Webcast Flashcards
The function of a security is to guarantee that a loan will be repaid. True or false?
True.
HB has agreed to lend M £90,000 to help fund her purchase of a house. It wants security for loan in the form of a mortgage. Who will grant the mortgage?
M will give a mortgage to the bank.
A mortgage will give the bank an interest in the property? True or false.
True, it is an interest in land.
What is a mortgage?
An interest in property granted by a mortgagor to a mortgagee with a provision for redemption.
What is redemption?
Redemption of a mortgage refers to the process of freeing property from a mortgage by repayment of debt.
Who is the mortgagor?
The person who grants the mortgage. The borrower.
Who is the mortgagee?
The person who receives the mortgage. The lender.
M (house owner) will be the mortgagee? True or false?
False.
A full description of a mortgage is, a mortgage is an interest in land with a right of redemption by the mortgagor. Doe M having a right to redeem mean that she can require the bank to transfer its mortgage to a new property she decides to buy one?
No, right of redemption means M can require the bank to remove its mortgage when she pays off her loan.
The document creating the mortgage also operates as a contract between M and the bank. Is this correct?
Yes.
How do you create a mortgage?
S87(1) LPA 1925 says it involves granting a charge by deed by way of legal mortgage (legal charge).
How does a mortgage get it’s legal status?
It must be made by deed in compliance with s52 LPA 1925. And it must also be registered where it is granted over a registered title (s27 LRA 2002).
By which method can M create a mortgage over her registered estate?
By a charge by way of legal mortgage in favour of the bank (s87 LPA 1925).
What formalities are required for M to create a legal charge over her title?
A deed and registration at the land registry (s27 LRA 2002).
What is redemption?
It refers to the right the mortgagor has to pay off the debt and to take the pretty back free of the mortgage.
What is the legal right to redeem?
When a mortgage agreement is made they agree a date when redemption will occur (when the loan will be paid off in full and freed from the mortgage interest). This is the contractual legal right to redeem.
What is the function of the contractual date?
It’s purpose is to trigger some of the mortgagee’s remedies.
What is an equitable right to redeem?
It permits the mortgagor to redeem after the repayment date stipulated in the mortgage agreement.
The mortgage agreement between and and HBank provides M is to repay the loan by instalments over 20 years. Yet the mortgage agreement also has a clause stating that, notwithstanding any other provisions in this agreement, the debt shall be deemed to have become payable 6 months from the date this mortgage began. Can HB ignore the agreed 20 year repayment period and require M to repay the debt after 6 months?
No. It simply allows the bank to repossess and sell the property if M does not keep up with her repayments.
Imagine M sells her house for £10,000 more than her debt to HBank. Will the bank be entitled to keep all of the sale proceeds?
No, M will be entitled to the £10,000. It is the equity in the property.
What is the equity of redemption?
It is the name given to the mortgagors various equitable rights.
Why does a mortgagee have a right to possession of the mortgaged land?
as it is a legal charge it carries a rift to possess the land, which is an immediate rift to possess and arises as soon as the mortgage is made.
A mortgagee has the right to possession of the mortgaged property. Does its ability to exercise the right depend on a statutory power?
No (s87 LPA 1925).
A bank can, in its mortgage agreement, agree that it won’t exercise the right to possession unless the mortgagor breaks one or more of the terms of the agreement. True or false?
True, it is usually waived until the mortgagor defaults on the agreement.
J owns e registered title to his home. SBank has a registered legal charge and since J has not paid his mortgage instalments for over a year, SBank wasn’t to sell the property to recover their loan. However, before they sell it they intend to repossess the property. Why?
Because it will make a sale easier. Most buyers only take a property with vacant possession.
How does the mortgagee go about getting the mortgagor to leave. Does it have to go to court?
For residential purposes they will almost always go to court. The mortgagee is protected by s1(2) protection from eviction act 1977, they can only take it if they thought the mortgagee no longer lived there.
What does s6 of the criminal law act 1977 state?
It is a criminal offence to use or threaten violence for the purpose of securing entry into premises where someone is opposed to the entry.
To which type of property does s2 protection from eviction act 1977 apply?
Only residential property.
When will a mortgagee commit an offence under s2 protection from eviction act 1977 if it obtains possession of a residential property without a court order?
Sometimes unless he reasonably believed the occupier had ceased to reside there (Ropaigealach).
To which type of property does s6 criminal law act 1977 apply?
Commercial and residential.
When is an offence committed under s6 criminal law act 1977?
When violence is threatened to secure entry to property where someone is present who is opposed to that entry.
What does peaceable re-entry of a property mean?
That the mortgagee did not obtain a court order before obtaining possession of the property.
When a mortgagee goes to court for a possession order, how is the mortgagor given a second chance?
S36 administration of justice act 1970 which gives the court a discretion to delay the mortgagee getting possession. It’s intention is to allow the mortgagor breathing space to get his financial affairs in order.
What are the three pre-conditions for s36 of the administration of justice act to apply?
- property must be residential
- mortgagee must have applied for court order for possession (s36 not available for peaceable re-entry (Ropaigealach))
- it can’t be used if the mortgage has been granted as security for an overdraft
What are the powers of the court under s36 administration of justice act 1970?
- adjourn possession proceedings
- stay or suspend execution of a possession order or postpone the date of delivery of possession
Why might the mortgagor want to postpone the bank getting possession?
- to buy time to pay off arrears and get up to speed with repayments
- if he wants to sell the property himself
Does the court have jurisdiction under s36 administration of justice act 1970 in the case of commercial property?
No s36 applies only to residential property.
A mortgagee has repossessed an empty residential pretty without a court order. The mortgagor finds out and wants to apply to the court under s36 AJA 1970 to postpone possession. Can he?
No (Ropaigealach says it only applies when the mortgagee has applied for a court order for possession).
Under s36 AJA 1970 a court can defer granting a possession order, or delay it’s execution. If it reasonably considers that the mortgagor is likely to be able to pay sums due in a reasonable period?
Yes (s36 AJA 1970).
J owns the registered title of his house. SBank has a legal charge over e property and J has not paid mortgage instalments for over a year. SBank want to sell the house and recover their loan. It has applied to court for a possession order. As J does not want to lose his home he needs to demonstrate to the court he is likely to be able to repay any sums due. Under s8 AJA 1970 what does any sums due mean?
James must clear the arrears and continue to keep up with the new instalment payments as they fall due (s8 AJA 1970).
What is the maximum period of time for which the court can postpone possession, given J is seeking to clear his arrears?
The remaining period of the mortgage (Norgan).
What is the s36 AJA 1970 requirement being referred to in this quote from Syed. I need say no more than that the prospects of Mr S obtaining work are entirely speculative?
That the mortgagor can show they are likely to be able to pay any sums due in a reasonable period. It needs to be strong evidence of the ability to pay but does not have to be certain (s36 AJA 1970).
What is the meaning to pay any sums due under s36 AJA 1970?
That the mortgagor is able to clear the outstanding arrears of instalment payments and keep up with the others as they fall due.
What is the function of a security?
To provide some guarantee for payment of debt.
What is the meaning of the word reasonable period for paying off mortgage arrears?
The whole remaining length of the mortgage term but they must take these into consideration:
- ability of mortgagor to make the payments now and in the future
- likely duration of any temporary financial difficulty
- reason for the arrears
- period remaining of the original mortgage
- value of property measured against the amount owing
What is likely intended to mean with regards to repayment of arrears?
There must be a realistic chance, this must be supported by firm evidence of a detailed budget.
When the mortgagor wants to sell the property himself, what is meant by any sums due?
Repayment of the whole mortgage debt.
What is the meaning of the word likely in terms of selling the house himself?
Mortgagor has to show evidence in support of a sale occurring which will clear the debt.
What is a reasonable period in terms of the owner selling the house himself?
In National & Provincial Building Society v Lloyd it was indicated this could mean up to 1 year but no more. Bristol & West v Ellis said although 1 year was the maximum there was no fixed rule.
If J decided he wanted to ask the court to postpone possession to enable him to sell his property, what is the maximum period of time he is likely to be given to achieve the sale?
6 - 12 months (Bristol & West v Ellis).
In the case of Birmingham Building Society v Caunt, it was recognised that the court had an inherent power to postpone possession. However the court suggested that it could do so only for a very short period of around 28 days. Would a mortgagor ever apply to court under this jurisdiction rather than under the more generous jurisdiction of s36 AJA 1970?
Yes, it would be used by those whom s36 AJA 1970 was not available (communal mortgagor or residential mortgagor whose property has been peaceably repossessed).
Can the court order a sale notwithstanding the lender will be left out of pocket?
S91 LPA 1925 does give a court power to order a sale against the wishes of the mortgagee.
What point did the judge make in the case of Cheltenham and Gloucester v Krauz with regards to s91(2) LPA 1925?
It should only be used by a court in exceptional circumstances. If a mortgagee also wanted a sale they should be allowed to control it to prevent the mortgagor asking too high a price to put off the sale.
What was also said in Krauz about when a mortgagee sought possession under s36 but the mortgagors made an application under s91 to sell themselves?
If the mortgagor wanted to defer possession to sell property himself where it was in negative equity he had to show he had private means to clear the shortfall otherwise s36 could not be used.
What does it mean to say a property is in negative equity?
The market value of the property is less than the mortgage debt.
J wants to sell his house worth £150,000. There is a legal charge over the property in favour of Glass Bank securing a debt of £200,000. M has offered to buy the house but J has no means of payi off the £50,000 that would remain owing. M is not willing to take over this debt. Would J need the consent of the bank to sell?
Yes, as the bank has no obligation to remove the legal charge if it is not cleared.
J is up to date with his mortgage repayments and has offered to repay the outstanding £50,000 after the sale. GBank won’t agree to remove the legal charge. Do the courts have jurisdiction to require GBank to remove the charge from the property if the sale went ahead?
Yes (s91 LPA 1925 allows them to do this; Palk).
Which of the following correctly describes the situation that arose in the case of Palk?
- both the mortgagee and the mortgagor wanted to sell the property
- only the mortgagor wanted to sell the property
Only the mortgagor wanted to sell the property.
In Palk the property was in negative equity and the mortgagee suggested the property should be rented out until the market improved. True or false?
True.
In Palk, the court used its powers under s91 LPA 1925 to order a sale of the property against the wishes of the mortgagee. It said that it needed to do so to avoid manifest unfairness. What did they mean by that?
The mortgagee’s proposal to rent the property would have resulted in the debt significantly growing each year with no certainty when the market would improve and return the property to positive equity.
What is the situation that arose in Barrett v Halifax?
Both the mortgagor and the mortgagee wanted to sell.
In the case of Barrett was the mortgagor in arrears with their mortgage repayments?
Yes.
In the case of Barrett, if the mortgagee and mortgagor both agreed about a sale going ahead why did the mortgagee object to the Barrtt’s selling the property?
It wanted to control the sale given it’s power of sale had arisen as a result of the Barrett’s mortgage arrears.
In the case of Barrett why did the court order a sale under s91 LPA 1925 against the wishes of the mortgagee?
Because an unoccupied property will get a better sale price than a repossessed property.
In the light of the decision in Cheltenham & Gloucester v Krauz, is it correct to say that a court does not have jurisdiction under s91 LPA 1925, if the mortgagee has already started possession proceedings against the mortgagor unless the mortgagor can pay off the whole mortgage debt on completion of a sale of their property?
Yes. Possession can only be suspended if the whole debt can be paid off (s36 LPA 1925). Therefore the property needs to be in positive equity or the mortgagor will have to show evidence of being able to pay the shortfall.
Why did the court of appeal in Cheltenham & Gloucester v Krauz disapprove of the decision in Halifax v Barrett?
Because if the power of sale has arisen the mortgagee should be allowed to sell even if the mortgagor also wanted to do so.
When will s101 and s103 of the LPA 1925 apply?
It will only apply when the power of sale is not dealt with expressly in the mortgage deed.
How does the power of sale arise under s101?
The mortgage must have been made by deed
The mortgage money must be due (the legal date for redemption)
When the power of sale has arisen when can be it be used?
When any of the following conditions have been met:
- m’ee has served notice on the m’or requiring payment of the mortgage money and m’or has failed to pay for 3 months after receiving the notice OR
- interest under the mortgage is 2 months or more in arrears OR
- m’or is in breach of some other covenant in the mortgage deed, example other than repayment of mortgage or interest
Does a m’ee need to get leave of the court to sell the house under s101 and s103?
No, confirmed in Horsham v Clark and Beech.
Does a m’ee need a court order to sell a property?
No, there is a statutory power of sale under s101 - 103, mortgage agreement will also contain a contractual power of sale. Confirmed in Clark.
PBa k has a legal registered charge over As property. He is 2 months in arrears on his mortgage payments. Has the statutory power of sale arisen and become exercisable in favour in the bank?
Yes. S101 says the power arises when made by deed, we know it is as it’s a legal charge, the mortgage becomes due after 1 instalment is owing and unpaid (Payne v Cardiff Council). S103 says the power becomes exercisable after one of the three conditions are met, this one is interest due is 2 or more months in arrears.
What duty does the m’ee have with regards to power of sale?
General duty to act on good faith and to use its powers for proper purposes. It also has a specific duty of care as to the price it has to obtain.
What is meant by the m’ee being under no duty to exercise it’s power of sale?
The m’ee can’t be forced either to take possession or sell, even if the m’or would benefit from this happening (Silven Properties).
Is the m’or under a duty as to when he chooses to sell?
No. The impact of this is that the m’ee can sell immediately, even if delaying the sale would result in a higher price being obtained (Cuckmere Brick).
The m’ee must take proper care to get the best price that can reasonably be obtained at the date of sale, it’s their duty, what does this entail?
They must inform buyers of matters that improve the price (Cuckmere - planning permission to build on land not advertised).
Are there restrictions on who the m’ee can sell to?
Tse Kwong Lam - a sale to an associated person is not necessarily invalid, just reverses the burden of proof and must show he acted in good faith and took reasonable precautions to get the best price. Failed to check auction was best price to get and their company bought the property.
What came from the case of Corbett v Halifax?
Even if bad faith is shown by the m’ee, a sale will only be set aside if the purchaser had knowledge that they acted in bad faith. Otherwise the purchaser is protected under provisions in s104(2) LPA 1925.
Assume PBank has sold As house to the cousin of the bank manager. Would it necessarily have breached one of its duties of sale towards A?
No, they just have to show they acted in good faith and took reasonable precautions to obtain market value.
If PBank took insufficient steps to advertise As property for sale and consequently sold at less than market value, would it necessarily have breached one of its duties of sale towards A?
Yes (Cuckmere Brick).
If PBank sold As property without first making some significant repairs to its roof that would have enhanced the property, would e bank have breached one of its duties of sale to A?
No (Silven Properties).
