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Joshua, Lawyer
Category: Property Law
Satisfied Customers: 26070
Experience:  LL.B (Hons), Higher Prof. Dip. Law & Practice
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I provided a Loan to my father £80,000 for

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I provided a Loan to my father for approximately £80,000 for him to acquire a property in July 2014, and he agreed in writing that he would repay the loan by January 2016. In October 2014, he separated from his wife and she has now placed a matrimonial home rights notice on the property which was in the sole name of my father and she only lived there between July 2014 and October 2014. Divorce proceedings have started and I want to obtain advice if I can place a charge on the property for the £80,000 owed to me as the property currently has no mortgage.
Hello and thank you for your question. I will be very pleased to assist you. I'm a practising lawyer in England with over 10 years experience. I note you obtained an agreement in writing with your father. Was this a formal loan agreement please or was it just an informal exchange of letters or something similar?Finally if you have a formal loan agreement did you provide for security for the loan against the property - i.e. essentially a private mortgage to underwrite the loan?
Customer: replied 3 years ago.


It was a formal loan agreement in the presence of a witness. In the agreement it was written that if the loan was unpaid by January 2016, then he would agree to provide an equity share in a different property which is owned by him and his wife or raise finance otherwise.

Thank you - and there is no provision for a mortgage to be taken by you over the property?From what you you say your father is the sole legal owner of the property? Is he willing to assist you in registering a notice on the property or woud he resist this?
Thank you - and there is no provision for a mortgage to be taken by you over the property?From what you you say your father is the sole legal owner of the property? Is he willing to assist you in registering a notice on the property or woud he resist this?
Customer: replied 3 years ago.

Sorry I dont understand what you mean by "and there is no provision for a mortgage to be taken by you over the property?"

My father is the sole owner of the property and he is willing to assist in registering a notice on the property

Sorry to be clearer - there are essentially two different types of loan agreements; unsecured loans and secured loans. Secured loans require security over property, the most common of which would be a mortgage. Unsecured loans are made without the requirement the security, the most common of which might be an unsecured personal loan you get from a bank.The same principles apply to private loan agreements and your loan agreement may or may not provide you with a right to take a security against your father's property for the loan. You know if there was a clause in your loan agreement that provides that you may take out a charge against his property?
Customer: replied 3 years ago.

The loan agreement stated that my father's share Property B (owned by father/wife) would be provided as security however now with divorce proceedings have started - there is little chance that anything could be registered against it as it is jointly owned. However Property A is my fathers name without a mortgage, but with a home rights notice, and my father is willing to register a charge to the value of £80,000 against the property if there is means of doing so.

Thanks. Finally did his wife also sign the loan agreement or just him?
Customer: replied 3 years ago.

No, it was only signed by him

thank you. Based on what you say, if your loan agreement provides that you may take security in respect of your father's main property, then you could take what is known as an equitable charge over his property on the basis of the document. An equitable charge (mortgage) is different to a legal charge (mortgage) in that it only affects and binds your father's equitable share in the property. It does not bind the legal title nor his wife's equitable share of the property. an equitable charge cannot be registered expressly at the land registry however there it can be protected by a form A restriction which is unlikely to be of great practical value so is unlikely to be worth pursuing as you suggest. your father could if he is prepared to cooperate, grant you a charge over the property he purchased using your money voluntarily. This would be registrable at the land registry regardless of the matrimonial home's notice is wife is lodged. Alternatively, if your father is not willing to cooperate or you do not wish to pursue registration of a legal charge over the property, you could alternatively register a notice against the property that money is due to you from the equity in the property. The notice can be registered either with the consent of your father or unilaterally by you. in the case of a notice being registered unilaterally, you will need to produce evidence to the land registry of your entitlement in the form of your land agreement. You can register a unilateral notice using the following form: your father is willing to agree for you to register notice, you can register and agreed notice using the following form instead: If your father is willing to agree, you could place a charge on the property with his consent to underwrite the debt owed to you depsite the matirumonial notice. You can apply for a charges in the following form though you may wish to retain a solicitor to assist you with the registration: in either case, a notice will warn any potential buyer of the property of your interest in the matter will need to be dealt with prior to any sale proceeding. your father's wife will not be able to claim any equity in a property that belongs to you as opposed to your father pursuant to any divorce proceedings. I hope the above is of assistance? If you have no further questions for now I should be very grateful if you would kindly take a moment to click to rate my service to you today or just reply back to let me know if the above is helpful. Your feedback is important to me. If there is anything else I can help with please reply back to me I'd be very grateful
Customer: replied 3 years ago.


Thanks for your detailed response. I just have one query - as my father is willing to cooperate - you mention either a CH1 or an AN1 could be lodged - however I am unsure of which one is more appropriate to me?

I'm glad I could hear some assistance. A charge (CH1) has more value than a notice (AN1). a charge cannot be removed without your consent and provides a means for you to seek to force a sale of the property through the court if payment is not forthcoming under the loan. A notice on the other hand is little more than a notice to any potential buyer that you claim an interest in the property. It can be removed without your consent but in practice it will have value because it will be a notice to any potential buyer of the property that you claim an equitable interest in the property and no sane buyer would proceed to purchase such a property without clarifying the position fully (and no solicitor nor mortgage lender would let them) because they would potentially find themselves owners of the property on which they do not own all the equity so it does have value in practice. I hope the above is helpful? Can I help you with anything else or has the above answered your questions satisfactorily? If you could drop me a quick message to let me know I'd be very grateful.
Have I been able to help you with all your questions on the above?
Joshua and other Property Law Specialists are ready to help you
Customer: replied 3 years ago.


Thanks for your help yesterday. Do you offer services to complete the necessary procedures to lodge the form with the land registry or should I just contact a property law solicitor?

I am not able to formally act for you but I can prepare the necesary form(s) to enable you to make the application yourself if that is of assistance. If you would like help with this once you have decided which approach to take, do let me know and I will be able to suggest a fee.
Customer: replied 3 years ago.

Hi Joshua

Thanks for your message. Apologies for the late reply. Yes, if you could help to prepare the forms then that would be fine. Please le me know of the fee payable. thanks

I would be delighted to. Could you kindly advise which route you would be proceeding under - with your fathers cooperation or without it?
Customer: replied 3 years ago.

Its with my fathers cooperation.

Thank you. On that basis if there is no other mortgage on the property which I believe is the case from what you say they ideal position would be to take a charge on the property. In order to do so I would need to have sight of the registry entries for the property, a copy of your loan agreement and prepare the charge documentation. I would suggest a fee of £125 to complete the work which would include provision of detailed instructions and any follow up questions you have in relation to making the application. If you would like to proceed, please let me know and I will create an additional services offer so we can transfer to direct email contact.
Customer: replied 3 years ago.


I am happy with the fee mentioned. Please let me know on how we can proceed with the email contact.

Many thanks for the above. I will create something called an "additional services offer". Please note that although I am based in England, the site is US owned and so I must denominate in US dollars so the balance may not be exactly £125 depending on currency exchange rates. The offer should appear in a few moments. Once accepted we will exchange email contact information so you can provide me with the information I need confidentially to prepare the proposal deeds and application documentation.
Customer: replied 3 years ago.


I have accepted the offer. Please find my email below.

Many thanks. My email should be visible. If not you may have to refresh the page. if you can kindly drop me an email, I will respond asking for the information I need. I look forward to hearing from you