Legal & General Home Finance
Lifetime Mortgage Terms and Conditions
2020 Edition 2
2
Contents
A. INTRODUCTION 3
B. ABOUT YOUR LIFETIME MORTGAGE 3
1. Interest applicable to your Lifetime Mortgage 3
2. Charges you must pay 3
3. Additional borrowing and drawdowns 4
4. No Negative Equity Guarantee 5
C. WHAT YOU NEED TO DO DURING THE LIFE OF YOUR LIFETIME MORTGAGE 5
5. Your obligation to repay 5
6. Your other obligations 5
7. Your obligation to insure the Property 6
8. Environmental Notices 6
D. CHANGES TO YOUR CIRCUMSTANCES 6
9. Moving home 6
10. Moving others into the Property 7
11. Letting the Property 7
12. Selling the Property 7
E. REPAYING YOUR LIFETIME MORTGAGE 7
13. Repaying your Lifetime Mortgage when a Repayment Event occurs 7
14. How to repay your Lifetime Mortgage early 8
15. General repayment conditions 8
16. When we can retain or reinstate your Lifetime Mortgage 8
F. OUR POWERS IN CONNECTION WITH YOUR LIFETIME MORTGAGE AND YOUR PROPERTY 9
17. Our powers 9
18. Rights of a property receiver appointed by us 10
19. Related Rights 11
20. You appoint us as your attorney 11
G. GENERAL CONDITIONS 12
21. When we can sell, transfer or assign your Lifetime Mortgage to someone else 12
22. Using your information 12
23. Miscellaneous 12
24. Varying the terms of the Lifetime Mortgage 12
25. Sending notices to you 13
26. Governing law and jurisdiction 13
H. TERMS THAT APPLY IF THE PROPERTY IS IN SCOTLAND 13
27. Scotland 13
I. DEFINITIONS AND INTERPRETATION 14
28. Denedterms 14
29. Interpretation of these Conditions 15
3
A. INTRODUCTION
This document sets out the terms and conditions that apply to
your Lifetime Mortgage with us. You should read these
Conditions together with your Offer of Loan, the Mortgage
Deed, the Your Guide To Early Repayment Charges, and the
Tariff of Charges, all of which form part of your Lifetime
Mortgage with us.
Should there be any inconsistency between the documents
referred to above, we will give priority to the terms of the Offer of
Loan, then the Mortgage Deed, then the Your Guide To Early
Repayment Charges, then the Tariff of Charges
andnallythese
Conditions.
Property in Scotland
If your Property is in Scotland, there are some differences and
special Conditions that you need to know about which are set
out in Condition 27. If your Property is not in Scotland, then you
do not need to consider Condition 27.
Denitions and interpretation
YouwillndseveraltermsintheseConditions which are in bold.
ThisindicatesthatthetermisdenedinCondition 28 (unless it is
denedintherelevantCondition itself) and has the meaning
given to it in that Condition. Condition 29 also describes how we
interpret these Conditions.
When we refer to “you” or “your” in these Conditions, we are
referring to all Borrowers together (if there is more than one) and
each Borrower separately. Should you die, become bankrupt or
become unable to manage your affairs, references in these
Conditions to “you” also include your legal representatives, as
outlined more fully in Condition 29.
Examples, explanations and introductions
Weknowthatlegaldocumentationcansometimesbedicultto
understand, and we have tried to avoid legal language.
Sometimes this hasn’t been possible, and we have instead
included some examples and explanations to help you
understand the effect of the Condition. We have also inserted a
short introduction to Sections B to H of these Conditions, which
summarises what that Section is about.
These examples and explanations and the introductory
paragraphs to Sections B to H are clearly indicated by the keynote
box that they appear in. The examples and explanations and the
introductory paragraphs are non-exhaustive and illustrative. We
have included them to make the Conditions themselves easier to
understand but it is important to remember that they don’t tell
you everything you need to know or cover every possible
situation. You should always read the examples and explanations
and the introductory paragraphs in the context of the entire
Condition and with the rest of these Conditions.
If you have any doubts or questions about these Conditions or
any other document given to you in connection with your
Lifetime Mortgage, you should seek independent legal advice.
Dealing with you and your Lifetime Mortgage
We will comply with the Financial Conduct Authority’s rules and
guidance, and act honestly, fairly and professionally and have
regard to your best interests when dealing with you and your
Lifetime Mortgage.
B. ABOUT YOUR LIFETIME MORTGAGE
1. Interest applicable to your Lifetime Mortgage
1.1
For Interest Roll Up Lifetime Mortgages we will
calculate interest daily on the debit balance shown on your
Account at the end of that day and we will enter this
interest in your Account on a monthly basis on the last day
of each month.
1.2 For the purpose of calculating interest payable under the
Interest Roll Up Lifetime Mortgage, each day shall be
treated as 1/365th of a year (or 1/366th of a year in any
leap year).
1.3 For Optional Payment Lifetime Mortgages, on each
Payment Date we will calculate interest in respect of that
month based upon the Interest Rate and the Amount
Owed shown on your Account and add this interest to the
Amount Owed as shown on your Account.
1.4 For the purpose of calculating interest payable under the
Optional Payment Lifetime Mortgage, each month shall be
treated as 1/12th of a year and start on each
Payment Date.
1.5 Interest is charged on a compounding basis which means
that interest is charged on all of:
(a) the amount of the Loan;
(b) any Charges that are applied to the Account in
accordance with Condition 2; and
(c) any interest which has already been charged and
added to the Account.
1.6 Payments which are credited to your Account will, once
they are cleared funds, immediately reduce the balance on
which interest is charged.
1.7 Interest will continue to accrue on the Amount Owed at the
Interest Rate from when the Loan was advanced until the
Amount Owed is fully repaid. This includes the time from
when any Repayment Event occurs until the Amount Owed
is fully repaid. It also includes any period before and, so far
as allowed by law, after:
(a) any court order we obtain requiring payment; or
(b) any other action that we take when exercising our
powers in connection with the Lifetime Mortgage
and/or the Property, until the Amount Owed is
fully repaid.
2. Charges you must pay
Types of Charges
2.1 Your Offer of Loan sets out a number of fees (known as
Charges) which are part of the cost for your Loan and are
incurred prior to Completion. Separately there are a
number of Charges which may arise throughout the life of
your Lifetime Mortgage.
This Section B sets out further detail about your Lifetime
Mortgage and how it operates, in relation to the interest that is
payable and the Charges that you may incur. These Conditions
supplement the information about your Lifetime Mortgage in
yourOfferofLoan.Pleasepaycloseattentiontothetermsof
your Offer of Loan, which will prevail over these Conditions.
4
2.2 We will tell you when you have incurred a Charge. You must
pay us our Charges. Where we are able, we will set out the
amount of the Charges in our Tariff of Charges. Where we
are unable to state the amount of the Charge in advance
(because, for example, we incur external costs), we will
charge a reasonable amount together with the amount of
any external costs which we may incur.
2.3 We may apply Charges in the operation and administration
of your Account. The amount of these Charges will be set
out in our Tariff of Charges. Examples include (but are not
limited to):
• where you ask us to provide a document or a service in
connection with the Lifetime Mortgage, whether to you
or anyone else;
• a change of ownership if you wish to add or remove a
joint owner;
• changes affecting legal title to the Property;
• releasing part of our security under the Lifetime
Mortgage; and
• where you wish to transfer your Lifetime Mortgage to
another property.
2.4 We may reasonably incur Charges in order to safeguard
our security, which you must repay to us. This includes
Charges we reasonably incur because youfailtofullan
obligation you have under the Lifetime Mortgage. Where
youfailtofullanobligationundertheLifetime Mortgage
and we incur Charges as a result, we will reasonably
calculate any Charges (in respect of our mortgage lending
activities as a whole) payable by you.
