Posts
The court has appointed parties be heard further in the Scottish repossession test cases of RBS plc v. McConnell and NRAM plc v. Millar next week. Sheriff AF Deutsch has given parties an opportunity to be heard on a new point in relation to the Interpretation Act 1978. Many lenders and law firms in Scotland have interpreted 'default' to mean merely a failure to pay sums due under a mortgage, whereas Govan Law Centre has argued that 'default' is a technical term which means the failure to comply with a calling-up notice.
The cases of RBS plc v. McConnell and NRAM plc v. Millar look set to provide clarity on this point. Many repossession actions across Scotland have been continued or sisted (stayed) pending the court's judgment in these cases.
looking at the SPML terms 'Lending Mortgage Conditions';
ReplyDeletea) On page 1(depending which edition)it says:
'once the loan has been made you will therefore, be subject to both the loan conditions in section C and the mortgage conditions in section D'.
b) the right of SPML to transfer/assign your loan was under SECTION B 'Offer Conditions'.
c) so as a borrower you only gave consent for your mortgage loan to be transferred during the 'offer stage' ie under Section B., and NOT after you received the loan.
Question to GLC: does this not mean therefore, that SPML had NO right to transfer/assign the borrowers loan to an SPV or other 3rd party, without the consent of the borrower?
Is this not a fundamental breach of the contract?
FSA links, re-affirm GLC stand on unfair charges:
ReplyDeletehttp://www.fsa.gov.uk/library/other_publications/miscellaneous/2009/mortgage_arrears_1/standards
Securitisations
24 Apr 2009
Our review of mortgage arrears-handling by specialist lenders looked at securitisation covenants, and found that some could lead to unequal treatment of borrowers.
No provision within a securitisation covenant should lead to the less fair treatment of borrowers. In practice, fewer tools are usually available for resolving arrears for securitised loans. For example, the terms of a securitisation may prevent an extension of the loan term or conversion to interest-only for a period, both of which may otherwise be legitimate means of dealing with distressed borrowers in particular circumstances.
We expect all customers to be treated fairly and to be offered a relevant range of options for resolving arrears. It is not acceptable for a firm to use terms included in a securitisation as justification for not treating customers fairly.
We do not expect to see future securitisations that contain provisions that could potentially lead to the less fair treatment of borrowers, for example, by restricting or preventing the use of any commonly available arrears tool where it would achieve the right outcome for customers.