Indemnity Insurance of Missing Deeds Lender conveyancing instructions
Bank of Scotland and Yorkshire Building Society, as with many mortgage companies, dictate their own requirements when it comes to missing deeds indemnity insurance. The content herein aims to help property law lawyers on the various mortgage company approved list of panel lawyers where the title to be charged contains missing deeds. It is not a alternative for checking the Council of Mortgage Lenders’ handbook requirements for each mortgage company, be it Lloyds TSB, Godiva Mortgages or Yorkshire Bank Home Loans. The information on this page Is not to be read as missing deeds indemnity insurance advice.
Need help with missing deeds indemnity insurance from your lender?
Virgin Money and RBS as with most lenders, instructions are such that where missing deeds indemnity insurance is to be put on risk:
- you is obliged to reveal to the insurer all relevant information which you have acquired
- the missing deeds indemnity insurance policy must not incorporate conditions that you are aware would void or prejudice the interests of the bank
- you are responsible for approving the terms of the missing deeds policy on behalf of the mortgage company
- your firm is duty bound to point out to the borrower that the borrower is obliged to adhere to any conditions of the missing deeds indemnity insurance policy and that the borrower should notify the lender of any notice or potential claim in respect of the insurance
- the limit of indemnity must meet the requirements for the bank (see UK Finance Lenders’ Handbook Part 2 )
- your firm must send a copy of the missing deeds indemnity insurance to the mortgagor and explain to the borrower why the missing deeds indemnity insurance policy was effected and that a further policy might be required if there is supplemental lending against the mortgaged property
- the missing deeds indemnity insurance policy should always be for the benefit of the lender and, wherever possible, in favour of the mortgagor and any subsequent registered proprietor or mortgage company. Where the mortgagor will not be covered by the missing deeds indemnity insurance policy, the borrower should be informed accordingly.
- the missing deeds indemnity insurance policy should be placed on risk at no expense to the bank
| Lender | Requirement |
|---|---|
| Allied Irish Bank | At least the amount of the mortgage advance. |
| Bank of Ireland Mortgages | The limit of indemnity must be an amount not less than the market value of the property. |
| Clydesdale Bank | Open market value of property. |
| Dudley Building Society | Purchase price or valuation, whichever is higher. |
| Family Building Society | An amount at least equal to the mortgage advance. |
| Fleet Mortgages | An amount at least equal to the valuation of the property. |
| Godiva Mortgages | Minimum of the value of the property. |
| Halifax | An amount at least equal to the mortgage advance. |
| Hinckley and Rugby | The policy must be for our benefit and for no less than the amount lent to the borrower, including retentions, stage payments and interest. |
| Legal & General Home Finance | The policy should be for the full market value of the property and indexed linked. The policy must be for our benefit, and for the benefit of the borrower where available. The policy must benefit all successors and assigns. |
| Molo Finance Buy to Let | 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 mortgages. |
| Mortgage Agency Services | 110% of the purchase price or valuation, whichever is greater |
| Mortgage Express | Amount of loan + 15% |
| National Westminster Bank | An amount equal to the value of the property. |
| Paratus | An amount equal to 110% of the valuation or purchase price - whichever is the greater. |
| Rely Mortgages | An amount at least equal to 110% of the mortgage valuation. |
| Rooftop Mortgages | The value of the property for mortgage purposes as disclosed in the valuation. |
| Skipton Building Society | For lender only cover we will accept a minimum of 110% (index-linked) of the amount of the loan. |
| Vida Homeloans | It must be for a minimum of 110% of the purchase price or valuation, whichever is greater |
General Missing Deeds indemnity insurance points to consider
The extent of the terms for missing deeds indemnity insurance are set out in the policy paperwork. Conveyancing Practitioners should direct your non-lender client to the missing deeds indemnity insurance policy paperwork. Missing Deeds indemnity insurance is designed to grant indemnity in respect of the risks set out in the policy schedule - so you should check the schedule to determine that it is correct. The duration of this non-investment insurance contract is in perpetuity unless otherwise stated in the missing deeds indemnity insurance policy. Again, please check that this is as you expected.Important characteristics and benefits of missing deeds Contingency insurance :
The insurance will normally cover where someone claims to be entitled to the benefit of the specified risks, stated in the missing deeds indemnity insurance schedule. Missing Deeds indemnity insurance Cover normally includes- Market value reduction due to the successful enforcement of the risks specified in the missing deeds insurance.
- The out of pocket expenses of altering or destroying 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.
- All sums paid with consent in writing from the insurance company to liberate the property from the risks specified in the missing deeds policy.
- Expenses for works (including architects’ and surveyors’ fees) for the purpose of the development commenced, prior to proceedings for the enforcement of the risks specified in the missing deeds insurance, to the extent that such costs are rendered abortive by court decision.
- All other costs and expenses incurred by the Insured with the written consent of the relevant insurance company
- Cover for compensation incurred in any action regarding the risks specified in the missing deeds indemnity insurance, including legal and associated costs.
Don't forget to consider what is not included in the missing deeds insurance e.g. does the policy cover any residence that has been altered within the 12 months prior to the commencement of the policy? Does it cover legal costs?
Additional considerations for missing deeds indemnity insurance
Missing Deeds insurance may satisfy lenders such as HSBC or Barclays 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 contained within this webpage is for general information for conveyancers and solicitors in England and Wales on the the mortgage company solicitor 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 missing deeds 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.