2.5 Examples of circumstances where we may incur such
Charges include:
• any legal proceedings and any associated costs relating
to the Lifetime Mortgage;
• exercising any of the rights or powers given to us by law
or the Lifetime Mortgage;
• recovering any of the Amount Owed;
• doing anything you are obliged to do under the Lifetime
Mortgage but fail to do (such as insuring or repairing
the Property);
• taking action when there is an Event of Default; and
• protecting or preserving our security.
2.6 Where Charges are incurred because you have not
complied with the terms of your Lifetime Mortgage, any
action taken by us or on our behalf to protect our security
does not stop you being in breach. Similarly, your
repayment of the Charge, or the addition of the Charge to
the Amount Owed, does not stop you being in breach.
Failure to repay a Charge
2.7 If you do not pay a Charge within 10 days of the relevant
due date (which we will tell you) then we may at our
discretion add the Charge to the Amount Owed on your
Account. Where we add Charges to the Amount Owed, we
will charge interest on them. This interest will then be added
to the Amount Owed each month. Where there is more
than one Interest Rate on your Account, we will apply the
Charge to the Loan which incurs interest at the lowest
Interest Rate (unless the Chargerelatesspecicallytoone
Loan in particular, in which case we will apply the Charge to
that Loan and the Interest Rate applicable to that Loan
will apply).
Changes to Charges
2.8 We may introduce any change that abolishes a Charge or
reduces the amount of an existing Charge with immediate
effect and without giving you advance notice. We may
increase or add to the Charges set out in our Tariff of
Charges from time to time for any one or more of the
following reasons (which may relate to circumstances
existing at the time or which we reasonably expect to apply
in the future):
(a) to respond, reasonably, to changes in our costs of
funding that impact on the particular product or
service we provide to you, including:
(i) where we make changes to our technology or
other systems relating to the particular product
or service, we provide to you;
(ii) where we are required to meet changes in the
law and/or regulatory requirements, or to meet
changes in the interpretation of any existing law
and/or regulatory requirement; and
(iii) where appropriate, where we are required to
meet changes in the decisions or
recommendations of an ombudsman or
regulator, or any code of practice, which is or
are applicable to the conduct of our
business; and
(b) to correct mistakes if it is reasonable to do so.
2.9 Unless it is not reasonably practicable for us to do so,
where we increase or add to the Charges in the Tariff of
Charges, we will give you at least 30 days’ written notice of
the change to the Tariff of Charges. We will also ensure
that the change is proportionate to the underlying reason
for the change. We will provide you with the latest Tariff of
Charges at least once a year and it will also be available on
our website.
2.10 Unless it is not reasonable for us to do so, we will tell you
before taking any action which incurs a Charge.
3. Additional borrowing and drawdowns
3.1 Your Offer of Loan sets out the circumstances in which
you may apply for additional borrowing.
3.2 Your Offer of Loan sets out if you have a Drawdown
Facility. If you do, your Offer of Loan also sets out the
circumstances in which you may make a Drawdown. You
may not be able to make a Drawdown if you have breached
the Lifetime Mortgage and have failed to remedy
that breach.
Example: If you fail to insure the property as you are
required to do in these Conditions, you will be in breach.
We may take action to insure the property on your
behalf. The costs of doing so will be Charges. Even
though the property will be insured, it does not mean
that you are no longer in breach of these Conditions.
5
4. No Negative Equity Guarantee
4.1 Your Offer of Loan sets out the No Negative Equity
Guarantee which applies to your Lifetime Mortgage,
subject to Conditions 4.2 and 4.3 below.
4.2 The No Negative Equity Guarantee does not apply if you
decide to repay the Amount Owed early unless you do so
by a sale of the Property in accordance with Condition 12.
4.3 If you breach the Lifetime Mortgage terms and we incur
costs and Charges in remedying this breach (for example, if
you do not insure or repair the Property properly), the No
Negative Equity Guarantee will not extend to cover those
costs and Charges. This includes any interest which has
accrued on those costs and Charges.
C. WHAT YOU NEED TO DO DURING THE LIFE OF YOUR
LIFETIME MORTGAGE
5. Your obligation to repay
5.1 You must pay to us the Amount Owed in the manner and at
the time(s) set out in the Offer of Loan and these
Conditions.
6. Your other obligations
Things you must do
6.1 Throughout the life of your Lifetime Mortgage you must:
(a) unless agreed with us, only use the Property as a
private residence and as your Main Residence. If we
ask you to do so, youmustpromptlyconrmtous in
writing that this remains the case;
(b) maintain the Property in a state which we consider is
a state of good and substantial repair and condition.
We will act reasonably when deciding if the Property
is in a state of good and substantial repair and
condition. Where the Offer of Loan includes a
requirement that repairs are undertaken or building
works are completed before we advance any Loan to
you, you must ensure these repairs and/or works are
undertaken and completed in accordance with the
requirements in the Offer of Loan;
(c) observe and perform all legal restrictions, conditions
and obligations affecting the Property or its use,
including those in any lease relating to the Property;
(d) punctually pay all rates, taxes, rents, outgoings and
charges payable in respect of the Property;
(e) comply in all respects with all legislation (including
those relating to planning and environmental matters)
and all requirements and regulations of local
authorities and any other authorities which apply to
the Property;
(f) promptly give us any information about the Property
which we may reasonably ask for;
(g) provide us with a copy of any notice, order or
proposal concerning the Property. You must do so
within 7 days of receiving it. We may ask you to
respond to it and you must make all statements
which we reasonably ask you to make. Unless we tell
you otherwise, you must take all reasonable and
necessary steps to comply with the notice, order or
proposal; and
(h) where the Property is leasehold, inform us of any
notice served under any of the Leasehold Reform
Acts in relation to the Property. You must do so
within 4 Working Days of the notice being served. If
we request you to do so, you must also execute in our
favour a legal mortgage of the freehold, or any
superior lease or any new lease, which you obtain.
The legal mortgage must be in a form that we
reasonably require.
The Leasehold Reform Acts mean the Leasehold
Reform Act 1967 and the Leasehold Reform, Housing
and Urban Development Act 1993.
Explanation: Condition 2 sets out some examples of
when you may incur a Charge. If you fail to pay the
Charge to us, we will add it to the Amount Owed and
interest will be charged on it. The amount of the interest
couldbesignicant,especiallyifitisleftunpaidfora
long time. Because the No Negative Equity Guarantee
does not apply to the unpaid Charge and the interest on
it, there could be an amount (equal to the Charge and
the interest) that you or your estate has to pay to us even
after your Property has been sold.
This Section C sets out some important responsibilities that
you have in relation to your Lifetime Mortgage. It contains
important Conditions relating to the Property. If you do not
meet your responsibilities, you will be in breach of these
Conditions. It is important that you take the time to
understand and become familiar with your responsibilities.
Example: Your Property may be subject to a legal
restriction not to build anything in your garden or a
condition to maintain a fence in a certain position.
Where your property is leasehold, your lease of the
property may include restrictions against keeping
pets or playing loud music or a condition to ask
your landlord for consent before you carry out any
works to your property. There are other examples
which are not included here. In each case, you
would need to make sure you comply with the
legal restriction, condition or obligation. These are
limited examples, and you should consider
documents relating to your Property such as your
lease together with these Conditions to ensure
thatyouarecomplying.
Example: One example of such a notice is where
you may receive a letter from your local authority
informing you of a breach of building regulations in
relation to your property or about new road
proposals affecting your property.
Explanation: The Leasehold Reform Acts contain
rights for tenants of long leases in certain
circumstances to obtain an extension to their
lease and/or to acquire the freehold. If you
exercise any rights under these Acts (for example,
by serving a notice on your landlord requesting a
lease extension), you must inform us about this
and inform us about correspondence you receive
from your landlord. If you acquire the freehold, any
superior leasehold title or any new lease, we may
ask you to sign a new form of legal mortgage in
order to protect our security interest in
the Property.
