Question

Changing the Terms (England) | During the Tenancy (England) | England

New mortgage – bank requirement

8 Apr 2021 | 1 comment

I am applying for a mortgage on my existing tenanted property in England.  A condition of the mortgage will be that my tenant will sign a form agreeing that he will vacate immediately if the bank want possession.

What rights would the bank have over my tenant, please, if for some reason they became entitled to possession of the property?

Eg would they have to give him 6 months’ notice of eviction?

He has an AST which became periodic a few years ago.

If my tenant agrees to sign, is there any other paperwork that I should complete?

Answer

1 Comment

  1. guildy
    guildy on 09/04/2021 at 9:10 am

    This sounds completely unlawful and even if it’s borderline in that respect, it’s morally unacceptable!

    Because the tenant is in occupation at the time of granting the mortgage, the tenancy is binding on the mortgage company and as the Shelter website puts it:

    “You can stay in your home if you have a binding tenancy. This means you become a tenant of the lender if the court makes a repossession order.”

    In any event, a tenant can apply to the court for up to 2 months before they have to leave and even then, the bailiff must give at least 14 days notice before visiting.

    We would be grateful if you would send us a copy of the mortgage term to our email info@landlordsguild.com.

    Please also see here for a good summary of the procedure for a mortgage company on tenanted property.

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