Need some advice on this clause

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    Need some advice on this clause

    Hi all.

    Had letter from estate agent asking if we'd like to extend our tenancy etc. Within the letter, it states 'including a mortgage clause'. After enquiring, I was emailed with the following:

    please find below the clause that you landlord wishes to be added into your tenancy agreement.

    The Landlord hereby notifies the Tenant that the Property is or may be his principal home and further gives notice to the Tenant that possession of the Property may be recovered under Ground 1 and Ground 2 in Part 1 of Schedule 2 to the Housing Act 1988, as detailed below:
    Ground 1:
    Not later than the beginning of the tenancy the Landlord gave notice in writing to the Tenant that possession might be recovered on this ground or the court is of the opinion that it is just and equitable to dispense with the requirement of notice and (in either case) -
    a) at some time before the beginning of the tenancy, the Landlord who is seeking possession or, in the case of joint Landlords seeking possession, at least one of them occupied the dwelling-house as his only or principal home;
    b) the Landlord who is seeking possession, or in the case of joint Landlords seeking possession, at least one of them requires the dwelling-house as his or his spouses only or principal home and neither the Landlord (or, in the case of joint Landlords, any one of them) nor any other person, who is landlord, derived title under the Landlord who gave the notice mentioned above requiring the reversion on the tenancy for money or moneys worth.
    Ground 2:
    The dwelling-house is subject to a mortgage granted before the beginning of the tenancy and -
    a) the mortgagee is entitled to exercise a power of sale conferred on him by the mortgage or by section 101 of the Law of Property 1925; and
    b) the mortgagee requires possession of the Property for the purpose of disposing of it with vacant possession in exercise of that power; and
    c) either notice was given as mentioned in Ground 1 above or the court is satisfied that it is just and equitable to dispense with the requirements of notice;
    and for the purposes of this ground, 'mortgage' includes a charge and 'mortgagee' shall be construed accordingly.
    For the avoidance of doubt: a court order must be obtained before possession can be granted.
    I know it's Monday morning and my brain doesn't kick in till Wednesday, but could someone explain why this would need to be put into the agreement or is it just a necessity that I don't need to worry about?

    #2
    i) You don't need an extension at all: If you stay in the property for 1 second beyond the end of the current fixed term a "periodic", rolling on, month-by-month (assuming rent paid monthly) tenancy will ensue on exactly the same terms as today, except that any terms regarding notice required will be junked & replaced with statutory terms of 1-2 months notice for tenant, 2-3 for landlord.

    ii) IF (you do not have to ..) you agree to a new tenancy the landlord wants to add those terms: He's probably required to by his lender, probably should be in already: It's his problem not yours if you refuse the terms, but likely he'd evict you. G2 gives mortgage company rights to repossess if Landlord doesn't pay his mortgage..

    Personally I'd studiously ignore agents request as likely they merely want to charge you (& landlord) a "fee" for printing a few sheets of A4..

    Cheers!
    I am legally unqualified: If you need to rely on advice check it with a suitable authority - eg a solicitor specialising in landlord/tenant law...

    Comment


      #3
      Thanks for such a prompt reply!

      Your second point makes sense as while we've been here this year, the LL got a new mortgage (we had surveyor round, etc).

      Our official 'end of tenancy' is tomorrow. (We only got letter this morning) so to demand £125 to renew out of the blue seems a bit unfair (and extremely expensive), however, at the same time, I don't want to do anything to rock the boat as we love the house and have had no issues with our Landlord.

      Comment


        #4
        Hmmnnn.. Think I'd keep quiet, do nothing, and see what happens - one might perhaps suggest the letter arrived too late...

        If you know the landlord you might ask him if he's happy to continue on a periodic basis.. However yes, signing/agreeing to a new tenancy does give you some more security, at least for the new fixed term..

        Are they putting the rent up?? Sending a letter one day before deadline sounds at least incompetent
        I am legally unqualified: If you need to rely on advice check it with a suitable authority - eg a solicitor specialising in landlord/tenant law...

        Comment


          #5
          Originally posted by theartfullodger View Post
          one might perhaps suggest the letter arrived too late...
          I have to admit, I did think that, too. However, with two young kids and previous experience of feeling unsettled I think for this year I'll begrudgingly pay the Estate Agent and then speak to Landlord towards end of tenancy next year about his future plans and interest in going periodic (will probably save him money, too!)

          Comment

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