6
Things you must not do
6.2 Throughout the life of your Lifetime Mortgage you must
not do (or allow anyone else to do) any of the following
without our prior written consent (which we will act
reasonably in granting or refusing):
(a) make any structural or material alteration or addition
to the Property;
(b) make any change in the use of the Property which
would require planning permission or approval under
any building regulations;
(c) apply for any improvement or similar grant in respect
of the Property;
(d) move out of the Property;
(e) sell or create any lease or tenancy over all or any part
of the Property (see Section D for more information);
(f) grant or allow any right over all or any part of
the Property;
(g) allow someone to move into the Property (see
Section D for more information); or
(h) create or allow to exist any other mortgage, standard
security or charge on the Property except for the
charge created by the Mortgage Deed.
7. Your obligation to insure the Property
7.1 You must keep the Property insured throughout the life of
your Lifetime Mortgage against all risks against which it is
usual to insure properties of a similar type and location.
Theserisksinclude(butarenotlimitedto)re,subsidence,
ood,escapeofwater,stormandanyotherrisksaswe may
from time to time reasonably require or agree. Your Offer of
Loan may set out additional requirements in this respect,
which you must comply with.
7.2 It is your responsibility to make sure that the amount of
insurance and risks covered are adequate. We consider that
the amount of insurance is adequate if it covers the full
reinstatement value of your Property or, if it is a higher
amount, the market value of your Property. When
considering if the risks covered by your insurance policy are
adequate, we will take into account the nature and location
of your Property.
7.3 It is also your responsibility to pay the insurance premiums
on time. We may ask you to provide to us copies of your
insurance policy document(s) and/or evidence of your
premium payments. Where we ask you to do so, you must
provide the copies to us promptly to demonstrate that you
have adequate insurance in place.
7.4 If you fail to insure the Property, or if you fail to provide
copies of your policy document(s) and premium receipts to
us within a reasonable period of time, we may ourselves
insure the Property and recover all reasonably incurred
costs of doing so from you. These costs will be Charges
that you must pay and will be applied in accordance with
Condition 2.
7.5 You will not do, or allow anyone else to do, anything which
may make the insurance of the Property invalid.
7.6 Subject to the rules of the Financial Conduct Authority, we
may accept and retain commission or other non-monetary
benetsinrespectofinsurancepoliciesthatareputin
place through any of our agency arrangements.
7.7 You must use any monies which become payable under
your buildings insurance policy to repair or reinstate the
Property, or if we agree to it, the monies must be used to
reduce or repay the Amount Owed. If there has been
signicantlossordamagetotheProperty, we may instruct
your insurance company to pay all claims money directly to
us, but if the claims money is paid to you, you will hold it on
trust for us.
8. Environmental Notices
8.1 An Environmental Notice means any notice in respect of
any contamination or pollution issued under any
environmental legislation which relates to the Property or
any neighbouring property.
8.2 Regardless of any other provision in the Lifetime Mortgage:
(a) we are entitled to carry out any works ourselves or
require any works to be carried out where such works
are required either to comply with an Environmental
Notice or to remedy any circumstances which could
lead to the issue of an Environmental Notice;
(b) you will immediately notify us if an Environmental
Notice is issued, or if you become aware of any
circumstances which may lead to the issue of an
Environmental Notice. In either case, you will provide
written details to us of the steps you intend to take to
remedy the circumstances or comply with the
Environmental Notice;
(c) you will permit us to inspect the Property at any
reasonable time (and, where practicable, upon
reasonable prior notice) in connection with an
Environmental Notice or in circumstances which we
reasonably consider may lead to the issue of an
Environmental Notice. The inspection of the Property
may include taking samples or making trial pits or
boreholes; and
(d) you will not create or allow any circumstances which
could lead to the issue of an Environmental Notice.
D. CHANGES TO YOUR CIRCUMSTANCES
9. Moving home
9.1 Your Offer of Loan sets out the circumstances in which
you may transfer your Lifetime Mortgage to a new
property when you move home. However, you must tell us
in advance and we must give our consent before you can
transfer your Lifetime Mortgage to your new property.
Explanation: An Environmental Notice is likely to be a
letter from your local authority or the Environment
Agency informing you that they have concerns about
contamination in the ground within your property or a
neighbouring property.
During the life of your Lifetime Mortgage, your circumstances
may change. This Section D sets out what you must and must
not do if you wish to move home, move occupiers into your
home, let your home or sell your home. See Section E in
relation to repaying your Lifetime Mortgage.
7
9.2 If you are unable to transfer your Lifetime Mortgage to
your new property (for example, because your new
property does not satisfy our eligibility criteria), the Amount
Owed must be repaid to us upon the sale of the Property
(as set out in Condition 13). The sale of the Property may
result in you having to pay an Early Repayment Charge,
depending on the circumstances of the sale (see Condition
14 and your Offer of Loan for more information). Where our
Downsizing Protection benet applies, no Early
Repayment Charge will be payable, as explained in your
Offer of Loan.
10. Moving others into the Property
10.1 Your Offer of Loan sets out our requirements if you intend
to allow any person to move into or occupy the Property,
even if you do not intend for that person to be added to the
Lifetime Mortgage. You must not allow any other person to
move into or occupy the Property before complying with
those requirements.
10.2 We may in some circumstances, agree for an additional
borrower to be added or removed from your Lifetime
Mortgage but we are not obliged to do so. You must
contact us if you wish to apply to make changes to the title
to the Property.
11. Letting the Property
11.1 You may not without our prior written consent:
(a) grant or renew (or agree to grant or renew) any lease
or tenancy of the Property or licence to occupy the
Property; or
(b) part with or share possession of the Property.
We may impose reasonable conditions upon any
consent we give.
11.2 The statutory power of a mortgagor to lease, agree to lease
and accept surrenders of leases will not apply to the
Lifetime Mortgage.
12. Selling the Property
12.1 If you decide or are required to sell your Property during
the life of your Lifetime Mortgage, you will be responsible
for all costs and expenses involved in selling the Property.
12.2 You must give us prior written notice of your intention to
sell the Property before putting the Property up for sale.
You must also provide us with any information that we
reasonably require in connection with the sale, including the
price at which you propose to sell the Property (which is
referred to in these Conditions as the Proposed Sale
Price). You must ensure that vacant possession is given
when the sale is completed, meaning all occupants must
leave the Property by the day of completion of the sale.
12.3 Before you agree to sell your Property, we will reasonably
estimate in good faith the Net Sale Proceeds that will be
available on completion of the sale to repay the Amount
Owed on the basis of the Proposed Sale Price.
12.4 If our estimate indicates the Net Sale Proceeds will not be
enough to repay the Amount Owed (taking into account any
Protected Percentage where you have an Inheritance
Protection Option), we may instruct a valuer to value the
Property. If the valuation indicates a value which is higher
than the Proposed Sale Price, we can insist that the
Property is sold for no less than this value (the
‘Valuation Price’).
12.5 If we instruct a valuer, the valuer’s fees will be Charges that
you must pay, which will be applied in accordance with
Condition 2.
12.6 No sale of the Property may occur for less than the
Proposed Sale Price (or, if there is one, the Valuation Price)
without our prior written consent. We will not withhold our
consent if it is shown to our reasonable satisfaction that
the sale is at the best price reasonably obtainable. As an
alternative to giving consent we may purchase the Property
ourselves at a price equal to the highest genuine
offer received.
12.7 If you sell the Property and are required to repay your
Lifetime Mortgage, you may have to pay an Early
Repayment Charge depending on the circumstances of the
repayment. Your Offer of Loan sets out the details of the
Early Repayment Charge.
E. REPAYING YOUR LIFETIME MORTGAGE
13. Repaying your Lifetime Mortgage when a
Repayment Event occurs
Repayment Event
13.1 We must be immediately informed if a Repayment Event
takes place or any event occurs which is likely to result in a
Repayment Event taking place.
