Indemnity Insurance of Matrimonial Homes Act Bank conveyancing requirements
Halifax and Yorkshire Bank Home Loans, in common with most lenders, have their own specific instructions when it comes to matrimonial homes act indemnity insurance. This page is designed to help conveyancing firms on the different mortgage company solicitors panel where the title for the the property to be mortgaged includes matrimonial homes act. Solicitors should still check the Council of Mortgage Lenders’ handbook requirements for each lender, for example Santander, Natwest or Virgin Money. The information on this page is not focused on matrimonial homes act indemnity insurance requirements.
Need help with matrimonial homes act indemnity insurance from your lender?
HSBC and Yorkshire Building Society like many lenders, obligations require that where matrimonial homes act indemnity insurance is to be taken out:
- you must supply a duplicate of the matrimonial homes act indemnity insurance to the borrower and explain to the mortgagor why the matrimonial homes act indemnity insurance policy was effected and that a further policy might be necessary if there is supplemental borrowing against the security of the property
- the limit of indemnity must satisfy the requirements for the mortgage company (See Part II Handbook requirements )
- the matrimonial homes act indemnity insurance policy must be for the benefit of the lender and, if possible, for the benefit of the borrower and any next owner or bank. Where the mortgagor will not be covered by the matrimonial homes act indemnity insurance policy, you must advise the borrower of this fact.
- the matrimonial homes act indemnity insurance policy should not contain conditions that you recognise would invalidate or compromise the interests of the mortgage company
- your practice must spell out to the borrower that the borrower is obliged to adhere to any conditions of the matrimonial homes act indemnity insurance policy and that the mortgagor should notify the lender of any notice or potential claim in respect of the policy
- your practice must reveal to the insurer all relevant information which you have obtained
- the matrimonial homes act indemnity insurance policy should be placed on risk without charge to the mortgage company
- your firm are responsible for approving the terms of the matrimonial homes act policy on behalf of the lender
| Lender | Requirement |
|---|---|
| Bank of Ireland | The limit of indemnity must be an amount not less than the market value of the property. |
| Barnsley Building Society | An amount at least equal to the amount of the mortgage advance. Any indemnity insurance policy must protect the borrowers, any successors in title and any mortgagee. |
| Bradford & Bingley | Amount of loan + 15% |
| Britannia | Cover to the full value of the property. |
| Coutts Finance | The open market value of the property according to the valuation report. |
| Fleet Mortgages | An amount at least equal to the valuation of the property. |
| Gen H | An amount equal to the value of the property unless specifically agreed in writing otherwise. |
| Godiva Mortgages | Minimum of the value of the property. |
| JPMorgan | 110% of principal sum. |
| LiveMore | An amount equal to the purchase price or value of the property, whichever is higher |
| New Street Mortgages | Must be for a minimum of 110% of the purchase price or valuation whichever is the greatest. |
| Parity Trust | An amount equal to at least 110% of the mortgage advance |
| Pepper Money | An amount equal to at least 110% of the purchase price or value, whichever is higher. Any indemnity insurance policy must be for our benefit, that of any transferee/assignee (legal or equitable) of the mortgage and also the borrower(s). |
| Perenna | The higher of the purchase price or valuation. |
| Precise Mortgages | An amount at least equal to 110% of the mortgage valuation. |
| Secure Trust Bank | An amount at least equal to the market value. Any indemnity insurance policy must be for our benefit, that of any transferee/assignee (legal or equitable) of the mortgage and also the borrower(s). |
| State Bank of India UK | The purchase price or value of the property, whichever is the higher. |
| RBS- First Active | An amount equal to the value of the property. |
| Ulster Bank | An amount equal to the value of the property. |
| Yorkshire Building Society | An amount at least equal to the amount of the mortgage advance. Any indemnity insurance policy must protect the borrowers, any successors in title and any mortgagee. |
General Matrimonial Homes Act indemnity insurance points to consider
The extent of the terms for matrimonial homes act indemnity insurance are set out in the policy document. Conveyancing Practitioners are obliged to direct the borrower to the matrimonial homes act indemnity insurance policy paperwork. Matrimonial Homes Act Contingency insurance is designed to provide indemnity in respect of the risks specified in the policy schedule - so it is essential check the document to determine that it is correct. The lifetime of this non-investment insurance contract is in perpetuity unless otherwise stated in the matrimonial homes act indemnity insurance policy. Again, please check that this is as you expected.Significant aspects and benefits of matrimonial homes act indemnity insurance :
Protection via such a policy is to cover the risk of third parties looking to enforce rights that can affect the use of a property. Matrimonial Homes Act indemnity insurance Policies should be checked for the following- The out of pocket expenses of altering or taking down all, or part of the development and the reinstatement of the land, insofar as such alteration, demolition or re-instatement is made necessary by court order.
- Money paid with consent in writing from the insurance company to liberate the property from the risks specified in the matrimonial homes act policy.
- Cover for compensation incurred in any action concerning the risks specified in the matrimonial homes act insurance, including legal and associated costs.
- All other costs and expenses incurred by the Insured with consent in writing from the relevant insurer
- Diminution in value due to the successful enforcement of the risks specified in the matrimonial homes act policy.
- Expenses for works (including professional fees) for the purpose of the development started, prior to proceedings for the enforcement of the risks specified in the matrimonial homes act insurance, to the extent that such costs are rendered abortive by court decision.
As is the case with all conventional insurance, all material information needs to be disclosed to the insurance company at the outset and throughout the policy term, otherwise the matrimonial homes act policy will be invalidated.
Further considerations for matrimonial homes act indemnity insurance
Matrimonial Homes Act insurance may satisfy lenders such as Barclays or Barnsley BS and prevent clients from from suffering financially but it cannot compensate for the stress and inconvenience the emotional suffering - after all the value of a home cannot always be measured in cash in the eyes of the owner. Information provided on this webpage is for general information for conveyancers and solicitors in England and Wales on the the mortgage company conveyancing panel, it does not constitute advice for members of the public who should contact their lawyer for advice relating to the mortgage company indemnity insurance. Whilst we endeavour to keep the information up to date and correct we do not make any representation or warranties of any kind about its completeness, accuracy, reliability or suitability. Any reliance you place on the information is strictly at your own risk. Lexsure will not be liable for any direct or indirect loss or damage arising out of or in connection with the use of this information.
An important exclusion applying to most matrimonial homes act Policies is if you make any contact with any party who might cause a claim under the Policy, it can invalidate the cover.
The above information is in relation to properties in England and Wales.