A frugal life is an easy life!

It is essential, that should a bank, building society, loan company, etc. be requesting a charging order through the court system in England and Wales, that you defend against it!

When a charging order is sought after, it secures an outstanding debt against your own home. You will be told that "its just a formality before we accept your proposed monthly payment arrangement" - which is all well and good, but if your payment is missed, then the company can enforce the charging order, to demand the full outstanding balance immediatly, in effect forcing the sale of your home to pay off your outstanding balance.

Under normal circumstances, with a large debt, this appears a good option, giving you more time to pay, with no interest (from the date of your court case) and no more of those £25 letters reminding you that you owe them money (unenforceable under common law).
Problems arise, when a more common practice is, for unscrupulous agents and solicitors representing these banks/building societies, are using them to pressure people owing relatively small amounts. These agents are telling people that the charging order will not be actioned, when it comes before the court, if unopposed, they seek immediate enforcement, which could cost you your home!

A few practical steps you can take to help your case:

• ALWAYS have the case transferred to your local court - bulk clearing courts (in Northampton for example) grant a large amount of charging orders despite written objections from the defendant - There have been reports all over the internet about a loan company who have been using one particular local court in the south of England, which finds against the defendant on a high percentage of its cases!
• ALWAYS argue against paying costs - highlight any delays the company have created in bringing the case to court (ie, sending reminders which they charge you for, even after you have been told it will be going to court!).

The process has reached your local court, prepare a simple (but polite) defence, print three copies, one for yourself, one for the claimants and one for the court's reference.
It is essential that you attend the court in person!
Here are some useful points to highlight to the court, to argue against the charging order being granted:

• Payments promised by you, are up to date - list briefly how much you have paid and dates when they were paid. (Remember: a company cannot refuse any payment offer from yourself - despite what their advisors tell you. Once you default, then start paying an amount that you can afford on a regular basis, even if it is refused as "not being enough" by the company.  When it comes to court, this will look better to the judge and help your case.)
  Respectfully draw the court's attention to the case of Mercantile Credit Company v Ellis 1987 (Google it to read the case findings in full) in which the judge ruled that a court has to first issue a judgement and this must be in arrears before a charging order can be granted.
• Unfair priority over other creditors - list for the court other creditors you are paying by instalments.
  Chances are if you are struggling with one loan etc, you will have a couple more that are demanding money from you. Pay them all the same amount each month and list the monthly amount you pay them here for the judge. I am assuming you have the common sense to be offering the same level of payment to the claimant in your case?
  Respectfully make the court aware, that should a charging order be granted in this case, your other creditors would be "unduly prejudiced" and this would put them at an unfair disadvantage (Ref: Charging orders act 1979)
• The orginal loan was "unsecured" - this should apply to everyone, as a charging order is a way of securing the debt against your home. Payments have been made on your account, at a higher interest rate, as the loan, debt etc, was unsecured. Had the debt originally been "secured" it would have incurred a lower rate of interest. The company was happy to provide the loan etc, without security when it was taken out.
• Family hardship - if any person lives in your home, who have no connection with your debt, then highlight to the court that should a charging order be granted and your house is sold, this would cause undue hardship for other people not connected with your debt. This can be very effective if you took out your finance in your name only and not in joint names with your partner!
• Original amount proposed has not been objected to - not everyone can use this.
  When you were sent the allocation questionnaire, when the court process started, if the company did not object to your low payment amount you proposed, but instead said they would agree to it on condition that they secure the debt against your home, then point out to the court that "the company have not objected to the payment amount you proposed."

My apologies for this long winded post, but it angers me when people get pushed around and suffer at the hands of reputable high street banks/building societies/loan companies, etc and their agents, who do not give a monkeys about real people!

Should you win your case to not have a charging order placed on your property, then it will stand you in a great position should any other company attempt to have one placed on your property - in effect, it cannot be granted as the courts have already refused one company and this would disadvantage another party, against the charging orders act 1979.
Keep smiling...

* IMPORTANT:
The information given here, is from my own personal experience only.
It is posted to give ideas to visitors and to be a point of reference for myself, should my help be needed in this area in the future.

This post IS NOT legal advice and should not be treated as such.
I'm sure I don't need to point this out, but I would always advocate that you should speak to someone who is legally qualified to give legal advice, especially in the case of a charging order, as your home could be at risk.