A “Repayment Event” means the occurrence of any of
the following:
(a) the death of the borrower (or, if joint borrowers, the
last surviving of you dies);
(b) the borrower’s entry into Long Term Care (or, if joint
borrowers, the last surviving of you goes into Long
Term Care);
(c) the Property is sold;
(d) the Property is no longer used as your Main
Residence (or, if joint borrowers, the last surviving of
you ceases to use the Property as his or her Main
Residence); and
(e) any Event of Default occurs.
13.2 Where the Repayment Event falls within parts (a) or (b) of
Condition 13.1 above, the Amount Owed must be repaid to
us within 12 months of the date of that Repayment Event. If
you need to sell the Property in order to repay the Amount
Owed, you must make reasonable efforts to sell the
Property as quickly as you reasonably can after that
Repayment Event. If the Amount Owed is not repaid to us
within this 12-month period, this will be an Event of Default.
We can request earlier repayment from you if in our
reasonable opinion the value of the Property is either:
(a) less than the Amount Owed; or
(b) likely to be less than the Amount Owed in the
12-month period following the Repayment Event.
Explanation: This means that you cannot lease or let
your Property without our consent.
Your Lifetime Mortgage is designed to last for your lifetime
and is repayable when you (or, if borrowing jointly, both of you)
die or move out of your home into long term care. However,
there are other circumstances when your Lifetime Mortgage
must be repaid to us. You may also wish to repay the Lifetime
Mortgage early. This Section E contains Conditions relating to
the repayment of your Lifetime Mortgage debt.
8
If this is the case, we can give you notice to this effect at
any time after the Repayment Event, in which case you
must repay the Amount Owed to us (adjusted, if applicable,
according to Condition 5 and Condition 13.7) immediately
following the date we give you that notice or, if a different
dateisspeciedinthatnotice,bythedatespecied.
13.3 Where the Repayment Event falls within parts (c), (d) or (e)
of Condition 13.1 above, the Amount Owed (as adjusted by
Conditions 5 and 13.7) must be repaid to us and shall
immediately become due and payable.
13.4 Any sale of the Property by you following a Repayment
Event must be undertaken in accordance with
Condition 13.
13.5 Once the Amount Owed becomes payable, we may
exercise certain powers in order to protect our rights and
interests. These powers are set out in Section F below.
13.6 Following any Repayment Event, you must continue to
comply with the obligations in the Lifetime Mortgage
(including, but not limited to, the requirements set out in
Conditions 6 and 7 about what you must and must not do
in connection with the Property).
Net Sale Proceeds
13.7 If the Net Sale Proceeds from a sale of the Property are
less than the Amount Owed (taking into account any
Protected Percentage), we will inform you of the shortfall
but you will not have to repay the shortfall to the extent that
the No Negative Equity Guarantee applies. This Condition
13.7 only applies if you have complied with:
(a) the requirements in Condition 12 about selling your
Property; and
(b) the remainder of this Condition 13.
13.8 If any Repayment Event occurs and we reasonably
consider that the Net Sale Proceedswillbeinsucientto
repay the Amount Owed, we may spend such amounts of
money as wereasonablyseettomaketheProperty more
marketable. We may also incur independent surveyors’ fees
on or following the Repayment Event to establish whether
insucientmoneywillarisefromthesaleoftheProperty
to repay the Amount Owed. All such amounts and fees will
be Charges that you must pay, which will be applied in
accordance with Condition 2.
13.9 Net Sale Proceedswillbeusedrstlytowardspaymentof
the Amount Owed. Where the Net Sale Proceeds obtained
from a sale of the Property exceed the Amount Owed, we
will inform you of the surplus amount, which will be
reimbursed to you or your legal representative(s) for your
benetorthebenetofyour estate or any subsequent
chargee (as the case may be).
14. How to repay your Lifetime Mortgage early
14.1 Subject to Condition 15.1 below, you may repay your
Lifetime Mortgage by repaying the Amount Owed early in
accordance with the terms of the Offer of Loan.
14.2 Your Offer of Loan sets out the details of the Early
Repayment Charge which you may have to pay in certain
circumstances if you repay your Lifetime Mortgage early.
15. General repayment conditions
15.1 If you choose to repay or must repay the Lifetime
Mortgage, you must at the same time repay every other
mortgage, standard security or charge which we then hold
from you. Section 93 of the LPA 1925 shall not apply to the
Lifetime Mortgage.
15.2 Where you have more than one Loan with us, we will decide
which Loan to allocate your payments to.
16. When we can retain or reinstate your
Lifetime Mortgage
16.1 Once the Amount Owed is repaid in full to us, we will
release the security constituted by the Lifetime Mortgage,
subject to Condition 15.1, Condition 16.2 and
Condition 16.4.
16.2 We may retain any security granted in respect of the
Lifetime Mortgage for a period of up to 3 months after the
Amount Owed is repaid and all your obligations and
liabilities to usaresatisedordischarged.Ifduringsuch
3monthperiodanybankruptcyproceedingsarestarted
against you or any bankruptcy order is made against you
(or any other person that makes payment of, or discharges,
your obligations and liabilities to us), we may retain the
security for a further period, as we determine (acting
reasonably).
16.3 Our right to retain any security in accordance with
Condition 16.2 is conditional upon us receiving
professional advice that there is a reasonable risk that:
(a) the repayment and discharge of the Amount Owed
may be invalidated, reinstated or clawed-back upon a
bankruptcy order being made against you or upon
bankruptcy proceedings being started against you
during the 3-month period referred to in
Condition 16.2; and
(b) upon such reinstatement, invalidation or clawing-back
of the Amount Owed becoming effective, the security
for the Lifetime Mortgage is not automatically
reinstated or re-granted in our favour.
16.4 Any release, discharge or settlement of the Lifetime
Mortgage between you and us shall be conditional upon no
payment, disposition or assurance made to us or any
security constituted by the Lifetime Mortgage being
declared void, or being set aside or being ordered to be
refunded for any reason after we have released the security
constituted by the Lifetime Mortgage. If such condition is
notsatised,we may subsequently enforce this Lifetime
Mortgage as if the release of security had not occurred and
any such payment, disposition or assurance had not been
made. We may concede or compromise any claim that any
such security, disposition, assurance or payment is liable to
avoidance or repayment without prejudice to our rights
under this Lifetime Mortgage.
Explanation: This means that if you hold more than one
mortgage with us you will need to repay all of them at
the same time.
Example: If you become bankrupt shortly after you
repay the Lifetime Mortgage and there is a claim by the
trustee in bankruptcy for us to return to the trustee in
bankruptcy the amount that you had repaid to us (so we
would no longer hold the amount paid), we may reinstate
our security over the Property and treat the Lifetime
Mortgage as if it had not been repaid.
9
F. OUR POWERS IN CONNECTION WITH YOUR
LIFETIME MORTGAGE AND YOUR PROPERTY
17. Our powers
17.1 For the purposes of the LPA 1925 the mortgage money will
be treated as due, and the statutory power of sale (as
extended by these Conditions) and the other powers
contained in section 101 of the LPA 1925 will arise, one (1)
month after the date of Completion.
17.2 The statutory power of sale applies to the Lifetime
Mortgage free from the restrictions in section 103 of
the LPA 1925.
17.3 Regardless of any other provisions of these Conditions, the
Amount Owed shall immediately become due and payable
on demand if any Event of Default occurs.
17.4 We (or a third party acting on our behalf) may enter the
Property to carry out repairs if the Property is not being
adequately maintained. The Offer of Loan sets out our
rights in this regard. No exercise of any such right shall
make us liable as a mortgagee in possession.
17.5 At any time after the Amount Owed has become due and
payable, we may (without previous notice to or
agreement from you):
(a) take possession of the Property;
(b) appoint one or more persons to be a receiver of all or
any part of the Property;
(c) sell the Property (whether or not we have taken
possession); and/or
(d) exercise all the other powers given to mortgagees by
the LPA 1925.
