Hi, I’m at the contract signing stage with a prospective tenant. My mortgage company have requested that I add the following custom Clause:
The Tenant hereby acknowledges that they’re aware that the property is subject to a mortgage and that, in the event of the Landlord (the Mortgagor) defaulting on the mortgage, the mortgagee may exercise its right to to take possession of the property under ground 2 of schedule 2 of the Housing Act 1998 for the purpose of disposing of it, and the Tenant hereby agrees and acknowledges that any right they may have under the tenancy is postponed in favour of the rights of the mortgagee.
The tenant has said that he knows it’s unlikely I’d default on the mortgage but understandably wants to know what notice the mortgage company would give him in this scenario. Does anybody know - would there be a general notice period enshrined in law of would it vary depending on the mortgage company? Many thanks in advance. Rebecca