What is an Occupiers Consent Form?
An Occupier's Consent Form, also known as a Deed of Consent, is a legal document that someone living in a property signs to acknowledge the existence of a mortgage on the property and to waive certain rights. This form is crucial for mortgage lenders as it ensures that the occupier cannot later claim rights that could interfere with the lender's ability to repossess the property if the borrower defaults.
Why is an Occupier's Consent Form Necessary?
Here are the main reasons why an Occupier's Consent Form is essential:
- Legal Protection for Lenders: It ensures that the lender can repossess the property without legal hindrance from the occupier if the borrower fails to meet their mortgage obligations.
- Clear Consent and Awareness: The occupier confirms that they are aware of the mortgage and the lender's rights, preventing future disputes or claims of ignorance.
- Smooth Repossession Process: In case of repossession, the process is smoother since the occupier has already waived their rights to remain in the property.
Who Needs to Sign an Occupier's Consent Form?
Anyone over the age of 17 living in the property who is not named on the mortgage should sign an Occupier's Consent Form. This includes:
- Adult children living at home
- Partners or spouses not listed on the mortgage
- Other family members or friends residing in the property
What Rights Does an Occupier Waive by Signing the Form?
By signing the Occupier's Consent Form, the occupier typically agrees to the following:
- Waiver of Occupation Rights: They waive their right to stay in the property if it is repossessed due to the borrower's default.
- Acknowledgement of the Mortgage: They acknowledge that the property is subject to a mortgage and that the lender has a secured interest in the property.
- No Claim to Equity: They confirm they have no claim to any equity or ownership in the property.
Frequently Asked Questions (FAQs)
Q: Can an occupier refuse to sign the form?A: Yes, an occupier can refuse to sign the form. However, this may result in the mortgage application being declined as the lender requires this consent for security reasons.
Q: Does signing the form affect the occupier’s credit score?A: No, signing an Occupier's Consent Form does not affect the occupier’s credit score as it is not a credit agreement but a legal acknowledgment.
Q: Is the form required for all types of mortgages?A: Generally, lenders require an Occupier's Consent Form for residential mortgages where non-mortgage holders live in the property. However, specific requirements can vary by lender.
Q: Do I need a solicitor to sign the form?A: While it is not always required to have a solicitor, it is often recommended to ensure the occupier understands the legal implications of the document they are signing.
Conclusion
An Occupier's Consent Form is a vital document in the mortgage process, safeguarding the lender's interests and ensuring a clear understanding and agreement from all parties involved. If you have someone living in your property who isn't on the mortgage, make sure they understand the importance of this form and the implications of signing it. For more detailed advice, consider consulting with a legal professional or mortgage adviser.