If PBank sold As property knowing that the market would improve if it waited for 6 months, would it necessarily have breached one of its duties of sale towards A?
No, there is no duty as to when to sell (Silven Properties).
Wi regards to third party interests in a property, following the sale, what rights is the property subject to or free from?
The m’ee sells subject to any interests that were registered at the time it’s charge was put onto the register. Free from any interests after it’s charge was put on.
What must the m’ee do with the sale proceeds?
The m’ee becomes the trustee of the proceeds of sale and must distribute them in accordance with s105 LPA 1925. Must pay any mortgage with priority other than its own, then costs incurred in the sale, then any other mortgage on the property and the remaining to the m’or.
PBank had the first registered charge against As property. There’s a second charge BBank. PBank has repossessed and sold the property. What is the order of distributing the sale proceeds?
Costs incurred in arranging the sale, itself, anything left to BBank and remaining to m’or.
What other rights does a m’ee have?
- ability to sue m’or if the house is sold for less than is owing
- the right to appoint a receiver (s109 LPA 1925)
- foreclosure
What is the job of the receiver?
To intercept money arising from the land and pay off any interest or capital owed under the mortgage. Usually appointed for commercial properties.
Who would bare the loss if the receiver ran off with the money?
M’or as receivers are treated as an agent of the m’or not the m’ee (s109 LPA 1925).
What happens when an order for foreclosure is made?
M’ee becomes the outright owner of the property regardless of the value of the property. They get to retain any equity in the property, example 100k owing, 40k mortgage, keep the outstanding 60k.
How can a m’ee bring about foreclosure?
Get an order from the court. The first is an order nisi which tells the m’or to pay the money owed within a specified time or foreclosure will take place (usually 6 months). If it’s not paid the order will be made absolute, this frees the owner from any rights.
Can the m’or do anything after the absolute has been granted?
They can apply under s91 LPA 1925 to order a sale of the property instead. The advantage being they get any equity from the sale.
T has a registered legal charge over her house with VBank. Last year she voluntarily handed over possession of her property to the bank after she realised she could no longer afford the mortgage repayments. The bank sold the cottage at market value but failed to recover £10,000 of the original loan. Could it still sue T for this amount, even though she gave it up voluntarily?
Yes.
What is the meaning of the word reasonable period for paying off mortgage arrears?
The whole remaining length of the mortgage term but they must take these into consideration:
- ability of mortgagor to make the payments now and in the future
- likely duration of any temporary financial difficulty
- reason for the arrears
- period remaining of the original mortgage
- value of property measured against the amount owing
What is likely intended to mean with regards to repayment of arrears?
There must be a realistic chance, this must be supported by firm evidence of a detailed budget.
When the mortgagor wants to sell the property himself, what is meant by any sums due?
Repayment of the whole mortgage debt.
What is the meaning of the word likely in terms of selling the house himself?
Mortgagor has to show evidence in support of a sale occurring which will clear the debt.
What is a reasonable period in terms of the owner selling the house himself?
In National & Provincial Building Society v Lloyd it was indicated this could mean up to 1 year but no more. Bristol & West v Ellis said although 1 year was the maximum there was no fixed rule.
If J decided he wanted to ask the court to postpone possession to enable him to sell his property, what is the maximum period of time he is likely to be given to achieve the sale?
6 - 12 months (Bristol & West v Ellis).
In the case of Birmingham Building Society v Caunt, it was recognised that the court had an inherent power to postpone possession. However the court suggested that it could do so only for a very short period of around 28 days. Would a mortgagor ever apply to court under this jurisdiction rather than under the more generous jurisdiction of s36 AJA 1970?
Yes, it would be used by those whom s36 AJA 1970 was not available (communal mortgagor or residential mortgagor whose property has been peaceably repossessed).
Can the court order a sale notwithstanding the lender will be left out of pocket?
S91 LPA 1925 does give a court power to order a sale against the wishes of the mortgagee.
What point did the judge make in the case of Cheltenham and Gloucester v Krauz with regards to s91(2) LPA 1925?
It should only be used by a court in exceptional circumstances. If a mortgagee also wanted a sale they should be allowed to control it to prevent the mortgagor asking too high a price to put off the sale.
What was also said in Krauz about when a mortgagee sought possession under s36 but the mortgagors made an application under s91 to sell themselves?
If the mortgagor wanted to defer possession to sell property himself where it was in negative equity he had to show he had private means to clear the shortfall otherwise s36 could not be used.
What does it mean to say a property is in negative equity?
The market value of the property is less than the mortgage debt.
J wants to sell his house worth £150,000. There is a legal charge over the property in favour of Glass Bank securing a debt of £200,000. M has offered to buy the house but J has no means of payi off the £50,000 that would remain owing. M is not willing to take over this debt. Would J need the consent of the bank to sell?
Yes, as the bank has no obligation to remove the legal charge if it is not cleared.
J is up to date with his mortgage repayments and has offered to repay the outstanding £50,000 after the sale. GBank won’t agree to remove the legal charge. Do the courts have jurisdiction to require GBank to remove the charge from the property if the sale went ahead?
Yes (s91 LPA 1925 allows them to do this; Palk).
Which of the following correctly describes the situation that arose in the case of Palk?
- both the mortgagee and the mortgagor wanted to sell the property
- only the mortgagor wanted to sell the property
Only the mortgagor wanted to sell the property.
In Palk the property was in negative equity and the mortgagee suggested the property should be rented out until the market improved. True or false?
True.
In Palk, the court used its powers under s91 LPA 1925 to order a sale of the property against the wishes of the mortgagee. It said that it needed to do so to avoid manifest unfairness. What did they mean by that?
The mortgagee’s proposal to rent the property would have resulted in the debt significantly growing each year with no certainty when the market would improve and return the property to positive equity.
What is the situation that arose in Barrett v Halifax?
Both the mortgagor and the mortgagee wanted to sell.
In the case of Barrett was the mortgagor in arrears with their mortgage repayments?
Yes.
In the case of Barrett, if the mortgagee and mortgagor both agreed about a sale going ahead why did the mortgagee object to the Barrtt’s selling the property?
It wanted to control the sale given it’s power of sale had arisen as a result of the Barrett’s mortgage arrears.
In the case of Barrett why did the court order a sale under s91 LPA 1925 against the wishes of the mortgagee?
Because an unoccupied property will get a better sale price than a repossessed property.
What is the meaning of the word reasonable period for paying off mortgage arrears?
The whole remaining length of the mortgage term but they must take these into consideration:
- ability of mortgagor to make the payments now and in the future
- likely duration of any temporary financial difficulty
- reason for the arrears
- period remaining of the original mortgage
- value of property measured against the amount owing
What is likely intended to mean with regards to repayment of arrears?
There must be a realistic chance, this must be supported by firm evidence of a detailed budget.
When the mortgagor wants to sell the property himself, what is meant by any sums due?
Repayment of the whole mortgage debt.
What is the meaning of the word likely in terms of selling the house himself?
Mortgagor has to show evidence in support of a sale occurring which will clear the debt.
What is a reasonable period in terms of the owner selling the house himself?
In National & Provincial Building Society v Lloyd it was indicated this could mean up to 1 year but no more. Bristol & West v Ellis said although 1 year was the maximum there was no fixed rule.
If J decided he wanted to ask the court to postpone possession to enable him to sell his property, what is the maximum period of time he is likely to be given to achieve the sale?
6 - 12 months (Bristol & West v Ellis).
In the case of Birmingham Building Society v Caunt, it was recognised that the court had an inherent power to postpone possession. However the court suggested that it could do so only for a very short period of around 28 days. Would a mortgagor ever apply to court under this jurisdiction rather than under the more generous jurisdiction of s36 AJA 1970?
Yes, it would be used by those whom s36 AJA 1970 was not available (communal mortgagor or residential mortgagor whose property has been peaceably repossessed).
Can the court order a sale notwithstanding the lender will be left out of pocket?
S91 LPA 1925 does give a court power to order a sale against the wishes of the mortgagee.
What point did the judge make in the case of Cheltenham and Gloucester v Krauz with regards to s91(2) LPA 1925?
It should only be used by a court in exceptional circumstances. If a mortgagee also wanted a sale they should be allowed to control it to prevent the mortgagor asking too high a price to put off the sale.
What was also said in Krauz about when a mortgagee sought possession under s36 but the mortgagors made an application under s91 to sell themselves?
If the mortgagor wanted to defer possession to sell property himself where it was in negative equity he had to show he had private means to clear the shortfall otherwise s36 could not be used.
What does it mean to say a property is in negative equity?
The market value of the property is less than the mortgage debt.
J wants to sell his house worth £150,000. There is a legal charge over the property in favour of Glass Bank securing a debt of £200,000. M has offered to buy the house but J has no means of payi off the £50,000 that would remain owing. M is not willing to take over this debt. Would J need the consent of the bank to sell?
Yes, as the bank has no obligation to remove the legal charge if it is not cleared.
J is up to date with his mortgage repayments and has offered to repay the outstanding £50,000 after the sale. GBank won’t agree to remove the legal charge. Do the courts have jurisdiction to require GBank to remove the charge from the property if the sale went ahead?
Yes (s91 LPA 1925 allows them to do this; Palk).
Which of the following correctly describes the situation that arose in the case of Palk?
- both the mortgagee and the mortgagor wanted to sell the property
- only the mortgagor wanted to sell the property
Only the mortgagor wanted to sell the property.
In Palk the property was in negative equity and the mortgagee suggested the property should be rented out until the market improved. True or false?
True.
In Palk, the court used its powers under s91 LPA 1925 to order a sale of the property against the wishes of the mortgagee. It said that it needed to do so to avoid manifest unfairness. What did they mean by that?
The mortgagee’s proposal to rent the property would have resulted in the debt significantly growing each year with no certainty when the market would improve and return the property to positive equity.
What is the situation that arose in Barrett v Halifax?
Both the mortgagor and the mortgagee wanted to sell.
In the case of Barrett was the mortgagor in arrears with their mortgage repayments?
Yes.
In the case of Barrett, if the mortgagee and mortgagor both agreed about a sale going ahead why did the mortgagee object to the Barrtt’s selling the property?
It wanted to control the sale given it’s power of sale had arisen as a result of the Barrett’s mortgage arrears.
In the case of Barrett why did the court order a sale under s91 LPA 1925 against the wishes of the mortgagee?
Because an unoccupied property will get a better sale price than a repossessed property.
What is the meaning of the word reasonable period for paying off mortgage arrears?
The whole remaining length of the mortgage term but they must take these into consideration:
- ability of mortgagor to make the payments now and in the future
- likely duration of any temporary financial difficulty
- reason for the arrears
- period remaining of the original mortgage
- value of property measured against the amount owing
What is likely intended to mean with regards to repayment of arrears?
There must be a realistic chance, this must be supported by firm evidence of a detailed budget.
When the mortgagor wants to sell the property himself, what is meant by any sums due?
Repayment of the whole mortgage debt.
What is the meaning of the word likely in terms of selling the house himself?
Mortgagor has to show evidence in support of a sale occurring which will clear the debt.
What is a reasonable period in terms of the owner selling the house himself?
In National & Provincial Building Society v Lloyd it was indicated this could mean up to 1 year but no more. Bristol & West v Ellis said although 1 year was the maximum there was no fixed rule.
If J decided he wanted to ask the court to postpone possession to enable him to sell his property, what is the maximum period of time he is likely to be given to achieve the sale?
6 - 12 months (Bristol & West v Ellis).
In the case of Birmingham Building Society v Caunt, it was recognised that the court had an inherent power to postpone possession. However the court suggested that it could do so only for a very short period of around 28 days. Would a mortgagor ever apply to court under this jurisdiction rather than under the more generous jurisdiction of s36 AJA 1970?
Yes, it would be used by those whom s36 AJA 1970 was not available (communal mortgagor or residential mortgagor whose property has been peaceably repossessed).
Can the court order a sale notwithstanding the lender will be left out of pocket?
S91 LPA 1925 does give a court power to order a sale against the wishes of the mortgagee.
What point did the judge make in the case of Cheltenham and Gloucester v Krauz with regards to s91(2) LPA 1925?
It should only be used by a court in exceptional circumstances. If a mortgagee also wanted a sale they should be allowed to control it to prevent the mortgagor asking too high a price to put off the sale.
What was also said in Krauz about when a mortgagee sought possession under s36 but the mortgagors made an application under s91 to sell themselves?
If the mortgagor wanted to defer possession to sell property himself where it was in negative equity he had to show he had private means to clear the shortfall otherwise s36 could not be used.
What does it mean to say a property is in negative equity?
The market value of the property is less than the mortgage debt.
J wants to sell his house worth £150,000. There is a legal charge over the property in favour of Glass Bank securing a debt of £200,000. M has offered to buy the house but J has no means of payi off the £50,000 that would remain owing. M is not willing to take over this debt. Would J need the consent of the bank to sell?
Yes, as the bank has no obligation to remove the legal charge if it is not cleared.
J is up to date with his mortgage repayments and has offered to repay the outstanding £50,000 after the sale. GBank won’t agree to remove the legal charge. Do the courts have jurisdiction to require GBank to remove the charge from the property if the sale went ahead?
Yes (s91 LPA 1925 allows them to do this; Palk).
Which of the following correctly describes the situation that arose in the case of Palk?
- both the mortgagee and the mortgagor wanted to sell the property
- only the mortgagor wanted to sell the property
Only the mortgagor wanted to sell the property.
In Palk the property was in negative equity and the mortgagee suggested the property should be rented out until the market improved. True or false?
True.
In Palk, the court used its powers under s91 LPA 1925 to order a sale of the property against the wishes of the mortgagee. It said that it needed to do so to avoid manifest unfairness. What did they mean by that?
The mortgagee’s proposal to rent the property would have resulted in the debt significantly growing each year with no certainty when the market would improve and return the property to positive equity.
What is the situation that arose in Barrett v Halifax?
Both the mortgagor and the mortgagee wanted to sell.
In the case of Barrett was the mortgagor in arrears with their mortgage repayments?
Yes.
In the case of Barrett, if the mortgagee and mortgagor both agreed about a sale going ahead why did the mortgagee object to the Barrtt’s selling the property?
It wanted to control the sale given it’s power of sale had arisen as a result of the Barrett’s mortgage arrears.
In the case of Barrett why did the court order a sale under s91 LPA 1925 against the wishes of the mortgagee?
Because an unoccupied property will get a better sale price than a repossessed property.
What is the meaning of the word reasonable period for paying off mortgage arrears?
The whole remaining length of the mortgage term but they must take these into consideration:
- ability of mortgagor to make the payments now and in the future
- likely duration of any temporary financial difficulty
- reason for the arrears
- period remaining of the original mortgage
- value of property measured against the amount owing
What is likely intended to mean with regards to repayment of arrears?
There must be a realistic chance, this must be supported by firm evidence of a detailed budget.
