being made

At the hearing for a final charging order, the court must consider all the circumstances of the case before it decides whether to make the order and your personal situation is very important.

You may be able to use one of the following arguments to persuade the judge that a charging order should not be made.

There is very little or no equity in your property

Equity is the amount of profit you would make on your property when you have sold it and the mortgage has been paid off. If there is little or no equity in the property, your creditor wouldn’t get their money back if it was sold. This might apply where a mortgage or other secured loans have to be paid back first or where the value of your property is low.

Other creditors aren't asking for a charging order

If you have more than one creditor, the others may have agreed to let you pay back their debts by instalments, rather than asking for a charging order. You may be able to argue that you shouldn't have to grant one creditor a charging order if none of the others think it's necessary – especially if the others are owed more money.

Other creditors have priority

You may have other creditors who would need to be paid back first out of the proceeds of the sale of your home. This might leave little or no money to pay back the creditor who is asking for a charging order, so there would be no point in them getting one.

A charging order is unfair on other people who live with you

You may be able to argue that other people who live with you, such as children, an older person or someone with a disability, would be severely affected if your home had to be sold.

There are other ways to pay back the debt

It may be possible to argue that there are other ways to pay back the debt than through a charging order. Some of these may be better for you, depending on your circumstances.

Other ways of paying back the debt include:

  • an instalment order, where you pay back what you owe in instalments  
  • an attachment of earnings order, where the money you owe is taken out of your wages. This would only be useful if you are employed and your job isn't at risk
  • an administration order. You could ask for this if you owe credit debts of less than £5,000 to more than one creditor. An administration order allows you to make one regular payment to the court. The amount of the payments  depends on what you can afford to pay. The court then divides the money up and pays your creditors what it thinks is the fairest amount. As long as you keep making the payments, your creditors can't take any further action against you, although they can ask for the decision to be reviewed
  • a time order. This is an order that extends the length of time you have to repay the debt. You can also change the amount you pay each month. Time orders are particularly useful if you want to stop or reduce the amount of interest you are paying on top of your debt. Time orders are only granted on credit debts such as a credit card or other loan.

There may be other arguments you can use to persuade a judge not to grant a final charging order, so make sure you get advice from an experienced debt adviser before the hearing.

For more information about attachment of earnings orders, see Creditor takes money from your bank account.

For more information about administration orders, see Options for dealing with debt.

You can get help to present your case at a charging order hearing from an experienced adviser at your local Citizens Advice Bureau. To search for details of your nearest CAB, including those that can give advice by e-mail, click on nearest CAB.

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What can you do once a final charging order is made

If the court decides to grant a final charging order, you may be able to:

  • apply for the order to be set aside
  • ask for conditions to be attached to the charging order
  • get the charging order changed.

Applying for the charging order to be set aside

If a final charging order has been made, you may be able to apply to the court to have it set aside. This means the debt goes back to the judgment stage and your creditor will have to reapply to the court if they want to take further action. This can give you more time to repay your debt.

You can only do this if you think the court didn't consider your circumstances properly. You must make this application as soon as possible after the charging order is made final.

To make the application, use court form N244. You can download court forms from the Ministry of Justice website at: www.justice.gov.uk.

It can be very difficult to get the charging order set aside. You can get advice on what to do, including help to fill in the court form, from an adviser at your local Citizens Advice Bureau. To search for details of your nearest CAB, including those that can give advice by e-mail, click on nearest CAB.

You may need specialist help to put your arguments to the court and to ask for conditions to be attached to the charging order. You can get advice on this from your local Citizens Advice Bureau. To search for your nearest CAB, including those that can give advice by e-mail, click on nearest CAB.

Asking for conditions to be attached to the charging order

You may be able to persuade the judge to attach conditions to the charging order, which mean that your creditor can't force you to sell your property straightaway. For example, you can ask for:

  • your property not be sold while your children are still at school, or
  • the final order to be suspended as long as you keep to an agreed repayment plan.

There may be other conditions you can ask for, depending on your personal circumstances.

You may need specialist help to put your arguments to the court and to ask for conditions to be attached to the charging order. Your local Citizens Advice Bureau can put you in touch with people who can advise you. To search for your nearest CAB, including those that can give advice by e-mail, click on nearest CAB.

Getting a final charging order changed

If the charging order has conditions attached, you might be able to ask the court to change them if your financial circumstances change.

For example, the charging order may say you have to pay back your creditor in instalments. You can ask the court to change the amount of the instalments or the date the final instalment has to be paid.

For more information about getting a court order changed, see Changing a court order for debt.

You can get advice about how to get a charging order changed, including help filling in the court form, from an adviser at a Citizens Advice Bureau. To search for your nearest CAB, including those that can give advice by e-mail, click on nearest CAB.

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What happens if there's an order for sale

Once they've been granted a final charging order, your creditor can apply for an order for sale. This is a court order which forces you to sell your property and pay your creditor back what you owe them out of the proceeds of the sale. From 6 April 2013, a creditor can't get an order for sale if the debt is less than £1,000. There's no lower limit for applications made before 6 April.

There will need to be another court hearing, which it is very important for you to attend. It is up to the court to decide whether to make an order for sale or not.

Why does a creditor decide to apply for an order for sale

Once they've got a charging order, some creditors will be prepared to wait for you to sell your home whenever you're ready, at some point in the future. However,  others will apply for an order for sale straight away. This could be the case even if you owe them a fairly small amount of money compared to the value of your home.

