Bank commenced possession proceedings in respect to property I am renting?

franklee

Thank you for the update Flyer333. As predicted the two months starts from when the lender granted the delay which is a little early to be useful as far as I can see so you're right to ask Shelter. Like I said before you need to be clear if you have the right to leave as you're still bound by the fixed term (unless there is a break clause). You do not want to be chased for any rent after your move out date. Hopefully Shelter will clear this up for you letting you know when you are free to leave. The Mortgage Repossessions (Protection of Tenants etc) Act 2010 is one Shelter campaigned for so they ought to know how it works in practice. Good luck and I hope you let us know what Shelter say.

G_M

Flyer333 wrote: »

Update:

"___Bank Plc undertakes not to enforce any Order for Possession of the Property for a period of 2 calendar months commencing on the date of this letter,

PROVIDED THAT, any rental payments falling due within the period in which HSBC Bank Plc agrees to postpone the enforcement of the Possession
Order are paid direct to HSBC Bank Plc

and pursuant to section 1(7) of the Mortgage Repossessions (Protection of Tenants etc) Act 2010 the payment of any such rental monies direct to HSBC Bank Plc is not to be regarded as creating (or as evidence of the creation of) any tenancy or other right to
occupy the Property.” Rental payments should be made by cheque, sent to us rather than directly to our client. However please make the cheques payable to ____Bank Plc."

..

My take on this is that rent should be paid to the bank between the date of the hearing and the date I move out?

My take on this is that they are saying rent should be paid to them from the date of the letter, NOT from the date of the hearing.

There are two major flaws in the 2010 Act highlighted here:

1) the tenant gets 2 months security, but the 2 months starts from date of letter. If the court repossession hearing is not for, say, another month, tenant only gets 1 month security.

This is because, as Franklee said, if you give notice/leave before the hearing, and then the landlord pays off his mortgage arrears and the repossession is denied, the tenant is still bound by the tenancy and must pay the LL rent.

2) HSBC are attaching an (unfair) condition to the 2 months security - tenant must pay rent to them direct immediatey (from date of letter when the 'postponement' starts)). Fine for them - they get cash towards the mortgage arrears! But again, if the repossession is cancelled, LL could argue he has not received rent and demand it off the tenant!

But conversely, if tenant does not ay HSBC the rent, they may withdraw the 2 month postponement!

My advice? Do NOT pay HSBC the rent till the result of the hearing is known. If they use this as excuse to go back on their offer to postpone for 2 months, apply to the court under the Act to award a 2 month postponement (which would then commence from the hearing date, not the date of the letter.

It's a legal mess!

franklee

G_M wrote: »

My take on this is that they are saying rent should be paid to them from the date of the letter, NOT from the date of the hearing.

There are two major flaws in the 2010 Act highlighted here:

1) the tenant gets 2 months security, but the 2 months starts from date of letter. If the court repossession hearing is not for, say, another month, tenant only gets 1 month security.

This is because, as Franklee said, if you give notice/leave before the hearing, and then the landlord pays off his mortgage arrears and the repossession is denied, the tenant is still bound by the tenancy and must pay the LL rent.

2) HSBC are attaching an (unfair) condition to the 2 months security - tenant must pay rent to them direct immediatey (from date of letter when the 'postponement' starts)). Fine for them - they get cash towards the mortgage arrears! But again, if the repossession is cancelled, LL could argue he has not received rent and demand it off the tenant!

But conversely, if tenant does not ay HSBC the rent, they may withdraw the 2 month postponement!

My advice? Do NOT pay HSBC the rent till the result of the hearing is known. If they use this as excuse to go back on their offer to postpone for 2 months, apply to the court under the Act to award a 2 month postponement (which would then commence from the hearing date, not the date of the letter.

It's a legal mess!

Thank you G_M. It's good to see someone else highlighting the flaws in the new act. I sometimes feel Miss MoneyPenny and I are flogging a dead horse when explaining to certain other regular landlords here (not you) that a tenant still needs to check for consent to let even though we now have the new act. Obviously the new act is an improvement on nowt, but as so often happens with legislation concessions have been made and the lender's interest still pulls rank on the tenant. As I've been saying to the usual objectors on the sticky thread it still leaves the tenant with a logistical headache. Hopefully Shelter will guide Flyer333 though the pitfalls and if he reports back we will all see how it works in reality. What worries me in Flyer333's case is that his fixed term ends officially next February so there is potentially a quite few months rent at stake - unless there is a break clause which I have asked twice but not been answered on. Frankly I would like to have seen the new act make the tenancy agreement stuck out in cases like the OP's - but if the repossession is staved off I can see the landlord would object to that. Bottom line - tenants you still need to check for consent to let.

Flyer333

Sorry, there is no break clause as far as I can see.

I wrote back to the lender as they got a date wrong, asking me to send them a signed copy of their letter by 20th April, when I think they meant 20th May.

Its a bit confusing because on the one hand the lender are asking for money, whereas I also have a tenancy agreement in place for the very same product and service.
Bit stupid really, and in addition to that, I dont have enough money to pay both so have no idea what to do.

Flyer333

Perhaps it may be a better idea to reject their offer and apply through the court instead?

Flyer333

I spoke to Housing Rights officer at the local town hall drop in centre who advised:

1. The tenancy agreement between myself and the letting agent/landlord is not worth the paper it is written on and I am well within my rights to cancel the direct debit, advising them in writing of my decision.
2. The agent/landlord would have no grounds to pursue me for breach of contract because the landlord did not have consent to let in the first place.
3. I can pay the lender instead, should I decide to take them up on their offer of 2 months notice. However, I intend to move out before the case on 12th june, and my next payment is not due until around that time anyway so its not really an issue.
4. I will get my deposit back through the usual channels, making sure I take photos of the property to cover myself.
5. I could pursue the landlord for costs incurred, but if he is broke then I wouldnt see any money even if I was successful. I would be able to do this any time in the next 6 years, but I would rather just move on and put it down to a lesson learned.

