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Aston Lawyer
Aston Lawyer, Solicitor
Category: Law
Satisfied Customers: 10733
Experience:  Solicitor LLB (Hons) 23 years of experience in Conveyancing and Property Law
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I lent a friend some money to cover his debts. He was suing

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I lent a friend some money to cover his debts. He was suing somebody and we agreed in writing that I would be paid on a set date (which has now passed) either on his litigation proceeds or out of the ale of his house. He lost the case so now I only have the agreement to pay me on the house sale. I've become concerned that his debts may be greater that he told me and that the sale proceeds might be at risk.
How can I bets protect myself - can I register a notice or a restriction against the title. Alternatively, if I issue proceedings can the fact of that action be registered? Or anything other route?

Hello and thanks for using Just Answer.

My name is ***** ***** am happy to assist you with your enquiry.

There are various options available to you. Please note that whichever option you take, your financial interest in the property ranks behind any registered Charge or Restriction there may already be on the property. A registered Charge means any Mortgage or secured loan your friend has and if he has got himself into financial difficulties, some creditors may have registered a Restriction against his title, meaning the monies due to them would need to be repaid upon any Sale.

Depending on what you decide to do, you may want to obtaina copy of his title (called "Official Copies") from the Land Registry website, which you can obtain for a nominal sum. Please note the title will only show what Charges are already registered and you won't be able to find out how much is outstanding under these Charges. Land Registry link-

From your point of view, the best thing you can do is to register a Restriction against the property. This will basically mean that your consent will need to be obtained by your friend before any Sale completes. It also means you can hold off signing this consent until you have confirmation from your friend's Solicitor that he will pay you on completion. If your friend agrees to you registering a Restriction, you can make this application (Land Registry Form RX1) straight away.

You will also need to know which restriction is most suitable. The charge is £40 for a standard restriction of £80 for one of your own. Here is a practice guide to help you with this.

I would suggest standard Restriction Form N.

If you do issue Court proceedings against your friend for the sum owing, this won't in itself put you in a better position than you are now. Only once you have obtained judgment against your friend, can you then re-apply to the Court for a "Charging Order" which is basically then registered against the title and acts in a similar manner to a Restriction, in that you would need to be notified before any Sale completes.

If your friend does NOT agree to let you place a Restriction on the title, your only option would be to either obtian the above mentioned Charging Order or you can register a Notice against the title. A Charging Order in this scenario would be best, ***** ***** your consent would be needed before any Sale completes. As regards ***** ***** this merely obligates the Seller to notify you of any Sale, but your consent is not required for the Sale to proceed to completion.

You may wish to speak to a local Conveyancing Solicitor as regards ***** *****

I hope this assists and sets out the legal position.

Kind Regards


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