After-sale shared equity procedures: guidance
Guidance to cover after-sale procedures in relation to Scottish Government’s various shared equity schemes.
Annex 7 - Enforcement of Primary Lender security / Appointment of Trustee
Annex 7(A) - Letter to Owner on receiving copy of calling up notice from Lender and/or notification that the Lender is considering re-possession
Insert Addressee/ Date
Issue of Calling up Notice by [ Insert name of Lender] ("your Lender")
[ [ Insert name of Lender / Lender's agent] have contacted us to inform us that they have served a calling-up notice upon you [ on behalf of insert name of Lender if served by solicitors on behalf of Lenders] as a result of your failure to maintain payments due on the mortgage account secured on your home.] OR
[We have been informed that you may be in financial difficulties and may be struggling to maintain the mortgage payments on your home and that your lender, [ Insert name of Lender] is considering taking action to re-possess the property.]
Please note that we act for the Scottish Ministers in this matter and not for you and cannot provide you with advice. We would however draw your attention to the fact that the notice strongly recommends that you take advice from a solicitor, Citizens Advice Bureau, other advice agency or an approved lay representative
Whilst it will be for you and your adviser to decide how best to proceed, you may wish to note that if you are in danger of having your home repossessed as a result of financial difficulties, the Scottish Government may be able to help you. The Scottish Government operates the Home Owners' Support Fund, to help owners who are experiencing difficulty in paying any loans that are secured against their property.
Under the Mortgage to Rent scheme the Scottish Government may, in certain circumstances, be able to arrange for a social landlord such as a housing association or local authority to buy your home and for you to continue to live there as a tenant.
If you wish to consider that option you or your adviser may wish to contact your local Citizens Advice Bureau, Money Advice Scotland outlet or Local Authority Money Advice Centre as soon as possible to determine whether or not you could apply to the Home Owners Support Fund.
Annex 7 (B) - Email to Lender / Lender's agent on receiving copy of Calling up Notice and/or notification that the Lender is considering re-possession
The Scottish Ministers
( Insert name of Owner)( the "Owner")
[ insert name of Lender ]( the "Lender")
Insert Address (the "Property")
I refer to your letter of ( Date ) informing us/ Scottish Ministers that [you have been instructed to serve a Calling up Notice on the Owner in respect of the Property]/[the Lender is considering taking action to call-up its security over the Property] which has been funded by one of the Scottish Government's shared equity schemes.
We have today written to the Owner to inform them that when discussing the matter with their adviser they may wish to consider whether assistance should be sought under the Scottish Government's Home Owners Support Fund which includes the Mortgage to Rent Scheme. We are also referring the matter to Scottish Government who may wish to discuss with the Lender direct. Do you have the name and email / telecom details of the person who is dealing with this for the Lender?
Please note that under the Ranking Agreement entered into between Scottish Ministers the Owner and the Lender, which is in the form approved with CML, the Lender may be under a duty to consult with Scottish Ministers with a view to agreeing on the terms of any sale. The Ranking Agreement will also provide that both the Lender and Scottish Ministers are permitted to disclose to each other information on the Owner and their affairs and that Scottish Minsiters would wish to be kept fully apprised of the position.
Please contact Scottish Government's solicitors Harper Macleod if you wish to discuss further.
Proposed letters/ emails to Trustee -
Annex 7(C) - Email to Trustee on notification of Appointment
Inset Name of Owner (the "Owner")
Insert Address of Property (the "Property")
We understand that you have been appointed as Trustee for the Owner.
As you may have seen from title search over the Property Scottish Ministers [alternatively insert name of RSL] have a Standard Security over the Property in relation to obligations by the Owner in respect of shared equity arrangements under one of the Scottish Government's shared equity schemes.
Scottish Ministers / We trust that suitable arrangements can be made to ensure that the Owner will remain within the Property. However, should the position change and you intend to take action to sell the property, I would be grateful if you could please inform us as soon as possible.
Finally, please note it is not our/ Scottish Ministers' intention at this stage to exercise any rights which they may have over the Property as security holder as a result of your appointment.
Annex 7(D) - Email to Trustee in respect of possible action being taken in respect of the Property
Insert Name of Owner (the "Owner")
Insert Address of Property (the "Property")
We understand that you are currently deciding whether you should sell the Property over which Scottish Ministers/ We have a Standard Security over the Property in relation to obligations by the Owner in respect of shared equity arrangements under one of the Scottish Government's shared equity schemes.
Whilst it will be for you and your advisors to decide how best to proceed you may wish to note that Scottish Government may be able to assist. Scottish Government operates the Homes Owners Support Fund to help Owners who are experiencing difficulty in paying any loans that are secured against the Property.
Under the Mortgage to Rent scheme, Scottish Government may, in certain circumstances, be able to arrange for a social landlord such as a Housing Association or local authority to buy the property and for the Owner to continue to live there as a tenant.
If you wish to consider that option you or your advisors may wish to contact Money Advice Scotland or your local authority money advice centre as soon as possible to determine whether or not the Owner could apply to the Home Owner Support Fund .
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