Written Question · S3W-22424 · Session 3
What action it is taking to protect tenants in the private rented sector from the threat of homelessness due to landlords defaulting on the…
The question
To ask the Scottish Executive what action it is taking to protect tenants in the private rented sector from the threat of homelessness due to landlords defaulting on their mortgages.
The answer
When a lender takes enforcement action against a private landlord defaulting on a mortgage, the position of the tenant, including the length of notice the creditor must give to the tenant, depends in the first instance on whether the landlord complied with the terms and conditions of the mortgage by obtaining the creditor''s consent to the tenancy and in the second instance on the specific terms of the tenancy agreement. It is possible that the lender may have contractual as well as statutory obligations to the tenant.
Other than any contractual obligations that a creditor may be under to inform tenants of steps that may be taken against a landlord in default of their mortgage, the Conveyancing and Feudal Reform (Scotland) Act 1970, as amended by the Mortgage Rights (Scotland) Act 2001, imposes a statutory obligation on a creditor to send notification to the occupier of the relevant property by recorded delivery when commencing various forms of enforcement action against a landlord in default or in breach of standard security conditions. This alerts a tenant that such action is underway. Failure to notify the occupier in the required manner will invalidate the action being taken by the creditor.
Amendments to the 1970 Act made by the Homelessness etc. (Scotland) Act 2003, which came into force on 1 April 2009, require creditors to notify the relevant local authority in a specified form when they call in a mortgage or take other steps to recover possession. Local authorities can then identify private rented properties from their landlord registration database, enabling them to contact tenants to offer appropriate support or advice.
The Repossessions Group, which was set up by the Scottish Government in January 2009, intends to consider the issue of protection for private tenants living in properties that are repossessed by lenders.
Other than any contractual obligations that a creditor may be under to inform tenants of steps that may be taken against a landlord in default of their mortgage, the Conveyancing and Feudal Reform (Scotland) Act 1970, as amended by the Mortgage Rights (Scotland) Act 2001, imposes a statutory obligation on a creditor to send notification to the occupier of the relevant property by recorded delivery when commencing various forms of enforcement action against a landlord in default or in breach of standard security conditions. This alerts a tenant that such action is underway. Failure to notify the occupier in the required manner will invalidate the action being taken by the creditor.
Amendments to the 1970 Act made by the Homelessness etc. (Scotland) Act 2003, which came into force on 1 April 2009, require creditors to notify the relevant local authority in a specified form when they call in a mortgage or take other steps to recover possession. Local authorities can then identify private rented properties from their landlord registration database, enabling them to contact tenants to offer appropriate support or advice.
The Repossessions Group, which was set up by the Scottish Government in January 2009, intends to consider the issue of protection for private tenants living in properties that are repossessed by lenders.
In the Official Report
No contribution in the Official Report cites S3W-22424 by reference.