17.6 At any time after the Amount Owed has become due and
payable, we or any receiver appointed by us may:
(a) carry out repairs, renewals or improvements to
the Property;
(b) carry out any building or development works on
the Property;
(c) apply for and obtain any appropriate planning or other
consents and approvals in respect of the
Property; and/or
(d) exercise the statutory powers of leasing or accepting
surrenders of leases without the restrictions imposed
by law, including those contained in sections 99 and
100 of the LPA 1925,
in each case, as we or the receiver may in our or his/her
discretionreasonablythinkt.Noexerciseofanysuch
rights shall incur any liability (either to you or any other
person) or make us liable as a mortgagee in possession.
17.7 After taking possession of the Property we or any receiver
appointed by us may, as your agent and at your expense
(as a Charge which you must pay, which will be applied in
accordance with Condition 2), remove, store, sell or
otherwise deal with any goods or animals which you have
not removed from the Property. We will not be responsible
for any loss caused by our so doing. We will account to you
for all proceeds received, either by paying such amount to
you or setting it off against the Amount Owed (at our
discretion), but we will deduct all expenses that we
reasonably incur in dealing with the goods and/or animals.
If the proceeds received are less than the expenses we
reasonably incur, the remainder of the expenses will be a
Charge that you must pay, which will be applied in
accordance with Condition 2.
17.8 If we, or a receiver appointed by us, enters into possession
of the Property, we or that receiver may at any time give up
possession. If we decide to give up possession, we will tell
you as soon as possible.
This Section F sets out the rights and powers from which we
benetinconnectionwithyourLifetimeMortgage.Itincludes
additional Related Rights which you assign to us, and the
rights and powers of a property receiver that we may appoint
in connection with your Lifetime Mortgage. It also includes our
appointment as your attorney (although this is not the same
as a lasting power of attorney).
Explanation: Under legislation, mortgage providers
(including us) are given certain powers relating to the
mortgage, including the ability to sell the mortgaged
property when the mortgage money becomes due.
Explanation: Section 103 of the LPA 1925 sets out
various circumstances when we can exercise the
statutory power of sale referred to in Condition 17.1. This
Condition 17.2 excludes section 103, meaning we are
not restricted to exercising our powers only in those
circumstances contained in section 103, but also in
other circumstances (but always in accordance with
these Conditions).
Explanation: If a mortgage provider takes physical
possession of the mortgaged property, it will be
knownasa“mortgageeinpossession”,which
meansthemortgageproviderincurscertainliabilities
inrelationtothemortgagedproperty.ThisCondition
meansthatthestatutoryrequirementsandliabilitiesofa
“mortgagee in possession” will not apply to us if we
carry out repairs if your property is not being adequately
maintained.
Explanation: We can appoint someone (who may be a
third party) named a “receiver” to act on our behalf in
connection with your Mortgage. If a receiver is
appointed, they would have various powers (including
those listed in Conditions 17.6 and 18, as well as others),
such as the ability to sell the Property and use the
proceeds of sale to repay the Mortgage.
Explanation: Sections 99 and 100 of the LPA 1925 give
lenders the right to lease a property of which they have
taken possession after the borrower’s default if those
leases meet certain conditions (for example, in relation
to their term and the rent). These restrictions are
excluded so that if we take possession, we can lease the
property or accept a surrender of an existing lease
without any restrictions.
Explanation: If we (or a receiver appointed by us)
exercise the rights set out in this Condition 17.6, neither
of us will be treated as a “mortgagee in possession” and
the statutory requirements and liabilities of a
“mortgagee in possession” will not apply to us.
10
17.9 Neither we nor any receiver shall be liable, by reason of
entering into possession of the Property or for any other
reason, to account as mortgagee in possession in respect
of all or any of the Property, nor shall we or any receiver be
liable for any loss on realisation of, or for any act, neglect or
default of any nature in connection with, all or any part of
the Property for which a mortgagee in possession might
be liable as such.
17.10 No exercise of our rights under this Lifetime Mortgage
(including where a receiver appointed by us exercises those
rights) shall make us or the receiver liable as a mortgagee
in possession in respect of all or any part of the Property.
17.11 When we and any receiver appointed by us exercise our or
his/her powers under this Lifetime Mortgage, we may
engage and pay third parties to assist us. These third
parties will be acting on your behalf as your agents and you
will be responsible for their fees at such rates as we or the
receiver may reasonably agree. The remuneration will be a
Charge that you must pay, which will be applied in
accordance with Condition 2. If we appoint a third party, we
may revoke the appointment of that third party at any time,
and any receiver may do likewise. We will tell you if the third
party’s appointment is revoked.
17.12 We may revalue the Property at any time during the lifetime
of the Lifetime Mortgage. If it is necessary for the valuer to
enter the Property to conduct the valuation, we will give you
reasonable notice and you must permit this. Any
revaluation under this Condition 17.12 shall be at
our expense.
18. Rights of a property receiver appointed by us
18.1 A receiver appointed by us shall have all the
powers conferred:
(a) on mortgagees and/or receivers by the LPA 1925 (but
without the restrictions contained in sections 103 and
109 of that Act); and
(b) on administrative receivers by the Insolvency Act
1986 Schedule 1, except to the extent that any of
these powers are expressly or impliedly excluded by
the Mortgage Deed or these Conditions. In the event
ofambiguityorconict,thetermsoftheMortgage
Deed will prevail, followed by these Conditions.
18.2 We or any receiver appointed by us shall also have power
on your behalf and at your expense, and regardless of your
bankruptcy, death or insanity, to do or omit to do anything
which you could do or omit to do in relation to the Property.
This includes (without limitation) a right for us and any
receiver to:
(a) take possession of the Property and for this purpose
to take, defend, discontinue or compromise any
proceedings as weortheythinkt;
(b) generally manage the Property including collecting
and receiving rents, arranging necessary repair and
maintenance of the Property, ensuring compliance
with local authority requirements, maintaining,
renewing or increasing insurances and serving notice
under relevant housing legislation;
(c) without restriction, sell the Property (whether or not
we have taken possession) for a price and on terms
as wethinkt;
(d) without restriction, lease or sublease (as appropriate)
the Property, vary, assign, renew, terminate, surrender
or accept surrenders of leases, tenancies or licences
over the Property for a price and on terms and for
rentandpaymentaswethinktwithoutthe
restrictions imposed by law, including those
contained in sections 99 and 100 of the LPA 1925;
(e) sell any freehold or leasehold reversions created over
the Property;
(f) exercise, on your behalf and without having to give
you prior notice or obtain your consent, all the powers
and duties conferred on a landlord by law from time
to time without having any liabilities or responsibilities
to you as a result of doing so; and/or
(g) take and do any other acts and things we or
the receiver:
(i) consider desirable or necessary for protecting
our security constituted by the Lifetime
Mortgage or for realising the value of the
Property or any part of it;
(ii) consider incidental or conducive to any of the
rights or powers conferred on a receiver under
or by virtue of these Conditions or law; or
(iii) lawfully may do as your agent.
18.3 The receiver may incur costs in exercising his/her rights
and powers under the Lifetime Mortgage and may charge
such amount for his/her fees as we reasonably agree with
him/her. The receiver will be an agent acting on your behalf
and you will be responsible for his/her fees. These costs
and fees will be Charges that you must pay, which will be
applied in accordance with Condition 2.
18.4 We may remove any receiver appointed by us at any time.
We may also appoint a new receiver, either instead of or as
well as any existing or former receiver. We will give you
written notice if we do so.
Explanation: If we (or a third party acting on our behalf)
carry out repairs at your property, neither of us will be
treated as a “mortgagee in possession“ and the
statutory requirements and liabilities of a “mortgagee in
possession” will not apply to us.
Explanation: We can appoint someone (who may be a
third party or may be one of our employees) named a
“receiver” to act on your behalf in connection with your
Lifetime Mortgage. If a receiver is appointed, they would
have the same powers as we do. Condition 18 sets out
more information regarding receivers.