When the mortgagor wants to sell the property himself, what is meant by any sums due?
Repayment of the whole mortgage debt.
What is the meaning of the word likely in terms of selling the house himself?
Mortgagor has to show evidence in support of a sale occurring which will clear the debt.
What is a reasonable period in terms of the owner selling the house himself?
In National & Provincial Building Society v Lloyd it was indicated this could mean up to 1 year but no more. Bristol & West v Ellis said although 1 year was the maximum there was no fixed rule.
If J decided he wanted to ask the court to postpone possession to enable him to sell his property, what is the maximum period of time he is likely to be given to achieve the sale?
6 - 12 months (Bristol & West v Ellis).
In the case of Birmingham Building Society v Caunt, it was recognised that the court had an inherent power to postpone possession. However the court suggested that it could do so only for a very short period of around 28 days. Would a mortgagor ever apply to court under this jurisdiction rather than under the more generous jurisdiction of s36 AJA 1970?
Yes, it would be used by those whom s36 AJA 1970 was not available (communal mortgagor or residential mortgagor whose property has been peaceably repossessed).
Can the court order a sale notwithstanding the lender will be left out of pocket?
S91 LPA 1925 does give a court power to order a sale against the wishes of the mortgagee.
What point did the judge make in the case of Cheltenham and Gloucester v Krauz with regards to s91(2) LPA 1925?
It should only be used by a court in exceptional circumstances. If a mortgagee also wanted a sale they should be allowed to control it to prevent the mortgagor asking too high a price to put off the sale.
What was also said in Krauz about when a mortgagee sought possession under s36 but the mortgagors made an application under s91 to sell themselves?
If the mortgagor wanted to defer possession to sell property himself where it was in negative equity he had to show he had private means to clear the shortfall otherwise s36 could not be used.
What does it mean to say a property is in negative equity?
The market value of the property is less than the mortgage debt.
J wants to sell his house worth £150,000. There is a legal charge over the property in favour of Glass Bank securing a debt of £200,000. M has offered to buy the house but J has no means of payi off the £50,000 that would remain owing. M is not willing to take over this debt. Would J need the consent of the bank to sell?
Yes, as the bank has no obligation to remove the legal charge if it is not cleared.
J is up to date with his mortgage repayments and has offered to repay the outstanding £50,000 after the sale. GBank won’t agree to remove the legal charge. Do the courts have jurisdiction to require GBank to remove the charge from the property if the sale went ahead?
Yes (s91 LPA 1925 allows them to do this; Palk).
Which of the following correctly describes the situation that arose in the case of Palk?
- both the mortgagee and the mortgagor wanted to sell the property
- only the mortgagor wanted to sell the property
Only the mortgagor wanted to sell the property.
In Palk the property was in negative equity and the mortgagee suggested the property should be rented out until the market improved. True or false?
True.
In Palk, the court used its powers under s91 LPA 1925 to order a sale of the property against the wishes of the mortgagee. It said that it needed to do so to avoid manifest unfairness. What did they mean by that?
The mortgagee’s proposal to rent the property would have resulted in the debt significantly growing each year with no certainty when the market would improve and return the property to positive equity.
What is the situation that arose in Barrett v Halifax?
Both the mortgagor and the mortgagee wanted to sell.
In the case of Barrett was the mortgagor in arrears with their mortgage repayments?
Yes.
In the case of Barrett, if the mortgagee and mortgagor both agreed about a sale going ahead why did the mortgagee object to the Barrtt’s selling the property?
It wanted to control the sale given it’s power of sale had arisen as a result of the Barrett’s mortgage arrears.
In the case of Barrett why did the court order a sale under s91 LPA 1925 against the wishes of the mortgagee?
Because an unoccupied property will get a better sale price than a repossessed property.
What is the meaning of the word reasonable period for paying off mortgage arrears?
The whole remaining length of the mortgage term but they must take these into consideration:
- ability of mortgagor to make the payments now and in the future
- likely duration of any temporary financial difficulty
- reason for the arrears
- period remaining of the original mortgage
- value of property measured against the amount owing
What is likely intended to mean with regards to repayment of arrears?
There must be a realistic chance, this must be supported by firm evidence of a detailed budget.
When the mortgagor wants to sell the property himself, what is meant by any sums due?
Repayment of the whole mortgage debt.
What is the meaning of the word likely in terms of selling the house himself?
Mortgagor has to show evidence in support of a sale occurring which will clear the debt.
What is a reasonable period in terms of the owner selling the house himself?
In National & Provincial Building Society v Lloyd it was indicated this could mean up to 1 year but no more. Bristol & West v Ellis said although 1 year was the maximum there was no fixed rule.
If J decided he wanted to ask the court to postpone possession to enable him to sell his property, what is the maximum period of time he is likely to be given to achieve the sale?
6 - 12 months (Bristol & West v Ellis).
In the case of Birmingham Building Society v Caunt, it was recognised that the court had an inherent power to postpone possession. However the court suggested that it could do so only for a very short period of around 28 days. Would a mortgagor ever apply to court under this jurisdiction rather than under the more generous jurisdiction of s36 AJA 1970?
Yes, it would be used by those whom s36 AJA 1970 was not available (communal mortgagor or residential mortgagor whose property has been peaceably repossessed).
Can the court order a sale notwithstanding the lender will be left out of pocket?
S91 LPA 1925 does give a court power to order a sale against the wishes of the mortgagee.
What point did the judge make in the case of Cheltenham and Gloucester v Krauz with regards to s91(2) LPA 1925?
It should only be used by a court in exceptional circumstances. If a mortgagee also wanted a sale they should be allowed to control it to prevent the mortgagor asking too high a price to put off the sale.
What was also said in Krauz about when a mortgagee sought possession under s36 but the mortgagors made an application under s91 to sell themselves?
If the mortgagor wanted to defer possession to sell property himself where it was in negative equity he had to show he had private means to clear the shortfall otherwise s36 could not be used.
What does it mean to say a property is in negative equity?
The market value of the property is less than the mortgage debt.
J wants to sell his house worth £150,000. There is a legal charge over the property in favour of Glass Bank securing a debt of £200,000. M has offered to buy the house but J has no means of payi off the £50,000 that would remain owing. M is not willing to take over this debt. Would J need the consent of the bank to sell?
Yes, as the bank has no obligation to remove the legal charge if it is not cleared.
J is up to date with his mortgage repayments and has offered to repay the outstanding £50,000 after the sale. GBank won’t agree to remove the legal charge. Do the courts have jurisdiction to require GBank to remove the charge from the property if the sale went ahead?
Yes (s91 LPA 1925 allows them to do this; Palk).
Which of the following correctly describes the situation that arose in the case of Palk?
- both the mortgagee and the mortgagor wanted to sell the property
- only the mortgagor wanted to sell the property
Only the mortgagor wanted to sell the property.
In Palk the property was in negative equity and the mortgagee suggested the property should be rented out until the market improved. True or false?
True.
In Palk, the court used its powers under s91 LPA 1925 to order a sale of the property against the wishes of the mortgagee. It said that it needed to do so to avoid manifest unfairness. What did they mean by that?
The mortgagee’s proposal to rent the property would have resulted in the debt significantly growing each year with no certainty when the market would improve and return the property to positive equity.
What is the situation that arose in Barrett v Halifax?
Both the mortgagor and the mortgagee wanted to sell.
In the case of Barrett was the mortgagor in arrears with their mortgage repayments?
Yes.
In the case of Barrett, if the mortgagee and mortgagor both agreed about a sale going ahead why did the mortgagee object to the Barrtt’s selling the property?
It wanted to control the sale given it’s power of sale had arisen as a result of the Barrett’s mortgage arrears.
In the case of Barrett why did the court order a sale under s91 LPA 1925 against the wishes of the mortgagee?
Because an unoccupied property will get a better sale price than a repossessed property.
What is the meaning of the word reasonable period for paying off mortgage arrears?
The whole remaining length of the mortgage term but they must take these into consideration:
- ability of mortgagor to make the payments now and in the future
- likely duration of any temporary financial difficulty
- reason for the arrears
- period remaining of the original mortgage
- value of property measured against the amount owing
What is likely intended to mean with regards to repayment of arrears?
There must be a realistic chance, this must be supported by firm evidence of a detailed budget.
When the mortgagor wants to sell the property himself, what is meant by any sums due?
Repayment of the whole mortgage debt.
What is the meaning of the word likely in terms of selling the house himself?
Mortgagor has to show evidence in support of a sale occurring which will clear the debt.
What is a reasonable period in terms of the owner selling the house himself?
In National & Provincial Building Society v Lloyd it was indicated this could mean up to 1 year but no more. Bristol & West v Ellis said although 1 year was the maximum there was no fixed rule.
If J decided he wanted to ask the court to postpone possession to enable him to sell his property, what is the maximum period of time he is likely to be given to achieve the sale?
6 - 12 months (Bristol & West v Ellis).
In the case of Birmingham Building Society v Caunt, it was recognised that the court had an inherent power to postpone possession. However the court suggested that it could do so only for a very short period of around 28 days. Would a mortgagor ever apply to court under this jurisdiction rather than under the more generous jurisdiction of s36 AJA 1970?
Yes, it would be used by those whom s36 AJA 1970 was not available (communal mortgagor or residential mortgagor whose property has been peaceably repossessed).
Can the court order a sale notwithstanding the lender will be left out of pocket?
S91 LPA 1925 does give a court power to order a sale against the wishes of the mortgagee.
What point did the judge make in the case of Cheltenham and Gloucester v Krauz with regards to s91(2) LPA 1925?
It should only be used by a court in exceptional circumstances. If a mortgagee also wanted a sale they should be allowed to control it to prevent the mortgagor asking too high a price to put off the sale.
What was also said in Krauz about when a mortgagee sought possession under s36 but the mortgagors made an application under s91 to sell themselves?
If the mortgagor wanted to defer possession to sell property himself where it was in negative equity he had to show he had private means to clear the shortfall otherwise s36 could not be used.
What does it mean to say a property is in negative equity?
The market value of the property is less than the mortgage debt.
J wants to sell his house worth £150,000. There is a legal charge over the property in favour of Glass Bank securing a debt of £200,000. M has offered to buy the house but J has no means of payi off the £50,000 that would remain owing. M is not willing to take over this debt. Would J need the consent of the bank to sell?
Yes, as the bank has no obligation to remove the legal charge if it is not cleared.
J is up to date with his mortgage repayments and has offered to repay the outstanding £50,000 after the sale. GBank won’t agree to remove the legal charge. Do the courts have jurisdiction to require GBank to remove the charge from the property if the sale went ahead?
Yes (s91 LPA 1925 allows them to do this; Palk).
Which of the following correctly describes the situation that arose in the case of Palk?
- both the mortgagee and the mortgagor wanted to sell the property
- only the mortgagor wanted to sell the property
Only the mortgagor wanted to sell the property.
In Palk the property was in negative equity and the mortgagee suggested the property should be rented out until the market improved. True or false?
True.
In Palk, the court used its powers under s91 LPA 1925 to order a sale of the property against the wishes of the mortgagee. It said that it needed to do so to avoid manifest unfairness. What did they mean by that?
The mortgagee’s proposal to rent the property would have resulted in the debt significantly growing each year with no certainty when the market would improve and return the property to positive equity.
What is the situation that arose in Barrett v Halifax?
Both the mortgagor and the mortgagee wanted to sell.
In the case of Barrett was the mortgagor in arrears with their mortgage repayments?
Yes.
In the case of Barrett, if the mortgagee and mortgagor both agreed about a sale going ahead why did the mortgagee object to the Barrtt’s selling the property?
It wanted to control the sale given it’s power of sale had arisen as a result of the Barrett’s mortgage arrears.
In the case of Barrett why did the court order a sale under s91 LPA 1925 against the wishes of the mortgagee?
Because an unoccupied property will get a better sale price than a repossessed property.
What is the meaning of the word reasonable period for paying off mortgage arrears?
The whole remaining length of the mortgage term but they must take these into consideration:
- ability of mortgagor to make the payments now and in the future
- likely duration of any temporary financial difficulty
- reason for the arrears
- period remaining of the original mortgage
- value of property measured against the amount owing
What is likely intended to mean with regards to repayment of arrears?
There must be a realistic chance, this must be supported by firm evidence of a detailed budget.
When the mortgagor wants to sell the property himself, what is meant by any sums due?
Repayment of the whole mortgage debt.
What is the meaning of the word likely in terms of selling the house himself?
Mortgagor has to show evidence in support of a sale occurring which will clear the debt.
What is a reasonable period in terms of the owner selling the house himself?
In National & Provincial Building Society v Lloyd it was indicated this could mean up to 1 year but no more. Bristol & West v Ellis said although 1 year was the maximum there was no fixed rule.
If J decided he wanted to ask the court to postpone possession to enable him to sell his property, what is the maximum period of time he is likely to be given to achieve the sale?
6 - 12 months (Bristol & West v Ellis).
In the case of Birmingham Building Society v Caunt, it was recognised that the court had an inherent power to postpone possession. However the court suggested that it could do so only for a very short period of around 28 days. Would a mortgagor ever apply to court under this jurisdiction rather than under the more generous jurisdiction of s36 AJA 1970?
Yes, it would be used by those whom s36 AJA 1970 was not available (communal mortgagor or residential mortgagor whose property has been peaceably repossessed).
Can the court order a sale notwithstanding the lender will be left out of pocket?
S91 LPA 1925 does give a court power to order a sale against the wishes of the mortgagee.
What point did the judge make in the case of Cheltenham and Gloucester v Krauz with regards to s91(2) LPA 1925?
It should only be used by a court in exceptional circumstances. If a mortgagee also wanted a sale they should be allowed to control it to prevent the mortgagor asking too high a price to put off the sale.
What was also said in Krauz about when a mortgagee sought possession under s36 but the mortgagors made an application under s91 to sell themselves?
If the mortgagor wanted to defer possession to sell property himself where it was in negative equity he had to show he had private means to clear the shortfall otherwise s36 could not be used.
What does it mean to say a property is in negative equity?
The market value of the property is less than the mortgage debt.
J wants to sell his house worth £150,000. There is a legal charge over the property in favour of Glass Bank securing a debt of £200,000. M has offered to buy the house but J has no means of payi off the £50,000 that would remain owing. M is not willing to take over this debt. Would J need the consent of the bank to sell?
Yes, as the bank has no obligation to remove the legal charge if it is not cleared.
J is up to date with his mortgage repayments and has offered to repay the outstanding £50,000 after the sale. GBank won’t agree to remove the legal charge. Do the courts have jurisdiction to require GBank to remove the charge from the property if the sale went ahead?
Yes (s91 LPA 1925 allows them to do this; Palk).
Which of the following correctly describes the situation that arose in the case of Palk?
