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Fixed Charge (LPA) Receivership

Our dedicated team of independent receivership specialists can help maximise the recovery of value from non-performing assets.

This may involve steering towards a consensual resolution, acting as a bank monitor or shadow receiver, or arranging an immediate sale or program of asset management initiatives.

As registered Law of Property Act (LPA) receivers, our surveyors are experienced in dealing with non-performing loans and working with all parties to drive value recovery.

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When a lender has a fixed charge, such as a mortgage and other assets, a receiver can be appointed to take control of the asset and sell it on behalf of the lender to repay a debt.  In some cases, a receiver may run the property and divert income to the lender.

This kind of receivership is distinct, however, from a formal insolvency practice. While receivers are often appointed when the borrower has been unable to repay a loan, we also handle specific breaches of the loan agreement, for example, when a loan-to-value cannot be met by the borrower.

Bringing in a third-party LPA receiver can insulate the lender from certain legal liabilities and protects lenders from becoming what is known as a “mortgagee in possession.” It also avoids court proceedings, meaning the appointment is completely informal.

Finally, since LPA receivership is not related to an insolvency process, it is exempt from Insolvency Service regulations. This means the receiver can be a member of a professional trade body.

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Frequently Asked Questions

What is a fixed charge receiver?

When a lender has fixed charge such as a property mortgage and other assets, a receiver can be appointed to take control of the asset and sell it on behalf of the lender in order to repay a debt. A receiver will deal with the asset charged and in some cases, is able to run the property and divert income to the lender. Many refer to the fixed charge receiver as an LPA receiver, meaning they have been appointed under the Law of Property act.

It’s important to note that this kind of receivership is not a formal insolvency practice and while receivers are often appointed when the borrower has not managed to repay a loan, this kind of receiver can be appointed when there have been specific breaches of the loan agreement. An example of this kind of breach would be when a loan-to-value cannot be met by the borrower.

What are the benefits of a fixed charge receivership?

With an LPA receiver, the lender does not become what is known as a “mortgagee in possession.” It is also useful to bring in a third party and outside expertise and resources to insulate the lender from any legal liability. A receivership also avoids court proceedings, meaning the appointment is completely informal.

Are LPA Receivers Regulated?

There is no regulatory body for fixed charge receivers and as LPA receivership is not related to an insolvency process, it is not regulated by the Insolvency Service. With this in mind, the receiver can be a member of a professional trade body.