Whether or not a creditor is prepared to wait, depends on how quickly they want their money back. They may also take one or more of the following things into consideration:

  • whether you can pay the money back within a reasonable time in another way. For example, you may be able to make regular payments or raise a lump sum to clear the debt. But if you were given time to pay the money back when the final charging order was made and you haven't kept to your agreement, they will probably apply for an order for sale
  • whether there are other mortgages or secured loans to be paid off first, out of the proceeds of the sale. If there are other debts that need to be paid off first, your creditor may not gain anything by forcing you to sell your home
  • how much equity there is in the property. Equity is the amount of profit you would make on your home once the property is sold and the mortgage is paid off. If there is little or no equity in the property, it may not be worth the creditor forcing you to sell your home
  • if they think you have deliberately refused to pay back the debt even though you're able to
  • whether they think forcing you to sell your property is the only realistic way of getting their money back.

How will the court decide whether to grant an order for sale

If your creditor does decide to apply for an order for sale, you will be asked to go to court. It’s very important that you go to the court hearing so they know about your situation.

Try to get some advice as early as possible before the day of the court hearing for the order for sale. If you can, take a legal representative with you such as a specialist adviser. You may get help with your legal costs.  

The legal situation can be very complicated and you may be able to make a number of legal and personal arguments why the property shouldn’t be sold.

The court can order a sale where:

  • the debt is in your sole name and you are the sole owner of the property, or
  • the debt is in both the names of the joint owners of the property.

If the debt is in your sole name and the property is in joint names, the creditor can apply for an order for sale to realise their interest in the property. Your creditor will have got an interest in your share of the property when the final charging order was made.

If there are joint owners of the property but the debt is only in your name, it may be more difficult for the creditors to get an order for sale. That's why it's really important for all joint owners to go to the court hearing for the order for sale, so they can explain their situation. This includes a husband or wife who is not a joint owner, but who will have a beneficial interest in the property.

The court can decide that it's unfair to force someone who wasn't responsible for the debt to leave their home.

It will also look at the interests of the whole family and decide whether or not these are more important than those of the creditor. Some of the things it will take into account include:

  • is there enough equity in the property to pay off the mortgage, and the charging order debt? If there isn't, it may not be worth forcing you to sell your home
  • the reasons you bought your home. Is it intended as a long-term family home, or that an older person will live there for their lifetime?
  • the welfare of any children. Are there any special things to consider such as age, disability or illness? What would be the effect on the children of moving and is there a need for stability at school
  • there are other ways you can pay back the debt, such as with an instalment order, administration order, or an attachment of earnings order.

If any of these things apply to you, you should make sure that the court knows about them.

You can still make an offer of payment at this stage and ask the court not to order a sale as long as you keep up with the payments. You should provide a full financial statement of your circumstances. You can ask the court to adjourn the order for sale proceedings, or to suspend the order.

For more information about providing a financial statement, see How to work out your budget. You can also use our online budgeting tool to fill in a financial statement.

What if the court makes an order for sale

If the order for sale is made and not suspended, you will normally be given 28 days to pay the debt or leave the property. If you don't pay the debt or leave the property within 28 days, your creditor can apply for an order to force you to leave the property. This is called a warrant of possession.

If you do lose your property, you might need advice about getting re-housed.

For more about what happens if there's a warrant of possession for your property, see Mortgage problems.

For more information about finding accommodation and being re-housed, see Finding accommodation.

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How does a charging order affect the people you live with?

If you have joint ownership of your property with someone such as your husband, wife or civil partner and the debt is in both your names, the court will be able to make a charging order or an order for sale on the whole property.

If the debt is only in your name and the property is in joint names, the court can only make a charging order on the share of the property you own.

Other people who live with you, such as a husband, wife or partner who don't own the property, will be able to declare a beneficial interest in the property. This means the court must think about how making a charging order or an order for sale will affect them.

The court needs to think about how making a charging order will affect all the people who live with you and whether this will cause them hardship or suffering. This may make it less likely that the creditor will get a charging order or an order for sale. That's why it's very important for the court to know about these people.

It's also very important for the people you live with to know about the court hearings. A joint owner, husband, wife or civil partner should be given the chance to go to the court hearing and tell the judge how a charging order will affect them or any family members living with them.

Things that the person you live with might want to tell the court include:

  • why they should not lose their home when they don't owe the debt
  • there are children, or an older or disabled person living in the property. You can ask the court to make it a condition of the charging order that the property can't be sold until the children have grown up.
  • the need to stay close to work or school and the difficulty of finding suitable accommodation to move to in the area
  • if they paid for the deposit to buy the home
  • if they've been making the mortgage payments.

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Paying off a charging order

If you pay off the amount you owe under the charging order, you can apply to the court for the order to be discharged. Ask the court for a certificate of satisfaction on your county court judgment and include evidence of payment.

You can then use the certificate to get the Register of Judgments, Orders and Fines changed. This should make it easier for you to get credit.

It is usual for creditors to inform the Land Registry that the interim and final charging order have been discharged.

For more information about changing an entry in the Register of Judgments, Orders and Fines, see How county court judgments affect your credit rating [Adobe Acrobat Document 41 KB].

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Further help

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