- both the mortgagee and the mortgagor wanted to sell the property
- only the mortgagor wanted to sell the property
Only the mortgagor wanted to sell the property.
In Palk the property was in negative equity and the mortgagee suggested the property should be rented out until the market improved. True or false?
True.
In Palk, the court used its powers under s91 LPA 1925 to order a sale of the property against the wishes of the mortgagee. It said that it needed to do so to avoid manifest unfairness. What did they mean by that?
The mortgagee’s proposal to rent the property would have resulted in the debt significantly growing each year with no certainty when the market would improve and return the property to positive equity.
What is the situation that arose in Barrett v Halifax?
Both the mortgagor and the mortgagee wanted to sell.
In the case of Barrett was the mortgagor in arrears with their mortgage repayments?
Yes.
In the case of Barrett, if the mortgagee and mortgagor both agreed about a sale going ahead why did the mortgagee object to the Barrtt’s selling the property?
It wanted to control the sale given it’s power of sale had arisen as a result of the Barrett’s mortgage arrears.
In the case of Barrett why did the court order a sale under s91 LPA 1925 against the wishes of the mortgagee?
Because an unoccupied property will get a better sale price than a repossessed property.
What is the meaning of the word reasonable period for paying off mortgage arrears?
The whole remaining length of the mortgage term but they must take these into consideration:
- ability of mortgagor to make the payments now and in the future
- likely duration of any temporary financial difficulty
- reason for the arrears
- period remaining of the original mortgage
- value of property measured against the amount owing
What is likely intended to mean with regards to repayment of arrears?
There must be a realistic chance, this must be supported by firm evidence of a detailed budget.
When the mortgagor wants to sell the property himself, what is meant by any sums due?
Repayment of the whole mortgage debt.
What is the meaning of the word likely in terms of selling the house himself?
Mortgagor has to show evidence in support of a sale occurring which will clear the debt.
What is a reasonable period in terms of the owner selling the house himself?
In National & Provincial Building Society v Lloyd it was indicated this could mean up to 1 year but no more. Bristol & West v Ellis said although 1 year was the maximum there was no fixed rule.
If J decided he wanted to ask the court to postpone possession to enable him to sell his property, what is the maximum period of time he is likely to be given to achieve the sale?
6 - 12 months (Bristol & West v Ellis).
In the case of Birmingham Building Society v Caunt, it was recognised that the court had an inherent power to postpone possession. However the court suggested that it could do so only for a very short period of around 28 days. Would a mortgagor ever apply to court under this jurisdiction rather than under the more generous jurisdiction of s36 AJA 1970?
Yes, it would be used by those whom s36 AJA 1970 was not available (communal mortgagor or residential mortgagor whose property has been peaceably repossessed).
Can the court order a sale notwithstanding the lender will be left out of pocket?
S91 LPA 1925 does give a court power to order a sale against the wishes of the mortgagee.
What point did the judge make in the case of Cheltenham and Gloucester v Krauz with regards to s91(2) LPA 1925?
It should only be used by a court in exceptional circumstances. If a mortgagee also wanted a sale they should be allowed to control it to prevent the mortgagor asking too high a price to put off the sale.
What was also said in Krauz about when a mortgagee sought possession under s36 but the mortgagors made an application under s91 to sell themselves?
If the mortgagor wanted to defer possession to sell property himself where it was in negative equity he had to show he had private means to clear the shortfall otherwise s36 could not be used.
What does it mean to say a property is in negative equity?
The market value of the property is less than the mortgage debt.
J wants to sell his house worth £150,000. There is a legal charge over the property in favour of Glass Bank securing a debt of £200,000. M has offered to buy the house but J has no means of payi off the £50,000 that would remain owing. M is not willing to take over this debt. Would J need the consent of the bank to sell?
Yes, as the bank has no obligation to remove the legal charge if it is not cleared.
J is up to date with his mortgage repayments and has offered to repay the outstanding £50,000 after the sale. GBank won’t agree to remove the legal charge. Do the courts have jurisdiction to require GBank to remove the charge from the property if the sale went ahead?
Yes (s91 LPA 1925 allows them to do this; Palk).
Which of the following correctly describes the situation that arose in the case of Palk?
- both the mortgagee and the mortgagor wanted to sell the property
- only the mortgagor wanted to sell the property
Only the mortgagor wanted to sell the property.
In Palk the property was in negative equity and the mortgagee suggested the property should be rented out until the market improved. True or false?
True.
In Palk, the court used its powers under s91 LPA 1925 to order a sale of the property against the wishes of the mortgagee. It said that it needed to do so to avoid manifest unfairness. What did they mean by that?
The mortgagee’s proposal to rent the property would have resulted in the debt significantly growing each year with no certainty when the market would improve and return the property to positive equity.
What is the situation that arose in Barrett v Halifax?
Both the mortgagor and the mortgagee wanted to sell.
In the case of Barrett was the mortgagor in arrears with their mortgage repayments?
Yes.
In the case of Barrett, if the mortgagee and mortgagor both agreed about a sale going ahead why did the mortgagee object to the Barrtt’s selling the property?
It wanted to control the sale given it’s power of sale had arisen as a result of the Barrett’s mortgage arrears.
In the case of Barrett why did the court order a sale under s91 LPA 1925 against the wishes of the mortgagee?
Because an unoccupied property will get a better sale price than a repossessed property.
What is the meaning of the word reasonable period for paying off mortgage arrears?
The whole remaining length of the mortgage term but they must take these into consideration:
- ability of mortgagor to make the payments now and in the future
- likely duration of any temporary financial difficulty
- reason for the arrears
- period remaining of the original mortgage
- value of property measured against the amount owing
What is likely intended to mean with regards to repayment of arrears?
There must be a realistic chance, this must be supported by firm evidence of a detailed budget.
When the mortgagor wants to sell the property himself, what is meant by any sums due?
Repayment of the whole mortgage debt.
What is the meaning of the word likely in terms of selling the house himself?
Mortgagor has to show evidence in support of a sale occurring which will clear the debt.
What is a reasonable period in terms of the owner selling the house himself?
In National & Provincial Building Society v Lloyd it was indicated this could mean up to 1 year but no more. Bristol & West v Ellis said although 1 year was the maximum there was no fixed rule.
If J decided he wanted to ask the court to postpone possession to enable him to sell his property, what is the maximum period of time he is likely to be given to achieve the sale?
6 - 12 months (Bristol & West v Ellis).
In the case of Birmingham Building Society v Caunt, it was recognised that the court had an inherent power to postpone possession. However the court suggested that it could do so only for a very short period of around 28 days. Would a mortgagor ever apply to court under this jurisdiction rather than under the more generous jurisdiction of s36 AJA 1970?
Yes, it would be used by those whom s36 AJA 1970 was not available (communal mortgagor or residential mortgagor whose property has been peaceably repossessed).
Can the court order a sale notwithstanding the lender will be left out of pocket?
S91 LPA 1925 does give a court power to order a sale against the wishes of the mortgagee.
What point did the judge make in the case of Cheltenham and Gloucester v Krauz with regards to s91(2) LPA 1925?
It should only be used by a court in exceptional circumstances. If a mortgagee also wanted a sale they should be allowed to control it to prevent the mortgagor asking too high a price to put off the sale.
What was also said in Krauz about when a mortgagee sought possession under s36 but the mortgagors made an application under s91 to sell themselves?
If the mortgagor wanted to defer possession to sell property himself where it was in negative equity he had to show he had private means to clear the shortfall otherwise s36 could not be used.
What does it mean to say a property is in negative equity?
The market value of the property is less than the mortgage debt.
J wants to sell his house worth £150,000. There is a legal charge over the property in favour of Glass Bank securing a debt of £200,000. M has offered to buy the house but J has no means of payi off the £50,000 that would remain owing. M is not willing to take over this debt. Would J need the consent of the bank to sell?
Yes, as the bank has no obligation to remove the legal charge if it is not cleared.
J is up to date with his mortgage repayments and has offered to repay the outstanding £50,000 after the sale. GBank won’t agree to remove the legal charge. Do the courts have jurisdiction to require GBank to remove the charge from the property if the sale went ahead?
Yes (s91 LPA 1925 allows them to do this; Palk).
Which of the following correctly describes the situation that arose in the case of Palk?
- both the mortgagee and the mortgagor wanted to sell the property
- only the mortgagor wanted to sell the property
Only the mortgagor wanted to sell the property.
In Palk the property was in negative equity and the mortgagee suggested the property should be rented out until the market improved. True or false?
True.
In Palk, the court used its powers under s91 LPA 1925 to order a sale of the property against the wishes of the mortgagee. It said that it needed to do so to avoid manifest unfairness. What did they mean by that?
The mortgagee’s proposal to rent the property would have resulted in the debt significantly growing each year with no certainty when the market would improve and return the property to positive equity.
What is the situation that arose in Barrett v Halifax?
Both the mortgagor and the mortgagee wanted to sell.
In the case of Barrett was the mortgagor in arrears with their mortgage repayments?
Yes.
In the case of Barrett, if the mortgagee and mortgagor both agreed about a sale going ahead why did the mortgagee object to the Barrtt’s selling the property?
It wanted to control the sale given it’s power of sale had arisen as a result of the Barrett’s mortgage arrears.
In the case of Barrett why did the court order a sale under s91 LPA 1925 against the wishes of the mortgagee?
Because an unoccupied property will get a better sale price than a repossessed property.
What is the meaning of the word reasonable period for paying off mortgage arrears?
The whole remaining length of the mortgage term but they must take these into consideration:
- ability of mortgagor to make the payments now and in the future
- likely duration of any temporary financial difficulty
- reason for the arrears
- period remaining of the original mortgage
- value of property measured against the amount owing
What is likely intended to mean with regards to repayment of arrears?
There must be a realistic chance, this must be supported by firm evidence of a detailed budget.
When the mortgagor wants to sell the property himself, what is meant by any sums due?
Repayment of the whole mortgage debt.
What is the meaning of the word likely in terms of selling the house himself?
Mortgagor has to show evidence in support of a sale occurring which will clear the debt.
What is a reasonable period in terms of the owner selling the house himself?
In National & Provincial Building Society v Lloyd it was indicated this could mean up to 1 year but no more. Bristol & West v Ellis said although 1 year was the maximum there was no fixed rule.
If J decided he wanted to ask the court to postpone possession to enable him to sell his property, what is the maximum period of time he is likely to be given to achieve the sale?
6 - 12 months (Bristol & West v Ellis).
In the case of Birmingham Building Society v Caunt, it was recognised that the court had an inherent power to postpone possession. However the court suggested that it could do so only for a very short period of around 28 days. Would a mortgagor ever apply to court under this jurisdiction rather than under the more generous jurisdiction of s36 AJA 1970?
Yes, it would be used by those whom s36 AJA 1970 was not available (communal mortgagor or residential mortgagor whose property has been peaceably repossessed).
Can the court order a sale notwithstanding the lender will be left out of pocket?
S91 LPA 1925 does give a court power to order a sale against the wishes of the mortgagee.
What point did the judge make in the case of Cheltenham and Gloucester v Krauz with regards to s91(2) LPA 1925?
It should only be used by a court in exceptional circumstances. If a mortgagee also wanted a sale they should be allowed to control it to prevent the mortgagor asking too high a price to put off the sale.
What was also said in Krauz about when a mortgagee sought possession under s36 but the mortgagors made an application under s91 to sell themselves?
If the mortgagor wanted to defer possession to sell property himself where it was in negative equity he had to show he had private means to clear the shortfall otherwise s36 could not be used.
What does it mean to say a property is in negative equity?
The market value of the property is less than the mortgage debt.
J wants to sell his house worth £150,000. There is a legal charge over the property in favour of Glass Bank securing a debt of £200,000. M has offered to buy the house but J has no means of payi off the £50,000 that would remain owing. M is not willing to take over this debt. Would J need the consent of the bank to sell?
Yes, as the bank has no obligation to remove the legal charge if it is not cleared.
J is up to date with his mortgage repayments and has offered to repay the outstanding £50,000 after the sale. GBank won’t agree to remove the legal charge. Do the courts have jurisdiction to require GBank to remove the charge from the property if the sale went ahead?
Yes (s91 LPA 1925 allows them to do this; Palk).
Which of the following correctly describes the situation that arose in the case of Palk?
- both the mortgagee and the mortgagor wanted to sell the property
- only the mortgagor wanted to sell the property
Only the mortgagor wanted to sell the property.
In Palk the property was in negative equity and the mortgagee suggested the property should be rented out until the market improved. True or false?
True.
In Palk, the court used its powers under s91 LPA 1925 to order a sale of the property against the wishes of the mortgagee. It said that it needed to do so to avoid manifest unfairness. What did they mean by that?
The mortgagee’s proposal to rent the property would have resulted in the debt significantly growing each year with no certainty when the market would improve and return the property to positive equity.
What is the situation that arose in Barrett v Halifax?
Both the mortgagor and the mortgagee wanted to sell.
In the case of Barrett was the mortgagor in arrears with their mortgage repayments?
Yes.
In the case of Barrett, if the mortgagee and mortgagor both agreed about a sale going ahead why did the mortgagee object to the Barrtt’s selling the property?
It wanted to control the sale given it’s power of sale had arisen as a result of the Barrett’s mortgage arrears.
In the case of Barrett why did the court order a sale under s91 LPA 1925 against the wishes of the mortgagee?
Because an unoccupied property will get a better sale price than a repossessed property.
What is the meaning of the word reasonable period for paying off mortgage arrears?
The whole remaining length of the mortgage term but they must take these into consideration:
- ability of mortgagor to make the payments now and in the future
- likely duration of any temporary financial difficulty
- reason for the arrears
- period remaining of the original mortgage
- value of property measured against the amount owing
What is likely intended to mean with regards to repayment of arrears?
There must be a realistic chance, this must be supported by firm evidence of a detailed budget.
When the mortgagor wants to sell the property himself, what is meant by any sums due?
Repayment of the whole mortgage debt.
What is the meaning of the word likely in terms of selling the house himself?
Mortgagor has to show evidence in support of a sale occurring which will clear the debt.
What is a reasonable period in terms of the owner selling the house himself?
In National & Provincial Building Society v Lloyd it was indicated this could mean up to 1 year but no more. Bristol & West v Ellis said although 1 year was the maximum there was no fixed rule.
If J decided he wanted to ask the court to postpone possession to enable him to sell his property, what is the maximum period of time he is likely to be given to achieve the sale?
6 - 12 months (Bristol & West v Ellis).
In the case of Birmingham Building Society v Caunt, it was recognised that the court had an inherent power to postpone possession. However the court suggested that it could do so only for a very short period of around 28 days. Would a mortgagor ever apply to court under this jurisdiction rather than under the more generous jurisdiction of s36 AJA 1970?
Yes, it would be used by those whom s36 AJA 1970 was not available (communal mortgagor or residential mortgagor whose property has been peaceably repossessed).
