Guarantor won't pay. Bankruptcy?

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    Guarantor won't pay. Bankruptcy?

    Hi

    I am owed around £1500 by a guarantor of one of my ex-tenants. I have a CCJ against him and he then applied for a variation order. He was granted the right to pay me £60 per month.
    I have not received the first payment. I now know that he has a slippery history and suspect that he would not grant a bailiff entry to his house, which he co-owns with his wife. I am considering stumping up to apply to have him declared bankrupt but am concerned that he will then pay up £60 thus annulling my application and I will have to repeat the process every month. As it will probably cost me £100 a time to get a process server to serve notice then this would not be sensible.

    Has anyone on the forum gone through the bankruptcy process please and how did it work out?

    thanks

    #2
    Obtain a Charging Order, then register a Restriction [form K] against the jointly-owned house.
    JEFFREY SHAW, solicitor [and Topic Expert], Nether Edge Law*
    1. Public advice is believed accurate, but I accept no legal responsibility except to direct-paying private clients.
    2. Telephone advice: see http://www.landlordzone.co.uk/forums/showthread.php?t=34638.
    3. For paid advice about conveyancing/leaseholds/L&T, contact me* and become a private client.
    4. *- Contact info: click on my name (blue-highlight link).

    Comment


      #3
      Thanks for the quick reply. My understanding is that since 2003 it is not possible to get a charging order as his wife is not a party to the guarantee and that restrictions now have little effect. Unfortunately I cannot find the document that I read about this.
      Is it possible to charge interest on a sum of less than £5000 as I suspect they won't move in a hurry?

      thanks again

      Comment


        #4
        Originally posted by JohnnyNoHair View Post
        Thanks for the quick reply. My understanding is that since 2003 it is not possible to get a charging order as his wife is not a party to the guarantee and that restrictions now have little effect.
        You can obtain a Charging Order against HIS beneficial interest, even though not against hers. Form K can then be registered against their jointly-owned property which cannot be sold unless your debt is paid in exchange for you releasing the Restriction.
        JEFFREY SHAW, solicitor [and Topic Expert], Nether Edge Law*
        1. Public advice is believed accurate, but I accept no legal responsibility except to direct-paying private clients.
        2. Telephone advice: see http://www.landlordzone.co.uk/forums/showthread.php?t=34638.
        3. For paid advice about conveyancing/leaseholds/L&T, contact me* and become a private client.
        4. *- Contact info: click on my name (blue-highlight link).

        Comment


          #5
          Dear Jeffrey

          I really appreciate your advice. Acknowledging the risk that I am teaching my grandmother how to suck eggs, I would be grateful for your comments on the advice found on:

          http://www.opportunities.co.uk/artic...tive-security/

          which includes the following regarding charges on jointly owned property:
          However, if the property was jointly owned by the debtor with other non debtors, for example husband and wife owning the property and only one of them being the actual debtor, the creditor was not entitled to enter an “agreed notice”.

          Instead the creditor could only file a “restriction” in the following terms:

          “No disposition of the registered estate is to be registered without a certificate signed by the applicant for registration or his conveyance that written notice of the disposition was given to [creditor] being the person with a benefit of an interim/final Charging Order on the beneficial interest of [name of debtor]”.

          This restriction was and remains, practically useless.
          Thanks once more.

          Comment


            #6
            It's accurate. The point of such Restriction is to tell the creditor that sale proceeds may be available.
            JEFFREY SHAW, solicitor [and Topic Expert], Nether Edge Law*
            1. Public advice is believed accurate, but I accept no legal responsibility except to direct-paying private clients.
            2. Telephone advice: see http://www.landlordzone.co.uk/forums/showthread.php?t=34638.
            3. For paid advice about conveyancing/leaseholds/L&T, contact me* and become a private client.
            4. *- Contact info: click on my name (blue-highlight link).

            Comment


              #7
              Ok , so he will not have to pay me before he can dispose of the property but he has to tell me that he has done it so I can then chase him again and presumably threaten him with bankruptcy. Not ideal but cheaper than pursuing bankruptcy at this stage.
              Am I entitled to interest? It could be many years until the property is sold?

              thanks again.

              Comment


                #8
                I believe you are - 8% I think.

                This is based on a conversation recently with a landlord owed over 10k for damages (reduced to half as the inventory was written by him, not an independent body if you can believe it). He has a charging order and I believe he has tried to force the sale.
                Liability statement. My liability to you is not to exceed the amount you are paying for my recommendations or advice.

                I see a bright new future, where chickens can cross the road with no fear of having their motives questioned

                Comment


                  #9
                  Originally posted by JohnnyNoHair View Post
                  Ok , so he will not have to pay me before he can dispose of the property but he has to tell me that he has done it so I can then chase him again and presumably threaten him with bankruptcy. Not ideal but cheaper than pursuing bankruptcy at this stage.
                  Well, not quite. P's solicitors [PS] will want to ensure clear title; so they're likely to require an Undertaking from V's solicitors [VS] (on completion) to procure removal of the entry. VS contact you; you tell them how much is due; they pay you, out of funds received from PS; and you sign 'removal' form.
                  JEFFREY SHAW, solicitor [and Topic Expert], Nether Edge Law*
                  1. Public advice is believed accurate, but I accept no legal responsibility except to direct-paying private clients.
                  2. Telephone advice: see http://www.landlordzone.co.uk/forums/showthread.php?t=34638.
                  3. For paid advice about conveyancing/leaseholds/L&T, contact me* and become a private client.
                  4. *- Contact info: click on my name (blue-highlight link).

                  Comment


                    #10
                    Great. One final question. Can I claim interest on a debt of less than £5000( I have some recollection that I cannot) and do I need to ask for it when I apply for the charging order?

                    thanks

                    Comment

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