What is a Charging Order (CO)?

A Charging Order attaches to property in the same way as a mortgage. It prevents a judgment debtor from selling property (in most cases, land) without paying the judgment creditor what is owed to them.

The charge will be for the sum you are owed and can be used for an unpaid debt of £1,000 or more. Until October 2012 a charging order could only be given, in most circumstances, if a debtor missed a repayment instalment. Now a charging order can be given at the same time as the County Court Judgment (CCJ).

You do not have to get your money immediately it can safeguard your money for the future.

The charge means that if the property is sold you will be paid first before any proceeds of the sale can be given to the judgment debtor.

A charging order does not compel the judgment debtor to sell their property. However once the charging order is in place the creditor can go back to the court and ask for the property to be sold to repay the debt.

A charging order enables you to take a realistic longer term view in relation to the repayment of debt knowing that it will either be discharged by regular instalment payments or covered by the equity arising on any sale of the debtor's property.

A charging order can also be of benefit where there is a question around a debtor's ability to comply with their contract or if there is a risk of them disposing of their assets so that you cannot protect your interest.

How to issue the application for a Charging Order

Lodge at Court:

• completed N379 form - Application for charging order on land or property
• fee of £100.00 or completed application for fee remission

information leaflets:

• EX325 - Third party debt orders and charging orders – How do I apply for an order? – How do I respond to an order?
• EX160A - How to apply for help with fees

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