Can the court order a sale notwithstanding the lender will be left out of pocket?
S91 LPA 1925 does give a court power to order a sale against the wishes of the mortgagee.
What point did the judge make in the case of Cheltenham and Gloucester v Krauz with regards to s91(2) LPA 1925?
It should only be used by a court in exceptional circumstances. If a mortgagee also wanted a sale they should be allowed to control it to prevent the mortgagor asking too high a price to put off the sale.
What was also said in Krauz about when a mortgagee sought possession under s36 but the mortgagors made an application under s91 to sell themselves?
If the mortgagor wanted to defer possession to sell property himself where it was in negative equity he had to show he had private means to clear the shortfall otherwise s36 could not be used.
What does it mean to say a property is in negative equity?
The market value of the property is less than the mortgage debt.
J wants to sell his house worth £150,000. There is a legal charge over the property in favour of Glass Bank securing a debt of £200,000. M has offered to buy the house but J has no means of payi off the £50,000 that would remain owing. M is not willing to take over this debt. Would J need the consent of the bank to sell?
Yes, as the bank has no obligation to remove the legal charge if it is not cleared.
J is up to date with his mortgage repayments and has offered to repay the outstanding £50,000 after the sale. GBank won’t agree to remove the legal charge. Do the courts have jurisdiction to require GBank to remove the charge from the property if the sale went ahead?
Yes (s91 LPA 1925 allows them to do this; Palk).
Which of the following correctly describes the situation that arose in the case of Palk?
- both the mortgagee and the mortgagor wanted to sell the property
- only the mortgagor wanted to sell the property
Only the mortgagor wanted to sell the property.
In Palk the property was in negative equity and the mortgagee suggested the property should be rented out until the market improved. True or false?
True.
In Palk, the court used its powers under s91 LPA 1925 to order a sale of the property against the wishes of the mortgagee. It said that it needed to do so to avoid manifest unfairness. What did they mean by that?
The mortgagee’s proposal to rent the property would have resulted in the debt significantly growing each year with no certainty when the market would improve and return the property to positive equity.
What is the situation that arose in Barrett v Halifax?
Both the mortgagor and the mortgagee wanted to sell.
In the case of Barrett was the mortgagor in arrears with their mortgage repayments?
Yes.
In the case of Barrett, if the mortgagee and mortgagor both agreed about a sale going ahead why did the mortgagee object to the Barrtt’s selling the property?
It wanted to control the sale given it’s power of sale had arisen as a result of the Barrett’s mortgage arrears.
In the case of Barrett why did the court order a sale under s91 LPA 1925 against the wishes of the mortgagee?
Because an unoccupied property will get a better sale price than a repossessed property.
What is the meaning of the word reasonable period for paying off mortgage arrears?
The whole remaining length of the mortgage term but they must take these into consideration:
- ability of mortgagor to make the payments now and in the future
- likely duration of any temporary financial difficulty
- reason for the arrears
- period remaining of the original mortgage
- value of property measured against the amount owing
What is likely intended to mean with regards to repayment of arrears?
There must be a realistic chance, this must be supported by firm evidence of a detailed budget.
When the mortgagor wants to sell the property himself, what is meant by any sums due?
Repayment of the whole mortgage debt.
What is the meaning of the word likely in terms of selling the house himself?
Mortgagor has to show evidence in support of a sale occurring which will clear the debt.
What is a reasonable period in terms of the owner selling the house himself?
In National & Provincial Building Society v Lloyd it was indicated this could mean up to 1 year but no more. Bristol & West v Ellis said although 1 year was the maximum there was no fixed rule.
If J decided he wanted to ask the court to postpone possession to enable him to sell his property, what is the maximum period of time he is likely to be given to achieve the sale?
6 - 12 months (Bristol & West v Ellis).
In the case of Birmingham Building Society v Caunt, it was recognised that the court had an inherent power to postpone possession. However the court suggested that it could do so only for a very short period of around 28 days. Would a mortgagor ever apply to court under this jurisdiction rather than under the more generous jurisdiction of s36 AJA 1970?
Yes, it would be used by those whom s36 AJA 1970 was not available (communal mortgagor or residential mortgagor whose property has been peaceably repossessed).
Can the court order a sale notwithstanding the lender will be left out of pocket?
S91 LPA 1925 does give a court power to order a sale against the wishes of the mortgagee.
What point did the judge make in the case of Cheltenham and Gloucester v Krauz with regards to s91(2) LPA 1925?
It should only be used by a court in exceptional circumstances. If a mortgagee also wanted a sale they should be allowed to control it to prevent the mortgagor asking too high a price to put off the sale.
What was also said in Krauz about when a mortgagee sought possession under s36 but the mortgagors made an application under s91 to sell themselves?
If the mortgagor wanted to defer possession to sell property himself where it was in negative equity he had to show he had private means to clear the shortfall otherwise s36 could not be used.
What does it mean to say a property is in negative equity?
The market value of the property is less than the mortgage debt.
J wants to sell his house worth £150,000. There is a legal charge over the property in favour of Glass Bank securing a debt of £200,000. M has offered to buy the house but J has no means of payi off the £50,000 that would remain owing. M is not willing to take over this debt. Would J need the consent of the bank to sell?
Yes, as the bank has no obligation to remove the legal charge if it is not cleared.
J is up to date with his mortgage repayments and has offered to repay the outstanding £50,000 after the sale. GBank won’t agree to remove the legal charge. Do the courts have jurisdiction to require GBank to remove the charge from the property if the sale went ahead?
Yes (s91 LPA 1925 allows them to do this; Palk).
Which of the following correctly describes the situation that arose in the case of Palk?
- both the mortgagee and the mortgagor wanted to sell the property
- only the mortgagor wanted to sell the property
Only the mortgagor wanted to sell the property.
In Palk the property was in negative equity and the mortgagee suggested the property should be rented out until the market improved. True or false?
True.
In Palk, the court used its powers under s91 LPA 1925 to order a sale of the property against the wishes of the mortgagee. It said that it needed to do so to avoid manifest unfairness. What did they mean by that?
The mortgagee’s proposal to rent the property would have resulted in the debt significantly growing each year with no certainty when the market would improve and return the property to positive equity.
What is the situation that arose in Barrett v Halifax?
Both the mortgagor and the mortgagee wanted to sell.
In the case of Barrett was the mortgagor in arrears with their mortgage repayments?
Yes.
In the case of Barrett, if the mortgagee and mortgagor both agreed about a sale going ahead why did the mortgagee object to the Barrtt’s selling the property?
It wanted to control the sale given it’s power of sale had arisen as a result of the Barrett’s mortgage arrears.
In the case of Barrett why did the court order a sale under s91 LPA 1925 against the wishes of the mortgagee?
Because an unoccupied property will get a better sale price than a repossessed property.
What is the meaning of the word reasonable period for paying off mortgage arrears?
The whole remaining length of the mortgage term but they must take these into consideration:
- ability of mortgagor to make the payments now and in the future
- likely duration of any temporary financial difficulty
- reason for the arrears
- period remaining of the original mortgage
- value of property measured against the amount owing
What is likely intended to mean with regards to repayment of arrears?
There must be a realistic chance, this must be supported by firm evidence of a detailed budget.
When the mortgagor wants to sell the property himself, what is meant by any sums due?
Repayment of the whole mortgage debt.
What is the meaning of the word likely in terms of selling the house himself?
Mortgagor has to show evidence in support of a sale occurring which will clear the debt.
What is a reasonable period in terms of the owner selling the house himself?
In National & Provincial Building Society v Lloyd it was indicated this could mean up to 1 year but no more. Bristol & West v Ellis said although 1 year was the maximum there was no fixed rule.
If J decided he wanted to ask the court to postpone possession to enable him to sell his property, what is the maximum period of time he is likely to be given to achieve the sale?
6 - 12 months (Bristol & West v Ellis).
In the case of Birmingham Building Society v Caunt, it was recognised that the court had an inherent power to postpone possession. However the court suggested that it could do so only for a very short period of around 28 days. Would a mortgagor ever apply to court under this jurisdiction rather than under the more generous jurisdiction of s36 AJA 1970?
Yes, it would be used by those whom s36 AJA 1970 was not available (communal mortgagor or residential mortgagor whose property has been peaceably repossessed).
Can the court order a sale notwithstanding the lender will be left out of pocket?
S91 LPA 1925 does give a court power to order a sale against the wishes of the mortgagee.
What point did the judge make in the case of Cheltenham and Gloucester v Krauz with regards to s91(2) LPA 1925?
It should only be used by a court in exceptional circumstances. If a mortgagee also wanted a sale they should be allowed to control it to prevent the mortgagor asking too high a price to put off the sale.
What was also said in Krauz about when a mortgagee sought possession under s36 but the mortgagors made an application under s91 to sell themselves?
If the mortgagor wanted to defer possession to sell property himself where it was in negative equity he had to show he had private means to clear the shortfall otherwise s36 could not be used.
What does it mean to say a property is in negative equity?
The market value of the property is less than the mortgage debt.
J wants to sell his house worth £150,000. There is a legal charge over the property in favour of Glass Bank securing a debt of £200,000. M has offered to buy the house but J has no means of payi off the £50,000 that would remain owing. M is not willing to take over this debt. Would J need the consent of the bank to sell?
Yes, as the bank has no obligation to remove the legal charge if it is not cleared.
J is up to date with his mortgage repayments and has offered to repay the outstanding £50,000 after the sale. GBank won’t agree to remove the legal charge. Do the courts have jurisdiction to require GBank to remove the charge from the property if the sale went ahead?
Yes (s91 LPA 1925 allows them to do this; Palk).
Which of the following correctly describes the situation that arose in the case of Palk?
- both the mortgagee and the mortgagor wanted to sell the property
- only the mortgagor wanted to sell the property
Only the mortgagor wanted to sell the property.
In Palk the property was in negative equity and the mortgagee suggested the property should be rented out until the market improved. True or false?
True.
In Palk, the court used its powers under s91 LPA 1925 to order a sale of the property against the wishes of the mortgagee. It said that it needed to do so to avoid manifest unfairness. What did they mean by that?
The mortgagee’s proposal to rent the property would have resulted in the debt significantly growing each year with no certainty when the market would improve and return the property to positive equity.
What is the situation that arose in Barrett v Halifax?
Both the mortgagor and the mortgagee wanted to sell.
In the case of Barrett was the mortgagor in arrears with their mortgage repayments?
Yes.
In the case of Barrett, if the mortgagee and mortgagor both agreed about a sale going ahead why did the mortgagee object to the Barrtt’s selling the property?
It wanted to control the sale given it’s power of sale had arisen as a result of the Barrett’s mortgage arrears.
In the case of Barrett why did the court order a sale under s91 LPA 1925 against the wishes of the mortgagee?
Because an unoccupied property will get a better sale price than a repossessed property.
What is the meaning of the word reasonable period for paying off mortgage arrears?
The whole remaining length of the mortgage term but they must take these into consideration:
- ability of mortgagor to make the payments now and in the future
- likely duration of any temporary financial difficulty
- reason for the arrears
- period remaining of the original mortgage
- value of property measured against the amount owing
What is likely intended to mean with regards to repayment of arrears?
There must be a realistic chance, this must be supported by firm evidence of a detailed budget.
When the mortgagor wants to sell the property himself, what is meant by any sums due?
Repayment of the whole mortgage debt.
What is the meaning of the word likely in terms of selling the house himself?
Mortgagor has to show evidence in support of a sale occurring which will clear the debt.
What is a reasonable period in terms of the owner selling the house himself?
In National & Provincial Building Society v Lloyd it was indicated this could mean up to 1 year but no more. Bristol & West v Ellis said although 1 year was the maximum there was no fixed rule.
If J decided he wanted to ask the court to postpone possession to enable him to sell his property, what is the maximum period of time he is likely to be given to achieve the sale?
6 - 12 months (Bristol & West v Ellis).
In the case of Birmingham Building Society v Caunt, it was recognised that the court had an inherent power to postpone possession. However the court suggested that it could do so only for a very short period of around 28 days. Would a mortgagor ever apply to court under this jurisdiction rather than under the more generous jurisdiction of s36 AJA 1970?
Yes, it would be used by those whom s36 AJA 1970 was not available (communal mortgagor or residential mortgagor whose property has been peaceably repossessed).
Can the court order a sale notwithstanding the lender will be left out of pocket?
S91 LPA 1925 does give a court power to order a sale against the wishes of the mortgagee.
What point did the judge make in the case of Cheltenham and Gloucester v Krauz with regards to s91(2) LPA 1925?
It should only be used by a court in exceptional circumstances. If a mortgagee also wanted a sale they should be allowed to control it to prevent the mortgagor asking too high a price to put off the sale.
What was also said in Krauz about when a mortgagee sought possession under s36 but the mortgagors made an application under s91 to sell themselves?
If the mortgagor wanted to defer possession to sell property himself where it was in negative equity he had to show he had private means to clear the shortfall otherwise s36 could not be used.
What does it mean to say a property is in negative equity?
The market value of the property is less than the mortgage debt.
J wants to sell his house worth £150,000. There is a legal charge over the property in favour of Glass Bank securing a debt of £200,000. M has offered to buy the house but J has no means of payi off the £50,000 that would remain owing. M is not willing to take over this debt. Would J need the consent of the bank to sell?
Yes, as the bank has no obligation to remove the legal charge if it is not cleared.
J is up to date with his mortgage repayments and has offered to repay the outstanding £50,000 after the sale. GBank won’t agree to remove the legal charge. Do the courts have jurisdiction to require GBank to remove the charge from the property if the sale went ahead?
Yes (s91 LPA 1925 allows them to do this; Palk).
Which of the following correctly describes the situation that arose in the case of Palk?
- both the mortgagee and the mortgagor wanted to sell the property
- only the mortgagor wanted to sell the property
Only the mortgagor wanted to sell the property.
In Palk the property was in negative equity and the mortgagee suggested the property should be rented out until the market improved. True or false?
True.
In Palk, the court used its powers under s91 LPA 1925 to order a sale of the property against the wishes of the mortgagee. It said that it needed to do so to avoid manifest unfairness. What did they mean by that?
The mortgagee’s proposal to rent the property would have resulted in the debt significantly growing each year with no certainty when the market would improve and return the property to positive equity.
What is the situation that arose in Barrett v Halifax?
Both the mortgagor and the mortgagee wanted to sell.
In the case of Barrett was the mortgagor in arrears with their mortgage repayments?
Yes.
In the case of Barrett, if the mortgagee and mortgagor both agreed about a sale going ahead why did the mortgagee object to the Barrtt’s selling the property?
It wanted to control the sale given it’s power of sale had arisen as a result of the Barrett’s mortgage arrears.
In the case of Barrett why did the court order a sale under s91 LPA 1925 against the wishes of the mortgagee?
