Repossession by your landlord’s mortgage lender

About repossession by your landlord’s mortgage lender

If you are a tenant or lodger of a private landlord, you could find yourself facing eviction if your landlord falls behind with their mortgage payments to their bank or building society.

This page tells you what your rights are and what you can do if you find yourself in this situation.

How you will know if the property is going to be repossessed

If your landlord falls behind with their payments, you may have:

• had a visit or letter from the lender letting you know that your landlord is in arrears with  their mortgage repayments and that the lender will therefore be seeking possession of the property

• opened letters addressed to the 'occupier' or 'persons unknown' giving details of a court action

• received a letter from sheriff officers giving a date when they will repossess the property.

How long can you stay in the property and what can you do to delay repossession

Do you have a right to stay

If your landlord falls behind with their mortgage payments, their mortgage lender could start court proceedings to repossess the property. This will usually give them permission to evict anyone who lives there, including tenants.

When you can stay in your home

You may have the right to stay in the property and cannot be evicted as soon as it has been repossessed if you have security of tenure. This may be the case if:

• you already lived in the property when your landlord purchased the property (that is, you were a sitting tenant)

• you moved in as a tenant before the mortgage was taken out (for example when the lender is taking action in respect of a second mortgage over the property)

• your landlord’s lender agreed to the tenancy.

You can find out when the mortgage was taken out by asking the lender or finding out from the Registers of Scotland. The date of the mortgage will be specified in the court summons.

In order to strengthen your case you can give the lender written proof of the date your tenancy began, eg a written tenancy agreement or rent book, fair rent registration or letter from the local authority housing benefit section.

However, the lender will not want you to stay in the property indefinitely once it has been repossessed. The lender steps into the landlord’s shoes once the property has been repossessed and will then to be able to terminate your tenancy by giving you notice as specified in your lease.

When you cannot stay in your home

If your tenancy began after your landlord took out their mortgage you will usually have no right to stay in the property once it has been repossessed. This is because mortgage agreements usually prohibit owners from letting out their property. Unless the lender has agreed to your tenancy it will be able to take action to have any occupier evicted as part of the court action to repossess the property.

You could make an homeless application to the council. You can do this if you're not yet homeless but at risk of becoming homeless within 2 months. See If you're homeless or at risk of homelessness. 

When do you have to leave your home

The amount of time you have before you have move out of the property may depend on the type of tenancy you have. For example, if you have a short assured tenancy, provided your landlord let you know that there was a mortgage over the property before your tenancy started, their lender would have to follow the same process to evict you as a landlord does. This means that they would have to give you notice that the tenancy is ending.

If you are uncertain about which type of tenancy you have you should consult an experienced adviser, for example, at a Citizens Advice Bureau - where to get advice.

How can you delay repossession of your home

Even if you are not an assured tenant, it does not mean that you have to leave the property right away.

The lender has to notify the occupier of the property by recorded delivery letter that legal action is being taken against the landlord. If you have notice of court proceedings let the lender know as soon as possible that you are a tenant. To be valid the notice must state that the property has tenant(s). If it does not, it must be amended before any action can be taken. This would give you more time to find new accommodation.

If you have received a letter from the sheriff officers giving a date when they intend to repossess the property or the sheriff officers arrive at your door requesting that you leave the property, you could try asking for time to ask the lender to suspend the warrant. This would give you more time to take legal advice or find alternative accommodation.

If you think that you have been discriminated against because of disability, gender reassignment, pregnancy and maternity, race, religion or belief, sex or sexual orientation, or that your human rights have been infringed in the course of possession proceedings you should seek advice.

To find out more about discrimination, see our discrimination in housing pages.

What can you do if the sheriff officers have already changed the locks

You may have been unaware of proceedings until you arrived home to find the locks changed and your possessions locked inside the property. You can:

• consider suing your landlord for breach of the covenant of quiet enjoyment and/or storage costs and emergency accommodation. You would then get compensation when the property is sold, if there is any money left over once your landlord’s debt to their lender has been paid off

• contact the lender or sheriff officers if you know who they are to arrange for someone to let you into the house to collect your belongings.

If you’re facing eviction because of your landlord’s mortgage arrears, you should get advice, for example, from a Citizens Advice Bureau - where to get advice.

If you’re homeless or about to be made homeless because of your landlord’s mortgage arrears, you may be able to get help from your local authority.

For more information about the help your local authority can give you if you’re homeless, see If you're homeless or at risk of homelessness.