Deed of variation to AST required by new Lender?
We have just remortgaged on a rental property and our lender requires a condition inserting into the AST which is now on a statutory rolling tenancy.
The condition would allow them to collect the rent directly from our tenants in the event that we defaulted on the mortgage payments. Has anyone had experience of this.
I spoke to the NLA helpline and they referred to a deed of variation signed by landlord and tenant and witnessed.
Where can I get a deed form ? Or is it better to do it through a solicitor ?
Thanks in anticipation of help.
Chris
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Member Since February 2011 - Comments: 3454 - Articles: 286
1:16 PM, 5th February 2018, About 8 years ago
Hi Chris,
As the conveyancing solicitor is dealing with the lender I would ask them about changing the tenancy agreement, but the tenant would also need to agree to the changes.
As you are now in periodic would you and the tenant want to sign a new fixed term?
From .Gov >> https://www.gov.uk/private-renting-tenancy-agreements/changes-to-tenancy-agreements
“4. Changes to tenancy agreements
Both you and your landlord must agree in order to change the terms of the tenancy agreement.
Preventing discrimination
You can’t be discriminated against or harassed by your landlord because of:
age
gender
sexual orientation
disability (or because of something connected with your disability)
religion or belief
race
being a transgendered person
being pregnant or having a baby
Example
You might need a guide dog in the house but a term in the tenancy says no pets are allowed. Your landlord must change the terms to allow guide dogs in the property, unless they have a very strong reason not to (if another tenant in the property has a serious allergy to dogs, for example)”
Member Since July 2013 - Comments: 2004 - Articles: 21
5:04 PM, 5th February 2018, About 8 years ago
Hi
The lender does not need this legally. All the lender needs do is take from you an assignment of the right to receive rent and give notice to the tenant and direct the tenant to pay rent to it. Further and in the alternative the lender could require rent to be paid to a specific account. Jog done.
That said, the prospects of getting a lender to change its mind are slim. Ask what clause it wants and then see if the tenant will sign up to a new AST.
Member Since July 2013 - Comments: 293
7:44 AM, 6th February 2018, About 8 years ago
Do you mind letting us know what lender this is please?
Member Since February 2018 - Comments: 27
12:19 PM, 8th February 2018, About 8 years ago
Reply to the comment left by Yvette Newbury at 06/02/2018 – 07:44
Hi all, thanks for the comments.
The tenant has agreed to including this condition as remortgaging means we can hold the rent at its current level for another 2 years. So no rent increases for 3.5 yrs.
I agree that probably best soln. Is a new AST but was trying to avoid redoing deposit protection etc.
The lender is Barclays.
Process took 6 wks from approval!
Solicitor lost signed deed which cost us 1 week.
Member Since June 2014 - Comments: 325
9:13 PM, 10th February 2018, About 8 years ago
Hi Chris – suspect not uncommon as I was required to write this into my leases but was at original loan stage so no problem with variation. Allan