Because an unoccupied property will get a better sale price than a repossessed property.
What is the meaning of the word reasonable period for paying off mortgage arrears?
The whole remaining length of the mortgage term but they must take these into consideration:
- ability of mortgagor to make the payments now and in the future
- likely duration of any temporary financial difficulty
- reason for the arrears
- period remaining of the original mortgage
- value of property measured against the amount owing
What is likely intended to mean with regards to repayment of arrears?
There must be a realistic chance, this must be supported by firm evidence of a detailed budget.
When the mortgagor wants to sell the property himself, what is meant by any sums due?
Repayment of the whole mortgage debt.
What is the meaning of the word likely in terms of selling the house himself?
Mortgagor has to show evidence in support of a sale occurring which will clear the debt.
What is a reasonable period in terms of the owner selling the house himself?
In National & Provincial Building Society v Lloyd it was indicated this could mean up to 1 year but no more. Bristol & West v Ellis said although 1 year was the maximum there was no fixed rule.
If J decided he wanted to ask the court to postpone possession to enable him to sell his property, what is the maximum period of time he is likely to be given to achieve the sale?
6 - 12 months (Bristol & West v Ellis).
In the case of Birmingham Building Society v Caunt, it was recognised that the court had an inherent power to postpone possession. However the court suggested that it could do so only for a very short period of around 28 days. Would a mortgagor ever apply to court under this jurisdiction rather than under the more generous jurisdiction of s36 AJA 1970?
Yes, it would be used by those whom s36 AJA 1970 was not available (communal mortgagor or residential mortgagor whose property has been peaceably repossessed).
Can the court order a sale notwithstanding the lender will be left out of pocket?
S91 LPA 1925 does give a court power to order a sale against the wishes of the mortgagee.
What point did the judge make in the case of Cheltenham and Gloucester v Krauz with regards to s91(2) LPA 1925?
It should only be used by a court in exceptional circumstances. If a mortgagee also wanted a sale they should be allowed to control it to prevent the mortgagor asking too high a price to put off the sale.
What was also said in Krauz about when a mortgagee sought possession under s36 but the mortgagors made an application under s91 to sell themselves?
If the mortgagor wanted to defer possession to sell property himself where it was in negative equity he had to show he had private means to clear the shortfall otherwise s36 could not be used.
What does it mean to say a property is in negative equity?
The market value of the property is less than the mortgage debt.
J wants to sell his house worth £150,000. There is a legal charge over the property in favour of Glass Bank securing a debt of £200,000. M has offered to buy the house but J has no means of payi off the £50,000 that would remain owing. M is not willing to take over this debt. Would J need the consent of the bank to sell?
Yes, as the bank has no obligation to remove the legal charge if it is not cleared.
J is up to date with his mortgage repayments and has offered to repay the outstanding £50,000 after the sale. GBank won’t agree to remove the legal charge. Do the courts have jurisdiction to require GBank to remove the charge from the property if the sale went ahead?
Yes (s91 LPA 1925 allows them to do this; Palk).
Which of the following correctly describes the situation that arose in the case of Palk?
- both the mortgagee and the mortgagor wanted to sell the property
- only the mortgagor wanted to sell the property
Only the mortgagor wanted to sell the property.
In Palk the property was in negative equity and the mortgagee suggested the property should be rented out until the market improved. True or false?
True.
In Palk, the court used its powers under s91 LPA 1925 to order a sale of the property against the wishes of the mortgagee. It said that it needed to do so to avoid manifest unfairness. What did they mean by that?
The mortgagee’s proposal to rent the property would have resulted in the debt significantly growing each year with no certainty when the market would improve and return the property to positive equity.
What is the situation that arose in Barrett v Halifax?
Both the mortgagor and the mortgagee wanted to sell.
In the case of Barrett was the mortgagor in arrears with their mortgage repayments?
Yes.
In the case of Barrett, if the mortgagee and mortgagor both agreed about a sale going ahead why did the mortgagee object to the Barrtt’s selling the property?
It wanted to control the sale given it’s power of sale had arisen as a result of the Barrett’s mortgage arrears.
In the case of Barrett why did the court order a sale under s91 LPA 1925 against the wishes of the mortgagee?
Because an unoccupied property will get a better sale price than a repossessed property.
What is the meaning of the word reasonable period for paying off mortgage arrears?
The whole remaining length of the mortgage term but they must take these into consideration:
- ability of mortgagor to make the payments now and in the future
- likely duration of any temporary financial difficulty
- reason for the arrears
- period remaining of the original mortgage
- value of property measured against the amount owing
What is likely intended to mean with regards to repayment of arrears?
There must be a realistic chance, this must be supported by firm evidence of a detailed budget.
When the mortgagor wants to sell the property himself, what is meant by any sums due?
Repayment of the whole mortgage debt.
What is the meaning of the word likely in terms of selling the house himself?
Mortgagor has to show evidence in support of a sale occurring which will clear the debt.
What is a reasonable period in terms of the owner selling the house himself?
In National & Provincial Building Society v Lloyd it was indicated this could mean up to 1 year but no more. Bristol & West v Ellis said although 1 year was the maximum there was no fixed rule.
If J decided he wanted to ask the court to postpone possession to enable him to sell his property, what is the maximum period of time he is likely to be given to achieve the sale?
6 - 12 months (Bristol & West v Ellis).
In the case of Birmingham Building Society v Caunt, it was recognised that the court had an inherent power to postpone possession. However the court suggested that it could do so only for a very short period of around 28 days. Would a mortgagor ever apply to court under this jurisdiction rather than under the more generous jurisdiction of s36 AJA 1970?
Yes, it would be used by those whom s36 AJA 1970 was not available (communal mortgagor or residential mortgagor whose property has been peaceably repossessed).
Can the court order a sale notwithstanding the lender will be left out of pocket?
S91 LPA 1925 does give a court power to order a sale against the wishes of the mortgagee.
What point did the judge make in the case of Cheltenham and Gloucester v Krauz with regards to s91(2) LPA 1925?
It should only be used by a court in exceptional circumstances. If a mortgagee also wanted a sale they should be allowed to control it to prevent the mortgagor asking too high a price to put off the sale.
What was also said in Krauz about when a mortgagee sought possession under s36 but the mortgagors made an application under s91 to sell themselves?
If the mortgagor wanted to defer possession to sell property himself where it was in negative equity he had to show he had private means to clear the shortfall otherwise s36 could not be used.
What does it mean to say a property is in negative equity?
The market value of the property is less than the mortgage debt.
J wants to sell his house worth £150,000. There is a legal charge over the property in favour of Glass Bank securing a debt of £200,000. M has offered to buy the house but J has no means of payi off the £50,000 that would remain owing. M is not willing to take over this debt. Would J need the consent of the bank to sell?
Yes, as the bank has no obligation to remove the legal charge if it is not cleared.
J is up to date with his mortgage repayments and has offered to repay the outstanding £50,000 after the sale. GBank won’t agree to remove the legal charge. Do the courts have jurisdiction to require GBank to remove the charge from the property if the sale went ahead?
Yes (s91 LPA 1925 allows them to do this; Palk).
Which of the following correctly describes the situation that arose in the case of Palk?
- both the mortgagee and the mortgagor wanted to sell the property
- only the mortgagor wanted to sell the property
Only the mortgagor wanted to sell the property.
In Palk the property was in negative equity and the mortgagee suggested the property should be rented out until the market improved. True or false?
True.
In Palk, the court used its powers under s91 LPA 1925 to order a sale of the property against the wishes of the mortgagee. It said that it needed to do so to avoid manifest unfairness. What did they mean by that?
The mortgagee’s proposal to rent the property would have resulted in the debt significantly growing each year with no certainty when the market would improve and return the property to positive equity.
What is the situation that arose in Barrett v Halifax?
Both the mortgagor and the mortgagee wanted to sell.
In the case of Barrett was the mortgagor in arrears with their mortgage repayments?
Yes.
In the case of Barrett, if the mortgagee and mortgagor both agreed about a sale going ahead why did the mortgagee object to the Barrtt’s selling the property?
It wanted to control the sale given it’s power of sale had arisen as a result of the Barrett’s mortgage arrears.
In the case of Barrett why did the court order a sale under s91 LPA 1925 against the wishes of the mortgagee?
Because an unoccupied property will get a better sale price than a repossessed property.
What is the meaning of the word reasonable period for paying off mortgage arrears?
The whole remaining length of the mortgage term but they must take these into consideration:
- ability of mortgagor to make the payments now and in the future
- likely duration of any temporary financial difficulty
- reason for the arrears
- period remaining of the original mortgage
- value of property measured against the amount owing
What is likely intended to mean with regards to repayment of arrears?
There must be a realistic chance, this must be supported by firm evidence of a detailed budget.
When the mortgagor wants to sell the property himself, what is meant by any sums due?
Repayment of the whole mortgage debt.
What is the meaning of the word likely in terms of selling the house himself?
Mortgagor has to show evidence in support of a sale occurring which will clear the debt.
What is a reasonable period in terms of the owner selling the house himself?
In National & Provincial Building Society v Lloyd it was indicated this could mean up to 1 year but no more. Bristol & West v Ellis said although 1 year was the maximum there was no fixed rule.
If J decided he wanted to ask the court to postpone possession to enable him to sell his property, what is the maximum period of time he is likely to be given to achieve the sale?
6 - 12 months (Bristol & West v Ellis).
In the case of Birmingham Building Society v Caunt, it was recognised that the court had an inherent power to postpone possession. However the court suggested that it could do so only for a very short period of around 28 days. Would a mortgagor ever apply to court under this jurisdiction rather than under the more generous jurisdiction of s36 AJA 1970?
Yes, it would be used by those whom s36 AJA 1970 was not available (communal mortgagor or residential mortgagor whose property has been peaceably repossessed).
Can the court order a sale notwithstanding the lender will be left out of pocket?
S91 LPA 1925 does give a court power to order a sale against the wishes of the mortgagee.
What point did the judge make in the case of Cheltenham and Gloucester v Krauz with regards to s91(2) LPA 1925?
It should only be used by a court in exceptional circumstances. If a mortgagee also wanted a sale they should be allowed to control it to prevent the mortgagor asking too high a price to put off the sale.
What was also said in Krauz about when a mortgagee sought possession under s36 but the mortgagors made an application under s91 to sell themselves?
If the mortgagor wanted to defer possession to sell property himself where it was in negative equity he had to show he had private means to clear the shortfall otherwise s36 could not be used.
What does it mean to say a property is in negative equity?
The market value of the property is less than the mortgage debt.
J wants to sell his house worth £150,000. There is a legal charge over the property in favour of Glass Bank securing a debt of £200,000. M has offered to buy the house but J has no means of payi off the £50,000 that would remain owing. M is not willing to take over this debt. Would J need the consent of the bank to sell?
Yes, as the bank has no obligation to remove the legal charge if it is not cleared.
J is up to date with his mortgage repayments and has offered to repay the outstanding £50,000 after the sale. GBank won’t agree to remove the legal charge. Do the courts have jurisdiction to require GBank to remove the charge from the property if the sale went ahead?
Yes (s91 LPA 1925 allows them to do this; Palk).
Which of the following correctly describes the situation that arose in the case of Palk?
- both the mortgagee and the mortgagor wanted to sell the property
- only the mortgagor wanted to sell the property
Only the mortgagor wanted to sell the property.
In Palk the property was in negative equity and the mortgagee suggested the property should be rented out until the market improved. True or false?
True.
In Palk, the court used its powers under s91 LPA 1925 to order a sale of the property against the wishes of the mortgagee. It said that it needed to do so to avoid manifest unfairness. What did they mean by that?
The mortgagee’s proposal to rent the property would have resulted in the debt significantly growing each year with no certainty when the market would improve and return the property to positive equity.
What is the situation that arose in Barrett v Halifax?
Both the mortgagor and the mortgagee wanted to sell.
In the case of Barrett was the mortgagor in arrears with their mortgage repayments?
Yes.
In the case of Barrett, if the mortgagee and mortgagor both agreed about a sale going ahead why did the mortgagee object to the Barrtt’s selling the property?
It wanted to control the sale given it’s power of sale had arisen as a result of the Barrett’s mortgage arrears.
In the case of Barrett why did the court order a sale under s91 LPA 1925 against the wishes of the mortgagee?
Because an unoccupied property will get a better sale price than a repossessed property.
What is the meaning of the word reasonable period for paying off mortgage arrears?
The whole remaining length of the mortgage term but they must take these into consideration:
- ability of mortgagor to make the payments now and in the future
- likely duration of any temporary financial difficulty
- reason for the arrears
- period remaining of the original mortgage
- value of property measured against the amount owing
What is likely intended to mean with regards to repayment of arrears?
There must be a realistic chance, this must be supported by firm evidence of a detailed budget.
When the mortgagor wants to sell the property himself, what is meant by any sums due?
Repayment of the whole mortgage debt.
What is the meaning of the word likely in terms of selling the house himself?
Mortgagor has to show evidence in support of a sale occurring which will clear the debt.
What is a reasonable period in terms of the owner selling the house himself?
In National & Provincial Building Society v Lloyd it was indicated this could mean up to 1 year but no more. Bristol & West v Ellis said although 1 year was the maximum there was no fixed rule.
If J decided he wanted to ask the court to postpone possession to enable him to sell his property, what is the maximum period of time he is likely to be given to achieve the sale?
6 - 12 months (Bristol & West v Ellis).
In the case of Birmingham Building Society v Caunt, it was recognised that the court had an inherent power to postpone possession. However the court suggested that it could do so only for a very short period of around 28 days. Would a mortgagor ever apply to court under this jurisdiction rather than under the more generous jurisdiction of s36 AJA 1970?
Yes, it would be used by those whom s36 AJA 1970 was not available (communal mortgagor or residential mortgagor whose property has been peaceably repossessed).
Can the court order a sale notwithstanding the lender will be left out of pocket?
S91 LPA 1925 does give a court power to order a sale against the wishes of the mortgagee.
What point did the judge make in the case of Cheltenham and Gloucester v Krauz with regards to s91(2) LPA 1925?
It should only be used by a court in exceptional circumstances. If a mortgagee also wanted a sale they should be allowed to control it to prevent the mortgagor asking too high a price to put off the sale.
What was also said in Krauz about when a mortgagee sought possession under s36 but the mortgagors made an application under s91 to sell themselves?
If the mortgagor wanted to defer possession to sell property himself where it was in negative equity he had to show he had private means to clear the shortfall otherwise s36 could not be used.
What does it mean to say a property is in negative equity?
The market value of the property is less than the mortgage debt.
J wants to sell his house worth £150,000. There is a legal charge over the property in favour of Glass Bank securing a debt of £200,000. M has offered to buy the house but J has no means of payi off the £50,000 that would remain owing. M is not willing to take over this debt. Would J need the consent of the bank to sell?
