All adults who live in a property but don’t own it may have to sign an occupier consent form, but what is it and should you sign one?
An occupier consent form, which may also be called an occupier waiver form or deed of consent, essentially waives your right to live at a property if the borrowers break the repayment contract and the lender repossesses the property. Most people will not need to worry about this, but if you sign one and the property owner defaults on mortgage repayments, you may be left homeless. This is why you should get proper legal advice before you sign an occupier waiver form.
Some mortgage providers will need you to sign an occupier’s consent form. This is a means of ensuring that everyone will vacate the property in the event of a repossession. Signing the form means that everyone living there gives up their right to live there if it is repossessed.
Without an occupier’s consent form, adults living at the property could have what is known as a beneficial interest in the repossessed property. This means that they could potentially claim to have a right of occupation.
A beneficial interest in a property essentially means that you enjoy the benefit of living in the home or the benefits of any income that it generates. You can read more about this on the Shelter website at.
Pros and Cons
The major benefit of an occupier’s consent form is that mortgage lenders have protection from people making claims of right of occupation if a property is repossessed.
Conversely, people who sign such a form could end up losing their home and so it is vital to get proper legal advice before signing. This will ensure that you really understand all implications before you sign such a form.
If you refuse to sign, a mortgage lender may decide not to proceed with the loan. Some lenders will also refuse to proceed if you refuse to get proper legal advice.
Lenders will advise you to seek legal advice before signing the form. This is because you cannot then allege that you were pressured to sign it, unwittingly signed it, or didn’t really understand the implications of the legal document.
Who Might Be Affected?
Adult children and partners who are not named on the mortgage may need to consider this issue. For example, if a couple live together but the property is only in one name, the other partner may be asked to sign a waiver form.
In the example above, the cohabiting partner may also be asked to leave by the mortgage borrower and so there are several factors to consider if you are in this position. Otherwise, the partner who owns the property only has to give you ‘reasonable notice’. Once this expires, you would be considered to be a trespasser in the property.
If you don’t own the home, you could show that you have a beneficial interest, as we mentioned previously, or that you have an irrevocable or contractual licence.. Rights of estoppel are also a consideration but it is vital to get adequate legal advice to fully understand these terms and how best to protect yourself for the future.