Explanation: Under legislation, mortgage providers
(including us) and receivers that we appoint are given
certain powers relating to the mortgage, including the
ability to sell the mortgaged property when the
mortgage money becomes due. This Condition 18.1
conrmsthatareceiverthatweappointwillbeable
toexercisethosestatutorypowers,unlessthese
Conditions say otherwise.
Example: The receiver would have power (amongst
other examples above) to commence or complete
building works at the Property (for example, if the fence
in the garden is damaged a receiver would have the
power to repair it).
11
18.5 We may appoint any one or more persons to be a receiver
of all or any part of the Property. If there is more than one
receiver appointed by us in connection with the Property,
each receiver may exercise individually all of the powers
conferred on a receiver under the Lifetime Mortgage and
to the exclusion of the other receiver or receivers (unless
the document appointing such receiver states otherwise).
18.6 Any receiver appointed by us may be one of our employees
or may be a third party.
18.7 Section 109(8) of the LPA 1925 shall be amended so as to
allow a receiver to pay any money owing by you in such
orderofpriorityashe/shethinkst.
19. Related Rights
19.1 Related Rights means:
(a) any option to purchase the freehold or superior
leasehold or a new lease of the Property;
(b) any right to acquire further or additional shares or
interests in the Property which are included in, or
otherwise granted to you in, a shared ownership lease
(or any documentation supplemental to or associated
with such lease);
(c) any right to receive money which becomes payable in
respect of the Property or following any damage to or
depreciation of the Property, including money
payable for mining subsidence or
compulsory purchase;
(d) any share or membership rights in a residents’
association, common hold association or
management company relating to the Property;
(e) any guarantees or insurances relating to the Property
including guarantees for work done to the
Property; and
(f) anyotherbenetorrightofanykindrelatingtothe
Property or its construction or title.
19.2 As further consideration for the Loan you assign your rights
inandthebenetoftheRelated Rights to us and agree
that we have full power to enter the Property and to
exercise and deal with all the Related Rights as being
absolutelyandbeneciallyentitledtothem.
19.3 If you receive any money in respect of any Related Rights
you will hold this on trust for us to use in accordance with
Condition 19.4 below.
19.4 Any proceeds of the Related Rights, after deducting all
costs reasonably incurred by us in dealing with the Related
Rights, will be applied in reducing the Amount Owed, and
any surplus will be paid to you or any other person who is
entitled to the surplus.
20. You appoint us as your attorney
20.1 As security for your obligations under the Lifetime
Mortgage you irrevocably appoint us, and any receiver
appointed by us, together and individually to be your
attorney in your name and on your behalf to do all things
set out in Condition 20.2 below. The attorney will be legally
entitled to act on your behalf.
20.2 Under the power of attorney, we may execute and deliver
any deed or document, exercise any rights or powers which
you have in respect of the Property or the Related Rights
and do anything else which we or the receiver think
necessary or desirable to:
(a) protect our security under the Lifetime Mortgage;
(b) exercise any powers contained in the Lifetime
Mortgage; or
(c) preserve the Property or the Related Rights (and
their value).
20.3 We (or a receiver appointed by us) may delegate the power
of attorney to any third party where reasonably necessary
in the exercise of our powers.
20.4 We and the attorney will not be liable to you for anything
done when exercising the power of attorney unless it is
done negligently.
20.5 You will on our request:
(a) sign (or execute and deliver) any document or deed;
(b) exercise any rights or powers which you have in
respect of the Property or the Related Rights; and
(c) do anything else which we or the receiver think
necessary or desirable,
in each case in order to:
(d) protect our security under the Lifetime Mortgage;
(e) exercise any powers contained in the Lifetime
Mortgage; and
(f) preserve the Property or the Related Rights (and
their value).
20.6 The power of attorney will end when we release the security
constituted by your Lifetime Mortgage. If we have to
reinstate our security in accordance with Condition 16.4,
the power of attorney will also be reinstated until we release
the security. You will sign (or execute and deliver) any
document or deed which we reasonably request in order to
appoint us (and any receiver appointed by us) as your
attorney, on the same terms and conditions set out in this
Condition 20.
Explanation: Section 109(8) allows a receiver to choose
the order in which debts are paid. The receiver can
decide to pay his/her fees before repayment of your
Lifetime Mortgage debt should he/she choose to do
this. You will be responsible for paying these fees, as set
out in Condition 18.3.
Explanation: Related Rights are rights that may arise in
connection with your Property. One example is where
you have any construction work carried out on the
Property and the builder gives you a warranty or
guarantee in relation to the work. This Condition 19
meansthatwemaybenetfromthatwarrantyor
guarantee. The list of Related Rights is set out in
Condition 19.1 below.
Explanation: This power of attorney means we (and any
receiver we have appointed) are legally entitled to act on
your behalf and able to sign documents relating to the
Property or the Mortgage on your behalf at any time if
we think it is necessary or desirable to protect our
interests. This is not the same as a lasting power of
attorney. The power of attorney only relates to the
matters set out in Condition 20.2 below.
Example: One example of how we may use the power of
attorney is to appoint builders on your behalf if we have
concerns that you are not keeping the property in
good repair.
12
G. GENERAL CONDITIONS
21. When we can sell, transfer or assign your Lifetime
Mortgage to someone else
21.1 We may at any time transfer or assign to any other person
thebenetof,andour rights under, all or any part of the
Lifetime Mortgage and any related security. We do not
need your consent to do so. If we do so, your rights and
obligations under the Lifetime Mortgage will not be
affected. You must continue to perform your obligations
under the Lifetime Mortgage as though you originally
entered into it with the transferee or assignee.
21.2 We may release to any actual or potential transferee or
assignee (and their advisers) any information we hold about
you, about the conduct of your Account and about any
related securities. We will release this information in
accordance with Condition 22.
22. Using your information
22.1 We will decide the purposes for which and the manner in
which any personal information we obtain relating to you is
processed. We will process all personal data relating to you
in accordance with our privacy policy from time to time
relating to the processing of personal data about you.
22.2 We may give any information and documents concerning
the Lifetime Mortgage or your Account to any person if:
(a) we are required to do so by law or by any
regulatory authority;
(b) we have a public duty to do so;
(c) it is necessary in order to enforce any provisions of
the Lifetime Mortgage;
(d) you ask us to give details to another person or agree
that we can give such details to another person;
(e) that person takes over, or may be entitled to take over,
any of our rights under the Lifetime Mortgage or is
responsible for the management or administration of
the Account or the Lifetime Mortgage at any time;
(f) that person provides services to us in connection
with your Account or the Lifetime Mortgage; or
(g) we think it is necessary or advisable to do so in
connectionwithanytransfer,saleornancing
arrangement which we may enter into or consider in
connection with the Lifetime Mortgage.
22.3 We will use the information which you give us, or which we
receive from any enquiries which you permit us to make
about you or which we require to be made, for processing
and administering your Account or the Lifetime Mortgage,
for customer service, market research, statistical analysis,
audit and administrative purposes.
22.4 We may record telephone calls that you make to us for our
mutual protection and to improve our customer service
standards.
23. Miscellaneous
23.1 If we fail to exercise or delay in exercising any right or power
that we have in connection with the Lifetime Mortgage,
this will not affect our ability to later exercise any of our
rights or powers. If we exercise any of our rights or powers
(in whole or in part), this will not affect our ability to exercise
them again in the future or to exercise any other
right or power.
23.2 If we agree with you that we will not exercise any of our
rightsorpowersonaspecicoccasion,thiswillnotprevent
us from exercising our rights and powers in the future and
will not affect the other terms of the Lifetime Mortgage.
23.3 The rights, powers and remedies provided in the Lifetime
Mortgage are cumulative and not exclusive of any rights,
powers or remedies provided by law.
