Explanation of burdens/charges on a folio

Cranes

New Member
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3
I have a situation where I have a property folio that has numerous(4 in total) charges/burdens attached to it. I have defaulted on payments and therefore Bank of Ireland are at charge No. 1 and are making moves to sell it, they have recently put it on the market. Their asking price is very low and the property would also be in negative equity so basically if they sell it, the price they get wouldn't cover what they are owed let alone the others at Charges 2, 3 & 4. What happens in this case, would the others at charges 2, 3 & 4 allow this to go ahead or do they have a choice? Is it true that whoever has charge 1 can decide to sell and if there isn't anything left for the rest then it just gets sold? In that case do all the charges get removed from folio when the sale goes through i.e a clean title?
 

Bronte

Frequent Poster
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13,681
The purchaser will not purchase unless there is a clean title. So all the charges must be removed. The person with the first legal charge, normally the bank (mortgage) will take the proceeds of sale. In this case there is not enough to pay the others. So their charge was worthless to them. But the money will still be owed.

Have you gone bankrupt or done something to sort out your financial situation?
 

Dazzler123

Frequent Poster
Messages
63
The purchaser will not purchase unless there is a clean title. So all the charges must be removed. The person with the first legal charge, normally the bank (mortgage) will take the proceeds of sale. In this case there is not enough to pay the others. So their charge was worthless to them. But the money will still be owed.

Have you gone bankrupt or done something to sort out your financial situation?

If it is the bank selling it, they will sell as mortgagee in possession and will overreach the subsequent judgment mortgages, basically the bank will ignore the subsequent judgment mortgages and take the full sale proceeds after paying legal and auctioneer fees. You will still owe the remaining balance to BoI and will also owe the judgment mortgage holders whatever they are owed.
 

cremeegg

Frequent Poster
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3,066
The main question for the solicitor is does the sale extinguish the other charges, I think it does. Does that mean you no longer owe the money on the second etc charges, I think you do.
 

Cranes

New Member
Messages
3
Thanks for the information, this answers my question. I was really just wondering if it was even possible for the bank(at charge 1) to go ahead and sell even though all the others will be left with nothing. I assume the others at charges 2, 3 & 4 get notified when the bank is trying to sell it as they have an interest in it? Do they have to agree to remove their charges or does that just happen during the sales process anyway?
 
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