So now its just a case of finding a property to move into - one which the landlord has permission to let!

chappers

Sorry to confuse the situation here but the Housing rights officer has mis-informed you.

You have a legally binding contract with your LL whether written or implied, due to the fact that you have been living in his property and paying him regular rent and he could persue you for breach of that contract.

HSBC have no contract with you and shouldn't be demanding rent from you at any point, as has been pointed out if the repossesion is stopped then the rent will be owed to the LL not HSBC.

It all depends how clued up your LL is and whether he is going to be able to stave off this repossesion.

Personally speaking I wouldn't do anything in haste, sit tight for now, attend the hearing and make yourself known to the court as an interested party. If the repossesion is granted then request 2 months from the court, laying it on that you are going to be homeless etc.
Then move on.
If the repossesion isn't granted and you move out and your LL is savvy you could find yourself on the wrong side of a court hearing.

After all you didn't think you were going anywhere until February, so another couple of weeks isn't going to hurt.

I would certainly hold onto the rent due on the 8th until you know what the situation is.

franklee

Flyer333 wrote: »

I spoke to Housing Rights officer at the local town hall drop in centre who advised:

1. The tenancy agreement between myself and the letting agent/landlord is not worth the paper it is written on and I am well within my rights to cancel the direct debit, advising them in writing of my decision.
2. The agent/landlord would have no grounds to pursue me for breach of contract because the landlord did not have consent to let in the first place.

Thanks for the update.

I'm certain this is not true in general. However I think it will become true at some stage of the repossession you need to find out exactly when. I'm pretty sure you aren't at that stage yet!

What legal qualification does a Housing Rights officer at the local town hall have? I'm sorry but I would not trust what they have said. You need to speak to Shelter and/or get proper legal advice from someone legally qualified and experienced in landlord and tenant law.

You could try asking on Tessa's landlord law blog you may get lucky or see if there is an article on Painsmith's blog you can comment to ask on. Or seek advice but you may have to pay for that.

G_M

I too believe you have received very poor advice from the HRO.

1. The tenancy agreement between myself and the letting agent/landlord is not worth the paper it is written on
it may be a poorly drafted tenancy; some of it may be uneforcible. But there IS a contract between you. You've lived there & paid rent. Tenancy agreements do not have to be written at all.
and I am well within my rights to cancel the direct debit, advising them in writing of my decision.
I agree in this case you should cancel your ... standing order? (The landlord would have to cancel the DD if that is how you pay.) But you are not 'within your rights' to do so - as above, you have a contract and owe the rent. However in the circumstances it may be prudent to cancel, and keep the money ready to pay in due course
2. The agent/landlord would have no grounds to pursue me for breach of contract because the landlord did not have consent to let in the first place.
Absolute twoddle! The LL's relationship with his mortgage lender does not in any way affect the legality of the tenancy.
3. I can pay the lender instead, should I decide to take them up on their offer of 2 months notice.
As I said above, this is unwise. You owe rent to the landlord under the tenancy. If the repossession does not go ahead, the LL can claim the rent. The fact you generously gave it to a 3rd party (the lender) does not mean you do not owe the LL!
However, I intend to move out before the case on 12th june, and my next payment is not due until around that time anyway so its not really an issue.
If you move out, let's hope the LL loses his property and does not comeafteryou for breaching the tenancy.....
4. I will get my deposit back through the usual channels, making sure I take photos of the property to cover myself.
as above. The LL will have to agreetorelease the deposit. He may claim you have broken the tenancy and owe rent, so withold the deposit.
5. I could pursue the landlord for costs incurred, but if he is broke then I wouldnt see any money even if I was successful. I would be able to do this any time in the next 6 years, but I would rather just move on and put it down to a lesson learned.

Catch 22:
* LL loses at the hearing. Clearly broke. not worth suing.
* LL wins at hearing (eg pays off his mortgage arrears). he does have money. But can't be sued because it is you who has breached the tenancy agreement by moving out without notice....

G_M

franklee wrote: »

...... I sometimes feel Miss MoneyPenny and I are flogging a dead horse when explaining to certain other regular landlords here (not you) that a tenant still needs to check for consent to let even though we now have the new act.....

Whilst I applaud your efforts, can I suggest that Miss MoneyPenny reviews and amends the original sticky?

The advice to tenants to check CTL is sensible, however the original post, even as amended in March, leaves much to be desired. Especially as an original sticky, since readers tend to take these as being more 'authoritative' than plain old posts in plain old threads.

* There is NO mention of the 2010 Act. There IS a statement "Without the lenders permission to let, you could be thrown out of the property without any notice." At the very least, the tenant would receive a letter to "The Occupier". And as we know, can get 2months grace (albeit with dubious start date!)

* seeking confirmation from the lender of CTL is unrealistic. Asking them to verify a CTL letter...??? Data Protection. And writing to them during the tenancy application process is also non-productive and unrealistic.

* There is a strong implication that where a LL's address on Land Registry Title is the let property address, the LL has no CTL. This by no means follows, and should be used merely as a possible indication. There are many many 'accidental' LLs, for example, who simply don't bother, or forget, to change their address at the LL. This does not mean they are bad LLs though. Or that they don't have CTL

* As for writing to the LL at the property to see if Royal Mail redirection is in operation, this only works once the tenant has moved in, so what exactly will it achieve? And just because postal redirection is in place does not mean there's no CTL!