23.4 Each of the provisions and/or sub-clauses of the Lifetime
Mortgage is severable and distinct from the others. If at
any time any one or more of such provisions becomes
illegal, invalid or unenforceable, this will not impair or affect
the legality, validity or enforceability of the remaining
provisions.
23.5 Only you and we may enforce the terms of the Lifetime
Mortgage. No provision of the Lifetime Mortgage will be
enforceable by a third party under the Contracts (Rights of
Third Parties) Act 1999.
23.6 We will communicate with you using the English language
and all our documents will be issued to you in English. If
you choose to use the services of an interpreter, we are not
a party to, or responsible for, those services which will be
subject to a separate privacy notice and terms and
conditions with any interpreter you choose to use.
24. Varying the terms of the Lifetime Mortgage
24.1 We may vary the terms of the Lifetime Mortgage from time
to time during the life of the Lifetime Mortgage without
your consent for the purpose of giving youthebenetof
enhanced or additional services which become available in
connection with the Lifetime Mortgage.
24.2 We may also vary the terms of the Lifetime Mortgage from
time to time during the life of the Lifetime Mortgage
without your consent for the purpose of responding
reasonably to:
(a) any change in the law, regulatory requirements or
codes of practice which is or are applicable to the
conduct of our business or the Lifetime Mortgage;
(b) any new or amended recommendation, requirement
or decision by any court, ombudsman, regulator or
similar body, including the Equity Release Council,
which is or are applicable to the conduct of our
business or the Lifetime Mortgage;
(c) any change to our technology or other systems used
in connection with the Lifetime Mortgage, including
where the change is needed either to improve the
operation of those systems or to integrate them with
the systems used by another organisation which we
acquire or by which we are acquired; and
(d) anymistakeswhichareidentiedandreasonably
requirechangesorrectication.
This Section G contains general Conditions relating to your
Lifetime Mortgage, including: (1) our ability to assign our rights
under the Lifetime Mortgage to any third party; (2) our use of
information we receive about you; (3) the circumstances in
which we may vary the terms of the Lifetime Mortgage; (4) the
law that applies to your Lifetime Mortgage; and (5) various
other miscellaneous Conditions.
Explanation: Not all our rights and powers under your
Lifetime Mortgage are listed in these Conditions or in the
Offer of Loan. Some are contained in statute and we are
able to use all those other rights and powers too.
13
24.3 We may also vary the terms of the Lifetime Mortgage from
time to time during the life of the Lifetime Mortgage
without yourconsentforanyotherreasonnotspeciedin
these Conditions provided any such change is
proportionate to the underlying reasons for the change.
24.4 We will give you at least 30 days’ written notice in advance
of any change we make pursuant to Conditions
24.2 and 24.3.
25. Sending notices to you
25.1 If we leave or send by prepaid post or by email any written
demand or notice addressed to you either to the Property
or any other address or email address that you make
known to us, you will be deemed to receive the notice.
25.2 Where we leave any demand or notice at the address
referred to in Condition 25.1, you will be deemed to have
received it at the time that we leave it there. Where we send
any demand or notice by post to that address or any other
nominated address, you will be deemed to have received it
two Working Days after posting. Where we send any
demand or notice by email, you will be deemed to have
received it on the date and at the time that we sent it.
26. Governing law and jurisdiction
26.1 The Lifetime Mortgage and any dispute or claim arising out
of or in connection with it or its subject matter or formation
(including non-contractual disputes or claims) will be
governed by English Law, unless Condition27applies.
26.2 The courts of England and Wales will have jurisdiction to
settle any such disputes or claims, unless Condition
27 applies.
H. TERMS THAT APPLY IF THE PROPERTY IS IN
SCOTLAND
27. Scotland
27.1 The provisions of this Condition 27 apply to the Lifetime
Mortgage if the Property is located in Scotland.
27.2 In these Conditions:
CFRA 1970 means the Conveyancing and Feudal Reform
(Scotland) Act 1970; and
CFRA Standard Conditions means the standard conditions
set out in schedule 3 to the CFRA 1970, which detail certain
obligations you have, and certain rights we have, in relation
to the Property.
27.3 The second paragraph of section A (Introduction) to these
Conditions is replaced by the following:
Should there be any inconsistency between the documents
referred to above, we will give priority to the terms of your
Offer of Loan, then your Mortgage Deed, then the Tariff of
Charges, these ConditionsandnallytheCFRA Standard
Conditions.
27.4 References in these Conditions and the Offer of Loan to
‘tenants in common’ are replaced by ‘joint owners’.
27.5 Conditions 6.1(h), 11.2 and 18 do not apply.
27.6 Condition 17 is replaced by the following:
17. Our powers
17.1 Regardless of any other provisions of these
Conditions, if any Event of Default occurs, the
Amount Owed shall immediately become due and
payable on demand and you will be in default
under the CFRA 1970, which would allow us to
enforce our security and exercise the rights
available to us under the CFRA 1970.
17.2 At any time after the Amount Owed has become
due and payable, we may (without previous notice
to or agreement from you):
(a) take possession of the Property;
(b) sell the Property (whether or not we have
taken possession); and/or
(c) exercise all the other powers given to
heritable creditors by the CFRA 1970.
17.3 At any time after the Amount Owed has
becomedueandpayable,we may if we consider it
necessary or desirable, at your expense and
regardless of your bankruptcy, death or insanity
and without being treated as a heritable creditor in
possession or becoming liable to account as such:
(a) take any proceedings wethinktinrelation
to the Property;
(b) generally manage the Property, including
collecting and receiving rents, carrying out
building and development works, arranging
necessary repair and maintenance of the
Property, ensuring compliance with local
authority requirements, maintaining,
renewing or increasing insurances, serving
notice under relevant housing legislation and
obtaining any appropriate planning or other
consents and approvals; and/or
(c) exercise, on your behalf and without having
to give you prior notice or obtain your
consent, all the powers and duties conferred
on a landlord by law from time to time in
force (including the power to grant, vary,
assign review, terminate, surrender or accept
surrenders of leases, tenancies or licences
over the Property so far as permitted by the
CFRA 1970) without having any liabilities or
responsibilities to you as a result of doing so,
ineachcase,aswe in our discretion
reasonablythinkt.Anycostsweincurwill
be a Charge that you must pay, which will be
applied in accordance with Condition 2.
Example: If we post a notice to you at 1pm on Tuesday,
you will be deemed to have received it at 1pm
on Thursday.
If the Property is in Scotland, your Lifetime Mortgage is
governed by the laws of Scotland. This Section H sets out the
special Conditions that apply to your Lifetime Mortgage if the
Property is located in Scotland.
Explanation: A “heritable creditor” is a legal term
for a person who holds a standard security over
a property in Scotland. Heritable creditors are
granted certain powers by law (including those
powers set out below in Condition 17.3, but
there are others as well).
14
17.4 After taking possession of the Property we may,
as your agent and at your expense (as a Charge,
which will be applied in accordance with Condition
2), remove, store, sell or otherwise deal with any
goods or animals which you have not removed
from the Property. We will not be responsible for
any loss caused by our so doing. We will account
to you for all proceeds received, either by paying
such amount to you or setting it off against the
Amount Owed (at our discretion), but we will
deduct all expenses that we reasonably incur in
dealing with the goods and/or animals. If the
proceeds received are less than the expenses we
reasonably incur, the remainder of the expenses
will be a Charge that you must pay, which will be
applied in accordance with Condition 2.
17.5 When we exercise our powers under your Lifetime
Mortgage, we may engage and pay third parties to
assist us. These third parties will be acting on your
behalf as your agents and you will be responsible
for their fees at such rates as we may reasonably
agree. The remuneration will be a Charge that you
must pay, which will be applied in accordance with
Condition 2. If we appoint a third party, we may
revoke the appointment of that third party at any
time. Wewilltellyou if the third party’s
appointment is revoked.”
27.7 References to a ‘receiver’ in Condition 20 do not apply.
27.8 In Condition 19.2 the words ‘by signing the Mortgage Deed’
will be added before the words ‘you assign’.