Yes, as the bank has no obligation to remove the legal charge if it is not cleared.
J is up to date with his mortgage repayments and has offered to repay the outstanding £50,000 after the sale. GBank won’t agree to remove the legal charge. Do the courts have jurisdiction to require GBank to remove the charge from the property if the sale went ahead?
Yes (s91 LPA 1925 allows them to do this; Palk).
Which of the following correctly describes the situation that arose in the case of Palk?
- both the mortgagee and the mortgagor wanted to sell the property
- only the mortgagor wanted to sell the property
Only the mortgagor wanted to sell the property.
In Palk the property was in negative equity and the mortgagee suggested the property should be rented out until the market improved. True or false?
True.
In Palk, the court used its powers under s91 LPA 1925 to order a sale of the property against the wishes of the mortgagee. It said that it needed to do so to avoid manifest unfairness. What did they mean by that?
The mortgagee’s proposal to rent the property would have resulted in the debt significantly growing each year with no certainty when the market would improve and return the property to positive equity.
What is the situation that arose in Barrett v Halifax?
Both the mortgagor and the mortgagee wanted to sell.
In the case of Barrett was the mortgagor in arrears with their mortgage repayments?
Yes.
In the case of Barrett, if the mortgagee and mortgagor both agreed about a sale going ahead why did the mortgagee object to the Barrtt’s selling the property?
It wanted to control the sale given it’s power of sale had arisen as a result of the Barrett’s mortgage arrears.
In the case of Barrett why did the court order a sale under s91 LPA 1925 against the wishes of the mortgagee?
Because an unoccupied property will get a better sale price than a repossessed property.
What is the meaning of the word reasonable period for paying off mortgage arrears?
The whole remaining length of the mortgage term but they must take these into consideration:
- ability of mortgagor to make the payments now and in the future
- likely duration of any temporary financial difficulty
- reason for the arrears
- period remaining of the original mortgage
- value of property measured against the amount owing
What is likely intended to mean with regards to repayment of arrears?
There must be a realistic chance, this must be supported by firm evidence of a detailed budget.
When the mortgagor wants to sell the property himself, what is meant by any sums due?
Repayment of the whole mortgage debt.
What is the meaning of the word likely in terms of selling the house himself?
Mortgagor has to show evidence in support of a sale occurring which will clear the debt.
What is a reasonable period in terms of the owner selling the house himself?
In National & Provincial Building Society v Lloyd it was indicated this could mean up to 1 year but no more. Bristol & West v Ellis said although 1 year was the maximum there was no fixed rule.
If J decided he wanted to ask the court to postpone possession to enable him to sell his property, what is the maximum period of time he is likely to be given to achieve the sale?
6 - 12 months (Bristol & West v Ellis).
In the case of Birmingham Building Society v Caunt, it was recognised that the court had an inherent power to postpone possession. However the court suggested that it could do so only for a very short period of around 28 days. Would a mortgagor ever apply to court under this jurisdiction rather than under the more generous jurisdiction of s36 AJA 1970?
Yes, it would be used by those whom s36 AJA 1970 was not available (communal mortgagor or residential mortgagor whose property has been peaceably repossessed).
Can the court order a sale notwithstanding the lender will be left out of pocket?
S91 LPA 1925 does give a court power to order a sale against the wishes of the mortgagee.
What point did the judge make in the case of Cheltenham and Gloucester v Krauz with regards to s91(2) LPA 1925?
It should only be used by a court in exceptional circumstances. If a mortgagee also wanted a sale they should be allowed to control it to prevent the mortgagor asking too high a price to put off the sale.
What was also said in Krauz about when a mortgagee sought possession under s36 but the mortgagors made an application under s91 to sell themselves?
If the mortgagor wanted to defer possession to sell property himself where it was in negative equity he had to show he had private means to clear the shortfall otherwise s36 could not be used.
What does it mean to say a property is in negative equity?
The market value of the property is less than the mortgage debt.
J wants to sell his house worth £150,000. There is a legal charge over the property in favour of Glass Bank securing a debt of £200,000. M has offered to buy the house but J has no means of payi off the £50,000 that would remain owing. M is not willing to take over this debt. Would J need the consent of the bank to sell?
Yes, as the bank has no obligation to remove the legal charge if it is not cleared.
J is up to date with his mortgage repayments and has offered to repay the outstanding £50,000 after the sale. GBank won’t agree to remove the legal charge. Do the courts have jurisdiction to require GBank to remove the charge from the property if the sale went ahead?
Yes (s91 LPA 1925 allows them to do this; Palk).
Which of the following correctly describes the situation that arose in the case of Palk?
- both the mortgagee and the mortgagor wanted to sell the property
- only the mortgagor wanted to sell the property
Only the mortgagor wanted to sell the property.
In Palk the property was in negative equity and the mortgagee suggested the property should be rented out until the market improved. True or false?
True.
In Palk, the court used its powers under s91 LPA 1925 to order a sale of the property against the wishes of the mortgagee. It said that it needed to do so to avoid manifest unfairness. What did they mean by that?
The mortgagee’s proposal to rent the property would have resulted in the debt significantly growing each year with no certainty when the market would improve and return the property to positive equity.
What is the situation that arose in Barrett v Halifax?
Both the mortgagor and the mortgagee wanted to sell.
In the case of Barrett was the mortgagor in arrears with their mortgage repayments?
Yes.
In the case of Barrett, if the mortgagee and mortgagor both agreed about a sale going ahead why did the mortgagee object to the Barrtt’s selling the property?
It wanted to control the sale given it’s power of sale had arisen as a result of the Barrett’s mortgage arrears.
In the case of Barrett why did the court order a sale under s91 LPA 1925 against the wishes of the mortgagee?
Because an unoccupied property will get a better sale price than a repossessed property.
What is the meaning of the word reasonable period for paying off mortgage arrears?
The whole remaining length of the mortgage term but they must take these into consideration:
- ability of mortgagor to make the payments now and in the future
- likely duration of any temporary financial difficulty
- reason for the arrears
- period remaining of the original mortgage
- value of property measured against the amount owing
What is likely intended to mean with regards to repayment of arrears?
There must be a realistic chance, this must be supported by firm evidence of a detailed budget.
When the mortgagor wants to sell the property himself, what is meant by any sums due?
Repayment of the whole mortgage debt.
What is the meaning of the word likely in terms of selling the house himself?
Mortgagor has to show evidence in support of a sale occurring which will clear the debt.
What is a reasonable period in terms of the owner selling the house himself?
In National & Provincial Building Society v Lloyd it was indicated this could mean up to 1 year but no more. Bristol & West v Ellis said although 1 year was the maximum there was no fixed rule.
If J decided he wanted to ask the court to postpone possession to enable him to sell his property, what is the maximum period of time he is likely to be given to achieve the sale?
6 - 12 months (Bristol & West v Ellis).
In the case of Birmingham Building Society v Caunt, it was recognised that the court had an inherent power to postpone possession. However the court suggested that it could do so only for a very short period of around 28 days. Would a mortgagor ever apply to court under this jurisdiction rather than under the more generous jurisdiction of s36 AJA 1970?
Yes, it would be used by those whom s36 AJA 1970 was not available (communal mortgagor or residential mortgagor whose property has been peaceably repossessed).
Can the court order a sale notwithstanding the lender will be left out of pocket?
S91 LPA 1925 does give a court power to order a sale against the wishes of the mortgagee.
What point did the judge make in the case of Cheltenham and Gloucester v Krauz with regards to s91(2) LPA 1925?
It should only be used by a court in exceptional circumstances. If a mortgagee also wanted a sale they should be allowed to control it to prevent the mortgagor asking too high a price to put off the sale.
What was also said in Krauz about when a mortgagee sought possession under s36 but the mortgagors made an application under s91 to sell themselves?
If the mortgagor wanted to defer possession to sell property himself where it was in negative equity he had to show he had private means to clear the shortfall otherwise s36 could not be used.
What does it mean to say a property is in negative equity?
The market value of the property is less than the mortgage debt.
J wants to sell his house worth £150,000. There is a legal charge over the property in favour of Glass Bank securing a debt of £200,000. M has offered to buy the house but J has no means of payi off the £50,000 that would remain owing. M is not willing to take over this debt. Would J need the consent of the bank to sell?
Yes, as the bank has no obligation to remove the legal charge if it is not cleared.
J is up to date with his mortgage repayments and has offered to repay the outstanding £50,000 after the sale. GBank won’t agree to remove the legal charge. Do the courts have jurisdiction to require GBank to remove the charge from the property if the sale went ahead?
Yes (s91 LPA 1925 allows them to do this; Palk).
Which of the following correctly describes the situation that arose in the case of Palk?
- both the mortgagee and the mortgagor wanted to sell the property
- only the mortgagor wanted to sell the property
Only the mortgagor wanted to sell the property.
In Palk the property was in negative equity and the mortgagee suggested the property should be rented out until the market improved. True or false?
True.
In Palk, the court used its powers under s91 LPA 1925 to order a sale of the property against the wishes of the mortgagee. It said that it needed to do so to avoid manifest unfairness. What did they mean by that?
The mortgagee’s proposal to rent the property would have resulted in the debt significantly growing each year with no certainty when the market would improve and return the property to positive equity.
What is the situation that arose in Barrett v Halifax?
Both the mortgagor and the mortgagee wanted to sell.
In the case of Barrett was the mortgagor in arrears with their mortgage repayments?
Yes.
In the case of Barrett, if the mortgagee and mortgagor both agreed about a sale going ahead why did the mortgagee object to the Barrtt’s selling the property?
It wanted to control the sale given it’s power of sale had arisen as a result of the Barrett’s mortgage arrears.
In the case of Barrett why did the court order a sale under s91 LPA 1925 against the wishes of the mortgagee?
Because an unoccupied property will get a better sale price than a repossessed property.
What is the meaning of the word reasonable period for paying off mortgage arrears?
The whole remaining length of the mortgage term but they must take these into consideration:
- ability of mortgagor to make the payments now and in the future
- likely duration of any temporary financial difficulty
- reason for the arrears
- period remaining of the original mortgage
- value of property measured against the amount owing
What is likely intended to mean with regards to repayment of arrears?
There must be a realistic chance, this must be supported by firm evidence of a detailed budget.
When the mortgagor wants to sell the property himself, what is meant by any sums due?
Repayment of the whole mortgage debt.
What is the meaning of the word likely in terms of selling the house himself?
Mortgagor has to show evidence in support of a sale occurring which will clear the debt.
What is a reasonable period in terms of the owner selling the house himself?
In National & Provincial Building Society v Lloyd it was indicated this could mean up to 1 year but no more. Bristol & West v Ellis said although 1 year was the maximum there was no fixed rule.
If J decided he wanted to ask the court to postpone possession to enable him to sell his property, what is the maximum period of time he is likely to be given to achieve the sale?
6 - 12 months (Bristol & West v Ellis).
In the case of Birmingham Building Society v Caunt, it was recognised that the court had an inherent power to postpone possession. However the court suggested that it could do so only for a very short period of around 28 days. Would a mortgagor ever apply to court under this jurisdiction rather than under the more generous jurisdiction of s36 AJA 1970?
Yes, it would be used by those whom s36 AJA 1970 was not available (communal mortgagor or residential mortgagor whose property has been peaceably repossessed).
Can the court order a sale notwithstanding the lender will be left out of pocket?
S91 LPA 1925 does give a court power to order a sale against the wishes of the mortgagee.
What point did the judge make in the case of Cheltenham and Gloucester v Krauz with regards to s91(2) LPA 1925?
It should only be used by a court in exceptional circumstances. If a mortgagee also wanted a sale they should be allowed to control it to prevent the mortgagor asking too high a price to put off the sale.
What was also said in Krauz about when a mortgagee sought possession under s36 but the mortgagors made an application under s91 to sell themselves?
If the mortgagor wanted to defer possession to sell property himself where it was in negative equity he had to show he had private means to clear the shortfall otherwise s36 could not be used.
What does it mean to say a property is in negative equity?
The market value of the property is less than the mortgage debt.
J wants to sell his house worth £150,000. There is a legal charge over the property in favour of Glass Bank securing a debt of £200,000. M has offered to buy the house but J has no means of payi off the £50,000 that would remain owing. M is not willing to take over this debt. Would J need the consent of the bank to sell?
Yes, as the bank has no obligation to remove the legal charge if it is not cleared.
J is up to date with his mortgage repayments and has offered to repay the outstanding £50,000 after the sale. GBank won’t agree to remove the legal charge. Do the courts have jurisdiction to require GBank to remove the charge from the property if the sale went ahead?
Yes (s91 LPA 1925 allows them to do this; Palk).
Which of the following correctly describes the situation that arose in the case of Palk?
- both the mortgagee and the mortgagor wanted to sell the property
- only the mortgagor wanted to sell the property
Only the mortgagor wanted to sell the property.
In Palk the property was in negative equity and the mortgagee suggested the property should be rented out until the market improved. True or false?
True.
In Palk, the court used its powers under s91 LPA 1925 to order a sale of the property against the wishes of the mortgagee. It said that it needed to do so to avoid manifest unfairness. What did they mean by that?
The mortgagee’s proposal to rent the property would have resulted in the debt significantly growing each year with no certainty when the market would improve and return the property to positive equity.
What is the situation that arose in Barrett v Halifax?
Both the mortgagor and the mortgagee wanted to sell.
In the case of Barrett was the mortgagor in arrears with their mortgage repayments?
Yes.
In the case of Barrett, if the mortgagee and mortgagor both agreed about a sale going ahead why did the mortgagee object to the Barrtt’s selling the property?
It wanted to control the sale given it’s power of sale had arisen as a result of the Barrett’s mortgage arrears.
In the case of Barrett why did the court order a sale under s91 LPA 1925 against the wishes of the mortgagee?
Because an unoccupied property will get a better sale price than a repossessed property.
What is the meaning of the word reasonable period for paying off mortgage arrears?
The whole remaining length of the mortgage term but they must take these into consideration:
- ability of mortgagor to make the payments now and in the future
- likely duration of any temporary financial difficulty
- reason for the arrears
- period remaining of the original mortgage
- value of property measured against the amount owing
What is likely intended to mean with regards to repayment of arrears?
There must be a realistic chance, this must be supported by firm evidence of a detailed budget.
When the mortgagor wants to sell the property himself, what is meant by any sums due?
Repayment of the whole mortgage debt.
What is the meaning of the word likely in terms of selling the house himself?
Mortgagor has to show evidence in support of a sale occurring which will clear the debt.
What is a reasonable period in terms of the owner selling the house himself?
In National & Provincial Building Society v Lloyd it was indicated this could mean up to 1 year but no more. Bristol & West v Ellis said although 1 year was the maximum there was no fixed rule.
