What is the preferred position of a bank lending to a social landlord?
The preference of any lending bank would be for an agreement to contain an unqualified exclusion clause, so that the bank can be certain that if the social landlord defaults, it can recover the money it has lent by realising its security for the best possible value without delay. Any type of restriction on an exclusion clause will raise concerns with lending banks. However, it is becoming common for exclusion clauses to contain restrictions on the freedom of a lender to dispose of mortgaged property by imposing a delay of three months to two years before it can sell the property on the open market. What is the position of a local authority? The preference of any local authority would be for an agreement not to have any exclusion clause at all. Local authorities are concerned to ensure that affordable housing stock, partly funded by public money, is preserved by imposing restrictions in an agreement on the mortgagee’s power to dispose of the property on default. What are the consequence