27.9 Condition 26 is replaced by the following:
26. Governing law and jurisdiction
26.1 The Lifetime Mortgage and any dispute or claim
arising out of or in connection with it or its subject
matter or formation (including non-contractual
disputes or claims will be governed by Scots law.
26.2 The courts of Scotland will have jurisdiction to
settle any such disputes or claims.”
27.10 Any other references in these Conditions to any word,
expression or practice under English law are references to
the equivalent or nearest equivalent word, expression or
practice under Scots law.
27.11 In interpreting the CFRA Standard Conditions ‘the creditor’
means ‘we’, ‘us’ or ‘our’ (as appropriate) and ‘the debtor’
means ‘you’, ‘your’ or ‘yours’ (as appropriate).
I. DEFINITIONS AND INTERPRETATION
28. Dened terms
28.1 Terms that are in bold in these Conditions have the
following meanings:
Account means the account we maintain recording the
Amount Owed;
Amount Owed means all monies (including any Loan,
interest and Charges) which you owe us at any time on the
security of the Lifetime Mortgage;
Borrower, you and your means the person(s) named as
borrowers in the Lifetime Mortgage and includes all
persons claiming any right or interest from or to you
(including your successors, personal representatives and
executors of your estate);
CFRA 1970 has the meaning set out in Condition 27.2;
CFRA Standard Conditions has the meaning set out in
Condition 27.2 ;
Charge(s) means all fees and expenses which we apply
(acting reasonably) in connection with the Loan and the
Lifetime Mortgage;
Completion means the date on which werstadvance
money under a Loan to you;
Conditions means these terms and conditions (including
the introduction in Section A);
Drawdown means any additional borrowing under the
Drawdown Facility;
Drawdown Facility means the facility of that name we
provide under the Offer of Loan (if any) as set out in your
Offer of Loan (if such a facility is available to you);
Early Repayment Charge means the early repayment
charge set out in the Offer of Loan;
Your Guide to Early Repayment Charges means our guide
on early repayment charges and which forms part of your
Lifetime Mortgage with us;
Event of Default means any of the following circumstances:
(a) the Amount Owed is not repaid to us following a
Repayment Event in accordance with the terms of
Condition 13.2;
(b) compulsory purchase or requisition of all or any part
of the Property;
(c) material false information or material omission in
information given to us, including fraud or money
laundering;
(d) the Property being used other than solely as a private
residence, unless agreed by us
(e) if you are or become bankrupt or enter into any
composition or arrangement with your creditors, or
you have been found by a court of competent
authority to have been engaged in criminal activity; or
(f) you are in material breach of your obligations under
these Conditions or the Offer of Loan and either you
have not remedied such breach within any reasonable
period we specify, or the breach cannot be remedied;
Explanation: if a mortgage provider takes
physical possession of the mortgaged property,
itwillbeknownasa“heritablecreditorin
possession”, which means the mortgage
provider incurs certain liabilities in relation to the
mortgaged property. If we exercise the rights set
out in this Condition 17.3, we will not be treated
as a “heritable creditor in possession”. This
means the statutory requirements and liabilities
of a “heritable creditor in possession”
will not apply.
15
Inheritance Protection Option is the option for you or your
beneciariestobeentitledtotheProtected Percentage, as
set out in your Offer of Loan (if you have selected
this option);
Interest Rate means the rate or rates of interest which
apply for the time being to the Amount Owed or any part of
the Amount Owed (including any Drawdown) as set out in
the Offer of Loan;
Lifetime Mortgage means the agreement for your Loan
which is comprised of the Offer of Loan, the Mortgage
Deed, the Your Guide to Early Repayment Charges, the
Tariff of Charges and these Conditions (and, if the
Property is located in Scotland, the CFRA Standard
Conditions);
Loan means each and every sum which we lend you on the
security of the Lifetime Mortgage (including each and
every additional borrowing you apply for and we agree and
each Drawdown (if any));
Long Term Care means care or supervision which you
require and which:
(a) requires you to receive care on an ongoing and long
term basis outside the Property, including but not
limited to entering into a residential care home,
nursing home, or moving in with family or friends
where there is no intention to return to the Property.
Long Term Care does not include temporary stays in
hospitals or to visit family or friends; and
(b) requires you to be absent from the Property for any
other reason for any period totalling 90 days or more
in any period of 180 consecutive days; and
(c) is necessitated by or attributable to your physical or
mental incapacity or impairment.
Acerticatesignedbyamedicalpractitionercertifyingthe
above will (in the absence of obvious error) be conclusive
evidence of this;
LPA 1925 means the Law of Property Act 1925;
Main Residence means the property in which you are
habitually resident (where you live most of the time);
Mortgage Deed means the mortgage deed (or, if the
Property is in Scotland, the Standard Security) signed by
you which incorporates these Conditions;
Net Sale Proceeds means the net sale proceeds that will
be available on completion of the sale of the Property, after
deducting all reasonable costs of sale, such as legal fees
and estate agent fees;
No Negative Equity Guarantee means that you or your
estate would not be left with an outstanding debt from the
Lifetime Mortgage where the Property is sold for the best
price reasonably obtainable (subject to certain conditions
set out in Condition 4);
Offer of Loan means the document named “Offer of Loan”
that we have given to you, containing our written offer and
setting out the particular terms and conditions on which we
will make a Loan to you;
Payment Date meansthedayofthemonthspeciedin
your Offer of Loan;
Property means the property described in the Lifetime
Mortgage and includes each and every part of such
propertyandallxturesandttings;
Proposed Sale Price has the meaning set out in
Condition 12.2;
Protected Percentage means the percentage of Net Sale
Proceeds which you have chosen to protect if you have
selected the Inheritance Protection Option (as set out in
the Offer of Loan);
Related Rights has the meaning set out in Condition 19;
Repayment Event has the meaning set out in
Condition 13.1;
Standard Security means a standard security in
accordance with the terms of the CFRA 1970 over
the Property;
Tariff of Charges means our tariff of charges which sets
out our standard fees and charges as in effect from
time to time;
Valuation Price has the meaning set out in Condition 12.4;
we, our and us means Legal & General Home Finance
Limited and includes our successors, assigns and
transferees whether legal or equitable and whether in
relation to all or part of the Amount Owed, and may at any
time mean more than one of them; and
Working Days means any day other than a Saturday,
Sunday or any day which is a public holiday in England and
Wales (if your Property is in England or Wales) or in
Scotland (if your Property is in Scotland).
29. Interpretation of these Conditions
29.1 Any reference to a “month” and “monthly” means a
calendar month.
29.2 Any reference to “you” includes your legal representatives
should you die, become bankrupt or become unable to
manage your affairs.
29.3 Where there is more than one Borrower:
(a) “you” and “your” refer to both of you together and
each of you separately;
(b) if either of you dies, becomes bankrupt or becomes
unable to manage your affairs this will not affect the
liability of the other one of you; and
(c) your liability to us is both joint and several which
means that we can enforce the Lifetime Mortgage
against any or both of you for the Amount Owed.
29.4 Any reference to any provision of any law includes that
provision as updated or altered at any time.
29.5 References to any document include all variations,
replacements and amendments to that document.
29.6 Any phrase introduced by the terms “including”, “include”, “in
particular” or a similar expression shall be construed as
illustrative and shall not limit the sense of the words
preceding those terms.
29.7 Any reference to these Conditions or to any other
document is a reference to these Conditions or to that
other document as validly amended, varied, supplemented,
restated or novated (in each case, other than in breach of
the provisions of these Conditions) at any time.
Legal & General Home Finance Limited is a wholly owned subsidiary of Legal & General Group plc.
Registered in England and Wales number 04896447.
Registered oce: One Coleman Street, London EC2R 5AA
Legal & General Home Finance Limited is authorised and regulated by the Financial Conduct Authority.
LG001354 DA438 01/24
