Foreclosure
In UK housing, foreclosure is a technical mortgage law term, but most private landlords will meet it in practice as the lender repossessing a mortgaged property when a buy-to-let mortgage falls into serious rent arrears. Today, courts and lenders normally use possession orders and sale, rather than strict foreclosure where the borrower’s ownership is entirely wiped out, but the effect for you as landlord can still be losing the property.
If your lender obtains a possession order, they can evict you and, in many cases, any residential tenants as well, particularly if the tenancy is not an authorised assured tenancy or there has been a breach of mortgage conditions. Tenants may still have protections, for example as sitting tenants, or under lender “duty of care” and consumer guidance, but you should assume that mortgage enforcement can disrupt even a well-run private tenancy.
Under the Renters’ Rights Act, foreclosure or repossession by a lender does not remove your obligations to comply with rental standards, protect the tenancy deposit, and avoid unlawful eviction or harassment while you remain the legal landlord. Professional landlords treat mortgage payments as a non-negotiable priority and communicate early with lenders and advisers if arrears arise, so they can avoid forced sale and the loss of control over how and when regaining possession happens.
Also see our landlord blog articles.
