In April 2015 we reported the introduction of an updated Pre-Action Protocol for possession claims. The updated protocol introduced the following additional requirements for lenders to:
At that time the Ministry of Justice did not update the prescribed Pre-Action Protocol checklist to reflect the changes.
But this all changed on 5 October 2015 when they introduced revised documents to reflect the new requirements of the protocol.
Some key points for you to consider include:
Paragraph 10 has been revised with the lender now having to state whether any tenancy was entered into - with or without the lender's authorisation - and if the former, what steps the lender intends should be taken.
New sections have been added to reflect the changes in the protocol. As a result numbering within the checklist has changed; something to bear in mind if checklists are being populated by automated systems.
Paragraph 2(b) now requires confirmation that the two year statement has been sent to the customer, as well as the date it was sent.
Paragraph 7 now states "Please explain what steps the mortgagee has taken to check whether there is a tenant of the borrower in occupation, whether that tenant was authorised by the mortgagee, and what order the mortgagee is seeking in light of the information obtained".
It's important to remember that the protocol is concerned with authorised tenants but does not apply to buy-to-let mortgages.
The main points of consideration for ensuring compliance are:
If you have any questions regarding strategy for ensuring compliance with the protocol or completion of the new checklist, we would be happy to review this with you.
This publication is intended for general guidance and represents our understanding of the relevant law and practice as at October 2015. Specific advice should be sought for specific cases. For more information see our terms & conditions on www.TLTsolicitors.com