Mortgage possession proceedings
Procedure for a mortgage lender repossessing a property because of mortgage arrears. The types of court order and what happens after it is granted.
Legal background to court action for mortgage arrears. Lender's remedies differ depending on when mortgages were taken out.
The steps the Financial Conduct Authority (FCA) requires lenders to take before commencing court action.
Rules for bringing a possession claim and sending notices, filing a defence, and the court powers during the hearing.
Borrowers should check mortgage documents for defects, amounts claimed for accuracy and lender’s behaviour for violations of borrower’s rights.
Borrowers should complete the defence form and return it to the court, collect evidence and attend the hearing in judge’s chambers.
Judges can make orders ranging from granting outright possession to dismissing the claim if it should not have been issued.
Borrowers can ask the court to make a time order to reschedule the amount due over a longer period if the lender has taken court action.
Ways a borrower can apply to the court to challenge, alter or discharge a possession order. This advice applies only to residential mortgages.
Bailiffs enforce possession warrants after the lender obtained them from court and served a notice on occupiers.
Court powers after repossession, the lender's duties to take care of the property and a reasonable price when selling the property.
Borrowers may sell the property to obtain a better price either during or after possession proceedings, and lenders rarely want to stop the sale.
Lenders of second charge loans must comply with the pre-action protocol and potentially additional requirements before taking possession action.
Borrowers' powers to grant tenancies, whether a tenancy is binding on the lender, and how tenants of borrowers can become involved in possession proceedings against their landlord
Combination of rights stemming from mortgage for a share of property and tenancy for the remainder complicates possession process.