If J decided he wanted to ask the court to postpone possession to enable him to sell his property, what is the maximum period of time he is likely to be given to achieve the sale?
6 - 12 months (Bristol & West v Ellis).
In the case of Birmingham Building Society v Caunt, it was recognised that the court had an inherent power to postpone possession. However the court suggested that it could do so only for a very short period of around 28 days. Would a mortgagor ever apply to court under this jurisdiction rather than under the more generous jurisdiction of s36 AJA 1970?
Yes, it would be used by those whom s36 AJA 1970 was not available (communal mortgagor or residential mortgagor whose property has been peaceably repossessed).
Can the court order a sale notwithstanding the lender will be left out of pocket?
S91 LPA 1925 does give a court power to order a sale against the wishes of the mortgagee.
What point did the judge make in the case of Cheltenham and Gloucester v Krauz with regards to s91(2) LPA 1925?
It should only be used by a court in exceptional circumstances. If a mortgagee also wanted a sale they should be allowed to control it to prevent the mortgagor asking too high a price to put off the sale.
What was also said in Krauz about when a mortgagee sought possession under s36 but the mortgagors made an application under s91 to sell themselves?
If the mortgagor wanted to defer possession to sell property himself where it was in negative equity he had to show he had private means to clear the shortfall otherwise s36 could not be used.
What does it mean to say a property is in negative equity?
The market value of the property is less than the mortgage debt.
J wants to sell his house worth £150,000. There is a legal charge over the property in favour of Glass Bank securing a debt of £200,000. M has offered to buy the house but J has no means of payi off the £50,000 that would remain owing. M is not willing to take over this debt. Would J need the consent of the bank to sell?
Yes, as the bank has no obligation to remove the legal charge if it is not cleared.
J is up to date with his mortgage repayments and has offered to repay the outstanding £50,000 after the sale. GBank won’t agree to remove the legal charge. Do the courts have jurisdiction to require GBank to remove the charge from the property if the sale went ahead?
Yes (s91 LPA 1925 allows them to do this; Palk).
Which of the following correctly describes the situation that arose in the case of Palk?
- both the mortgagee and the mortgagor wanted to sell the property
- only the mortgagor wanted to sell the property
Only the mortgagor wanted to sell the property.
In Palk the property was in negative equity and the mortgagee suggested the property should be rented out until the market improved. True or false?
True.
In Palk, the court used its powers under s91 LPA 1925 to order a sale of the property against the wishes of the mortgagee. It said that it needed to do so to avoid manifest unfairness. What did they mean by that?
The mortgagee’s proposal to rent the property would have resulted in the debt significantly growing each year with no certainty when the market would improve and return the property to positive equity.
What is the situation that arose in Barrett v Halifax?
Both the mortgagor and the mortgagee wanted to sell.
In the case of Barrett was the mortgagor in arrears with their mortgage repayments?
Yes.
In the case of Barrett, if the mortgagee and mortgagor both agreed about a sale going ahead why did the mortgagee object to the Barrtt’s selling the property?
It wanted to control the sale given it’s power of sale had arisen as a result of the Barrett’s mortgage arrears.
In the case of Barrett why did the court order a sale under s91 LPA 1925 against the wishes of the mortgagee?
Because an unoccupied property will get a better sale price than a repossessed property.
What is the meaning of the word reasonable period for paying off mortgage arrears?
The whole remaining length of the mortgage term but they must take these into consideration:
- ability of mortgagor to make the payments now and in the future
- likely duration of any temporary financial difficulty
- reason for the arrears
- period remaining of the original mortgage
- value of property measured against the amount owing
What is likely intended to mean with regards to repayment of arrears?
There must be a realistic chance, this must be supported by firm evidence of a detailed budget.
When the mortgagor wants to sell the property himself, what is meant by any sums due?
Repayment of the whole mortgage debt.
What is the meaning of the word likely in terms of selling the house himself?
Mortgagor has to show evidence in support of a sale occurring which will clear the debt.
What is a reasonable period in terms of the owner selling the house himself?
In National & Provincial Building Society v Lloyd it was indicated this could mean up to 1 year but no more. Bristol & West v Ellis said although 1 year was the maximum there was no fixed rule.
If J decided he wanted to ask the court to postpone possession to enable him to sell his property, what is the maximum period of time he is likely to be given to achieve the sale?
6 - 12 months (Bristol & West v Ellis).
In the case of Birmingham Building Society v Caunt, it was recognised that the court had an inherent power to postpone possession. However the court suggested that it could do so only for a very short period of around 28 days. Would a mortgagor ever apply to court under this jurisdiction rather than under the more generous jurisdiction of s36 AJA 1970?
Yes, it would be used by those whom s36 AJA 1970 was not available (communal mortgagor or residential mortgagor whose property has been peaceably repossessed).
Can the court order a sale notwithstanding the lender will be left out of pocket?
S91 LPA 1925 does give a court power to order a sale against the wishes of the mortgagee.
What point did the judge make in the case of Cheltenham and Gloucester v Krauz with regards to s91(2) LPA 1925?
It should only be used by a court in exceptional circumstances. If a mortgagee also wanted a sale they should be allowed to control it to prevent the mortgagor asking too high a price to put off the sale.
What was also said in Krauz about when a mortgagee sought possession under s36 but the mortgagors made an application under s91 to sell themselves?
If the mortgagor wanted to defer possession to sell property himself where it was in negative equity he had to show he had private means to clear the shortfall otherwise s36 could not be used.
What does it mean to say a property is in negative equity?
The market value of the property is less than the mortgage debt.
J wants to sell his house worth £150,000. There is a legal charge over the property in favour of Glass Bank securing a debt of £200,000. M has offered to buy the house but J has no means of payi off the £50,000 that would remain owing. M is not willing to take over this debt. Would J need the consent of the bank to sell?
Yes, as the bank has no obligation to remove the legal charge if it is not cleared.
J is up to date with his mortgage repayments and has offered to repay the outstanding £50,000 after the sale. GBank won’t agree to remove the legal charge. Do the courts have jurisdiction to require GBank to remove the charge from the property if the sale went ahead?
Yes (s91 LPA 1925 allows them to do this; Palk).
Which of the following correctly describes the situation that arose in the case of Palk?
- both the mortgagee and the mortgagor wanted to sell the property
- only the mortgagor wanted to sell the property
Only the mortgagor wanted to sell the property.
In Palk the property was in negative equity and the mortgagee suggested the property should be rented out until the market improved. True or false?
True.
In Palk, the court used its powers under s91 LPA 1925 to order a sale of the property against the wishes of the mortgagee. It said that it needed to do so to avoid manifest unfairness. What did they mean by that?
The mortgagee’s proposal to rent the property would have resulted in the debt significantly growing each year with no certainty when the market would improve and return the property to positive equity.
What is the situation that arose in Barrett v Halifax?
Both the mortgagor and the mortgagee wanted to sell.
In the case of Barrett was the mortgagor in arrears with their mortgage repayments?
Yes.
In the case of Barrett, if the mortgagee and mortgagor both agreed about a sale going ahead why did the mortgagee object to the Barrtt’s selling the property?
It wanted to control the sale given it’s power of sale had arisen as a result of the Barrett’s mortgage arrears.
In the case of Barrett why did the court order a sale under s91 LPA 1925 against the wishes of the mortgagee?
Because an unoccupied property will get a better sale price than a repossessed property.
What is the meaning of the word reasonable period for paying off mortgage arrears?
The whole remaining length of the mortgage term but they must take these into consideration:
- ability of mortgagor to make the payments now and in the future
- likely duration of any temporary financial difficulty
- reason for the arrears
- period remaining of the original mortgage
- value of property measured against the amount owing
What is likely intended to mean with regards to repayment of arrears?
There must be a realistic chance, this must be supported by firm evidence of a detailed budget.
When the mortgagor wants to sell the property himself, what is meant by any sums due?
Repayment of the whole mortgage debt.
What is the meaning of the word likely in terms of selling the house himself?
Mortgagor has to show evidence in support of a sale occurring which will clear the debt.
What is a reasonable period in terms of the owner selling the house himself?
In National & Provincial Building Society v Lloyd it was indicated this could mean up to 1 year but no more. Bristol & West v Ellis said although 1 year was the maximum there was no fixed rule.
If J decided he wanted to ask the court to postpone possession to enable him to sell his property, what is the maximum period of time he is likely to be given to achieve the sale?
6 - 12 months (Bristol & West v Ellis).
In the case of Birmingham Building Society v Caunt, it was recognised that the court had an inherent power to postpone possession. However the court suggested that it could do so only for a very short period of around 28 days. Would a mortgagor ever apply to court under this jurisdiction rather than under the more generous jurisdiction of s36 AJA 1970?
Yes, it would be used by those whom s36 AJA 1970 was not available (communal mortgagor or residential mortgagor whose property has been peaceably repossessed).
Can the court order a sale notwithstanding the lender will be left out of pocket?
S91 LPA 1925 does give a court power to order a sale against the wishes of the mortgagee.
What point did the judge make in the case of Cheltenham and Gloucester v Krauz with regards to s91(2) LPA 1925?
It should only be used by a court in exceptional circumstances. If a mortgagee also wanted a sale they should be allowed to control it to prevent the mortgagor asking too high a price to put off the sale.
What was also said in Krauz about when a mortgagee sought possession under s36 but the mortgagors made an application under s91 to sell themselves?
If the mortgagor wanted to defer possession to sell property himself where it was in negative equity he had to show he had private means to clear the shortfall otherwise s36 could not be used.
What does it mean to say a property is in negative equity?
The market value of the property is less than the mortgage debt.
J wants to sell his house worth £150,000. There is a legal charge over the property in favour of Glass Bank securing a debt of £200,000. M has offered to buy the house but J has no means of payi off the £50,000 that would remain owing. M is not willing to take over this debt. Would J need the consent of the bank to sell?
Yes, as the bank has no obligation to remove the legal charge if it is not cleared.
J is up to date with his mortgage repayments and has offered to repay the outstanding £50,000 after the sale. GBank won’t agree to remove the legal charge. Do the courts have jurisdiction to require GBank to remove the charge from the property if the sale went ahead?
Yes (s91 LPA 1925 allows them to do this; Palk).
Which of the following correctly describes the situation that arose in the case of Palk?
- both the mortgagee and the mortgagor wanted to sell the property
- only the mortgagor wanted to sell the property
Only the mortgagor wanted to sell the property.
In Palk the property was in negative equity and the mortgagee suggested the property should be rented out until the market improved. True or false?
True.
In Palk, the court used its powers under s91 LPA 1925 to order a sale of the property against the wishes of the mortgagee. It said that it needed to do so to avoid manifest unfairness. What did they mean by that?
The mortgagee’s proposal to rent the property would have resulted in the debt significantly growing each year with no certainty when the market would improve and return the property to positive equity.
What is the situation that arose in Barrett v Halifax?
Both the mortgagor and the mortgagee wanted to sell.
In the case of Barrett was the mortgagor in arrears with their mortgage repayments?
Yes.
In the case of Barrett, if the mortgagee and mortgagor both agreed about a sale going ahead why did the mortgagee object to the Barrtt’s selling the property?
It wanted to control the sale given it’s power of sale had arisen as a result of the Barrett’s mortgage arrears.
In the case of Barrett why did the court order a sale under s91 LPA 1925 against the wishes of the mortgagee?
Because an unoccupied property will get a better sale price than a repossessed property.
What is the meaning of the word reasonable period for paying off mortgage arrears?
The whole remaining length of the mortgage term but they must take these into consideration:
- ability of mortgagor to make the payments now and in the future
- likely duration of any temporary financial difficulty
- reason for the arrears
- period remaining of the original mortgage
- value of property measured against the amount owing
What is likely intended to mean with regards to repayment of arrears?
There must be a realistic chance, this must be supported by firm evidence of a detailed budget.
When the mortgagor wants to sell the property himself, what is meant by any sums due?
Repayment of the whole mortgage debt.
What is the meaning of the word likely in terms of selling the house himself?
Mortgagor has to show evidence in support of a sale occurring which will clear the debt.
What is a reasonable period in terms of the owner selling the house himself?
In National & Provincial Building Society v Lloyd it was indicated this could mean up to 1 year but no more. Bristol & West v Ellis said although 1 year was the maximum there was no fixed rule.
If J decided he wanted to ask the court to postpone possession to enable him to sell his property, what is the maximum period of time he is likely to be given to achieve the sale?
6 - 12 months (Bristol & West v Ellis).
In the case of Birmingham Building Society v Caunt, it was recognised that the court had an inherent power to postpone possession. However the court suggested that it could do so only for a very short period of around 28 days. Would a mortgagor ever apply to court under this jurisdiction rather than under the more generous jurisdiction of s36 AJA 1970?
Yes, it would be used by those whom s36 AJA 1970 was not available (communal mortgagor or residential mortgagor whose property has been peaceably repossessed).
Can the court order a sale notwithstanding the lender will be left out of pocket?
S91 LPA 1925 does give a court power to order a sale against the wishes of the mortgagee.
What point did the judge make in the case of Cheltenham and Gloucester v Krauz with regards to s91(2) LPA 1925?
It should only be used by a court in exceptional circumstances. If a mortgagee also wanted a sale they should be allowed to control it to prevent the mortgagor asking too high a price to put off the sale.
What was also said in Krauz about when a mortgagee sought possession under s36 but the mortgagors made an application under s91 to sell themselves?
If the mortgagor wanted to defer possession to sell property himself where it was in negative equity he had to show he had private means to clear the shortfall otherwise s36 could not be used.
What does it mean to say a property is in negative equity?
The market value of the property is less than the mortgage debt.
J wants to sell his house worth £150,000. There is a legal charge over the property in favour of Glass Bank securing a debt of £200,000. M has offered to buy the house but J has no means of payi off the £50,000 that would remain owing. M is not willing to take over this debt. Would J need the consent of the bank to sell?
Yes, as the bank has no obligation to remove the legal charge if it is not cleared.
J is up to date with his mortgage repayments and has offered to repay the outstanding £50,000 after the sale. GBank won’t agree to remove the legal charge. Do the courts have jurisdiction to require GBank to remove the charge from the property if the sale went ahead?
Yes (s91 LPA 1925 allows them to do this; Palk).
Which of the following correctly describes the situation that arose in the case of Palk?
- both the mortgagee and the mortgagor wanted to sell the property
- only the mortgagor wanted to sell the property
Only the mortgagor wanted to sell the property.
In Palk the property was in negative equity and the mortgagee suggested the property should be rented out until the market improved. True or false?
True.
In Palk, the court used its powers under s91 LPA 1925 to order a sale of the property against the wishes of the mortgagee. It said that it needed to do so to avoid manifest unfairness. What did they mean by that?
The mortgagee’s proposal to rent the property would have resulted in the debt significantly growing each year with no certainty when the market would improve and return the property to positive equity.
