Orders for sale - Shelter England - What is an order for sale in the UK?

Now that you’re calm, understand that the number of cases that result in an Order for Sale is minimal as it's seen as a last resort. You will also find that an Order for Sale is mainly used by mortgage lenders with the 'first charge’ on a property. This means they are at the top of the list to be paid if your house gets sold; that means even before you!

There are other instances in which a creditor may apply for an Order for Sale; however, it’s not easy for them to be granted one. In this article, we will unwrap what an Order for Sale is and help to calm your stress regarding this. We got you.

Let’s keep it nice and straightforward. An Order for Sale is a court order that means you are forced to sell your home. This doesn’t necessarily mean you must call an estate agent and put your property on the market. This means you could be given just 28 days to settle the debt, or you would have to leave the property.

Even though it sounds drastic, it’s essential to understand that there is much to consider before you get to this stage.

There are essentially four groups:

• A mortgage lender of the property – i.e., your mortgage provider. This generally applies when there has been a breach in the agreement, i.e., you’ve failed to maintain your payments.
• A trustee in bankruptcy – this is to be expected if you have chosen to make yourself bankrupt or have been made bankrupt.
• An owner in a joint ownership property – if any of the other parties with a financial interest in the property do not want to sell. This option exists for the party that wants to sell and apply for an Order for Sale.
• Finally, a creditor who has secured a Charging Order - can be anyone to whom a debt is owed. The debt could previously have been unsecured (e.g., a credit card, a loan, etc.) but is now secured through the Charging Order. As you will see, this is not a straightforward process.

how to stop an order for sale

As we mentioned earlier, this is often the very last resort. Judges have been advised not to grant an Order for Sale easily. So, even if you are on the receiving end of an application, it is not a foregone conclusion.

You need to know firstly, under what circumstances a creditor cannot apply for an Order for Sale:

• If you owe less than £1,000 and your debt is covered by the Consumer Credit Act
• If you received the County Court Judgement related to the debt on or after 1 October 2012
• If the court asked you to pay in instalments and you’re paid up to date.*

If you think that none of these apply to you, relax. We’re just getting started….

That’s not the end of it. We still have some options to share with you. They aren’t a sure thing, but they could help to influence the Judge’s decision as Judges must consider:

• Other household members: How would it impact the other household members should the Order for Sale go ahead? For example, if there are young children in the house, the damage it could do to them as a result of this drastic action. If there are any elderly or vulnerable people in the home or anyone with disabilities, the Judge must consider how granting the order will impact them, too. It’s not their fault that the situation has reached this stage. The Judge will likely stop the order unless there is a strong reason from the creditor as to why it should go ahead despite the impact it will have.

• Paying up in a reasonable amount of time: Judges will consider whether clearing the debt in a reasonable amount of time is possible. If you can pay off the debt in three years, for example, the Judge may consider that a reasonable amount of time, so there would be no need to grant the Order for Sale.

• Alternative options: Is there another way the debt can be cleared? As we mentioned earlier, an Order for Sale is a last resort. The Judge will be open to looking at other options. So, if you have any ideas, put them forward to the Judge. Make sure the option you’re suggesting is reasonable. The Judge will ensure that the decisions made are fair for both sides.

• Property Equity: Is there much equity in the property? If there’s little or no equity, or if you are in negative equity, it wouldn’t make much sense to grant an Order for Sale as it’s likely the creditor wouldn’t benefit from the sale.

• Oh, and one more. Joint property ownership: If your property is a joint ownership and the debt is in your name only, it is more difficult for a Judge to grant an Order for Sale.

It might be that none of the above works for or applies to you. We still have one more ace up our sleeve. You can ask the court to let you sell your property yourself! It may not be your ideal situation, but at least it will give you time to organise yourself.

If there is enough equity in the property, you can buy another property or at least find a place to rent without being rushed out of the door, giving you back a little of the control you may feel you have lost.

The Real Debt Guy is a qualified financial adviser and a UK debt expert. The information in this article is considered to be true and correct at the publication date.