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6 tips that will help mortgage lenders avoid enforcement disputes

As a bank or building society you know just how much effort is needed to bring possession proceedings against a borrower who has defaulted on their mortgage repayments. 

To try and help you avoid finding yourself in that position here are 6 tips we have found have helped the residential and commercial lenders we work with avoid enforcement disputes:

  1. Stay on top of your loan-to-value (LTV) ratio and make sure your terms and conditions entitle you to re-value a property on demand.
     
  2. Make sure you contact the customer immediately if they default on their account.
     
  3. Keep meticulous records of all communications you have with the customer (including telephone calls); these could be vital if a dispute arises or your customer makes a complaint.
     
  4. Continue to write to the customer even if they are not engaging or replaying.  A single letter of demand is not enough to satisfy your duty to act reasonably to customers.
     
  5. Be prepared to be flexible when to comes to offering terms of payment plans or instalments; rectifying the default by agreement is far simpler and almost always quicker than enforcing.
     
  6. Ensure you have an address for service in the UK if the customer is based overseas.

At Goodman Derrick our dispute resolution team has extensive experience of working with a range of banks, building societies and other high street lenders.  If you would like to discuss a more time- and cost-effective way to settle mortgage enforcement disputes please email Nick Cook at ncook@gdlaw.co.uk or call Nick on 0207 421 7938.

This guide is for general information and interest only and should not be relied upon as providing specific legal advice. If you require any further information about the issues raised in this article please contact the author or call 0207 404 0606 and ask to speak to your usual Goodman Derrick contact.