UK Finance Lenders’ Handbook Changes: Early 2018 Update

Mortgage lenders began 2018 with a significant number of changes to their lender-specific conveyancing instructions.

During the first three weeks of January 2018, eleven lenders updated their Part 2 requirements under the UK Finance Mortgage Lenders’ Handbook. Collectively, the changes affected 26 Handbook sections.

Which lenders changed their Part 2 requirements?

Major lenders making changes during the opening weeks of 2018 included:

• Halifax;
• Bank of Scotland;
• Lloyds Bank;
• Santander;
• The Mortgage Business; and
• Atom Bank.

The changes did not necessarily mean that every lender had adopted a more restrictive position. An amendment might alter a reporting obligation, documentary requirement, contact route, acceptance criterion or administrative process.

Why historical lender requirements matter

This 2018 update illustrates a wider point: mortgage lender instructions change over time. The wording shown in the current Handbook may not be the wording that applied when an earlier purchase, remortgage or transfer of equity completed.

That distinction can become important when investigating:

• a complaint about an earlier conveyancing transaction;
• a professional negligence allegation;
• a lender claim or professional indemnity notification;
• a title or lease problem discovered during a later sale; or
• whether a particular matter should have been reported to the lender.

A current Handbook entry should not automatically be used to assess work undertaken in 2018. The original mortgage offer, special conditions, conveyancing file and lender instructions applying at the relevant time may all need to be considered.

Checking Bank of Scotland and Halifax requirements

The separate lender identities also matter. Halifax and Bank of Scotland should not automatically be treated as a single historical lender record merely because of their wider corporate relationship.

Where the transaction documents name Bank of Scotland, our Bank of Scotland Lender Handbook Archive guide explains how to check the lender’s recorded requirements for transactions falling within the available archive period.

For Halifax transactions, see our separate guide to historical Halifax mortgage requirements.

These archive guides do not necessarily provide records extending back to every lender change mentioned in this January 2018 article. Their purpose is to help users identify the lender, relevant date and available historical coverage.

Monitoring current Handbook changes

For live conveyancing matters, firms need a process for identifying new and amended lender requirements before giving the certificate of title or completing the transaction.

The LENDERmonitor alert service notifies conveyancers when selected lenders change their requirements. This can support lender-instruction controls, continuing competence and a firm’s CQS procedures.

Monitoring an update is only the first step. Firms should also consider whether the change affects:

• current transaction files;
• standard checklists and workflows;
• reports on title;
• supervision and training requirements; or
• the firm’s lender and mortgage fraud policies.

Historical record or current instruction?

This article remains useful as a contemporary record of lender activity at the beginning of 2018. It is not a substitute for the lender instructions applying to a particular transaction.

For a current transaction, check the lender’s current requirements, mortgage offer and any separate instructions. For an earlier transaction, identify the lender named in the documents and establish what instructions were applicable on the relevant date.

This article provides general information and is not legal advice. About Conveyancing and Lexsure are independent of UK Finance and the lenders mentioned.