Tenant Mortgage Protection Legislation Coming into Force

We have previously posted on the Mortgage Repossessions (Protection of Tenants etc) Act 2010 which was passed through Parliament in the sweeping up process immediately prior to the election. There was some doubt as to whether the new government would actually bring the Act into force but it seems that they have decided to do so.

Briefly, the new Act allows for tenants whose tenancies were not authorised by a mortgage lender to request a 2 month stay on an order for possession or the execution of a warrant for possession by the mortgagee. If the mortgagee will not grant such a stay in writing then the tenant has the power to apply to the Court for the same stay.

The Court is not obliged to grant the stay and will consider the cirumstances of each case and, in particular, will look at the conduct of the tenant and any breaches of the tenancy agreement committed by the tenant. It can also require the tenant to pay the rent direct to the mortgagee during the period of the stay.

The Act also creates a power for the government to set a standard form of notice which the mortgagee must give at the property and they cannot obtain possession until that notice has been given.

The commencement order which has been passed allows for the regulations to enable the notice process to be made immediately and brings the rest of the Act into force on 1 October 2010.