We believe that the only security worth having is one that is backed by tangible assets such as real estate, in an established and reliable legal environment such as the UK. In a world full of complex financial products which offer promises of growth based on theoretical predictions or past performance of stock markets, it is refreshingly simple and clear to have an investment product which provides you with a fixed rate of growth along with the peace of mind that in the unlikely event of default, you have legal ownership of physical assets to recover your investment. This security is provided by using a legal charge over assets.

A legal charge is a method by which a lender protects the money they have lent to an individual or company. It is a legal document signed by the borrower and which is registered against a property at the Land Registry so as to alert any potential buyer of the existence of the debt. This means that it would not be possible to sell the property without the charge being removed, which would require repayment of the money owed. The legal charge itself will set out the amount borrowed, the terms on which it has been borrowed and the means by which the lender can enforce their rights against the property.

One of the most common types of a legal charge is a mortgage from a bank or building society. In consideration of the mortgage funds that you are borrowing, the bank or building society will require a legal charge to be secured against the property. The legal charge will remain registered against the property until such time as the mortgage is repaid. If there is a default under the terms of the mortgage, e.g. missing the monthly payments, the bank or building society can rely on their legal charge to enforce their rights. Ultimately, this could mean that the bank or building society sell the property.

A legal charge will only be removed once all of the funds borrowed (including any added interest and fees) are repaid. If at the time a property is sold there are still outstanding monies owed to a lender, the lender will be repaid out of the sale proceeds. The lender would be paid first, followed by the other fees and disbursements incurred in connection with the sale. The balance of the sale proceeds, if any, will be paid to the seller. Once the debt is settled in full, the lender will sign a legal document to remove their charge from the title at the Land Registry.