Q&As

A borrower was unable to repay a commercial loan and so the lender registered a charge against the borrower’s residential home. The charge was registered over 25 years ago and the borrower has not received any demands for payment, and now wishes to discharge the charge. How long does a lender have to bring an action to recover sums secured by a registered charge? Would section 20(1) of the Limitation Act 1980 apply in this case, ie is it the case that the lender can no longer bring any action against the borrower as the time since the charge was registered has exceeded 12 years?

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Published on LexisPSL on 06/07/2020

The following Property Disputes Q&A provides comprehensive and up to date legal information covering:

  • A borrower was unable to repay a commercial loan and so the lender registered a charge against the borrower’s residential home. The charge was registered over 25 years ago and the borrower has not received any demands for payment, and now wishes to discharge the charge. How long does a lender have to bring an action to recover sums secured by a registered charge? Would section 20(1) of the Limitation Act 1980 apply in this case, ie is it the case that the lender can no longer bring any action against the borrower as the time since the charge was registered has exceeded 12 years?

This Q&A relates to a charge debt, and not to a charging order. Section 20 of the Limitation Act 1980 (LA 1980) does not apply to charging orders.

On that assumption, typically, claims for a mortgage or charge debt are governed by LA 1980, s 20 (and not LA 1980, ss 5 and 8).

LA 1980, s 20 provides that no claim shall be brought to recover:

‘…(a) any principal sum of money secured by a mortgage or other charge on property (whether real or personal); or

(b) proceeds of the sale of land;

after the expiration of 12 years from the date on which the right to receive th

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