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Application Declaration for a change to my mortgage

This declaration is for:
• A Digital product transfer
By clicking “confirm” I confirm that I make the following statements
I declare that
This application is made on the security of the property described in my application.
The mortgaged property is not Buy to Let and there is no Consent to Let on my current mortgage.
I authorise you to
Make any enquiries of any third parties for reference purposes and for the third party to disclose any information to you.
I agree that
I will notify you of any changes in circumstances relating to my application before the transaction it relates to is entered
into.
You may share the information about me and my application with HM Revenue and Customs “HMRC”. This will help
you to validate whether the income details provided to you are accurate. HMRC may also use the information for its own
risk profiling activities and to establish any mismatch with declared income.
I understand that
On completion of this mortgage, it will be regulated by the Financial Conduct Authority (FCA).
If any up-front fee(s) that I am asked to pay to you is described in my mortgage Offer as being non-refundable, this
means that if I do not proceed with the application for any reason, or if you reject my application for a valid reason, I will
be unable to recover the fee. Examples of why you might refuse my application include, but are not limited to:
• where it is discovered that I or any joint applicant have provided false or incomplete information;
• where you have a reasonable suspicion of fraud and/or other forms of financial crime.
I also understand that you may reject my application at any time at your absolute discretion. However, if you choose to
rely on this right, I will be able to recover the up-front fees which I have paid to you.
The payment of any fees shall not mean that you have to make me an offer.
When considering an application you may use the information supplied to you to offer additional products. If I do not
wish to receive this information I will advise my local branch or visit your website for details of how to opt out of this
service.

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Data Privacy Notice
My information will be held by TSB Bank plc.
My personal information will be shared within your Group so that you and any other companies in your Group can look
after my relationship with you. By sharing this information it enables you to better understand my needs, run my
accounts, and provide products in the efficient way that I expect.
Your Group includes you, your holding company and any subsidiary of you or your holding company from time to time.
More information on your Group can be found at www.tsb.co.uk/privacy.
You may obtain information about me from credit reference agencies, fraud prevention agencies, and Group records to
check my credit status and identity. The agencies will record your enquiries which may be seen by other companies
who make their own credit enquiries. This may affect my ability to obtain credit elsewhere in the near future. You may
also use credit scoring.
My application will be assessed using credit reference agency records relating to me and anyone with whom I have a
joint account or similar financial association. If this is a joint application and such a link does not already exist then one
may be created now. These links will remain until I successfully apply for a "notice of disassociation" at the credit
reference agencies.
If I am providing information on behalf of a joint applicant, by continuing with this application I confirm that I have their
permission to do so and they have agreed that you are authorised to search, link and record information about them at
credit reference agencies.
You will check and share my personal information from my application with fraud prevention agencies. If false or
inaccurate information is provided and fraud is identified, details of this fraud will be passed to these agencies to prevent
fraud and money laundering. Further details explaining how information held by the fraud prevention agencies may be
used can be obtained by reading the Privacy Statement at www.tsb.co.uk/privacy or contacting my local branch.
You may ask me to provide physical forms of identity verification when I open my account. Alternatively, you may search
credit reference agency files in assessing my application. The agency also gives you other details and information from
the Electoral Register to verify my identity. The agency keeps a record of your search, whether or not my application
proceeds. Your search is not seen or used by lenders to assess my ability to obtain credit.
You may use my information to contact me by mail, telephone, email or text message about products and services
available from your Group and from selected companies outside your Group that may be of interest to me. If I do not
wish to receive this information I will advise my local branch or visit your website for details of how to opt out of this
service.
It is important that I understand how the personal information I give you will be used. Therefore, you strongly advise that
I read your Privacy Statement, which I can find at www.tsb.co.uk/privacy or I can ask you for a copy. By continuing with
this application, I agree to my personal information being used in the ways you describe in your Privacy Statement. I will
let you know if I have any questions about the use of my personal information.
If I submit an application, I agree that you can use my information in the ways described.
YOUR PROPERTY MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE
Mortgage Conditions
I understand that the mortgage will be governed by the TSB Mortgage Conditions 2013 (the ‘current conditions’). For this
application I will be required to download and read a copy of the current conditions. These can be viewed online and
downloaded from https://www.tsb.co.uk/tsb_Mortgage_Conditions_2013.pdf and are included at the foot of this
document. We recommend that you save a copy of these for your records.
➢ Where my mortgage is currently governed by older mortgage conditions and, where relevant, loan conditions
(the ‘old conditions’), I agree to the current conditions being substituted for the old conditions on completion of
the transaction. I also agree that, if you ask me to, I will enter into a deed which formally records the substitution
of the current conditions for the old conditions.
I also understand that on completion of the transaction my existing mortgage will be subject to your current polices which
will substitute any existing policies on my mortgage account. A summary of the main policies is set out below:-
What happens if I move house?
If my existing mortgage allows me to take the terms of the mortgage with me if I move house, then this will change
following completion of the transaction so that I will only be able to take the terms of the initial product(s) (for example a
fixed or tracker rate) with me and those terms will continue for the remainder of the initial product period(s).

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If I wish to take the terms of my initial product(s) with me, I understand that whether or not you will offer me a new
mortgage will be based on your lending criteria at that time. I further understand that any decision will be subject to an
understanding of my needs and circumstances. The new mortgage will be subject to any conditions you set out in it and
my existing mortgage must be repaid and the new mortgage taken out on the same day.
What happens if I want to make overpayments?
As with my existing mortgage, I will be free to make lump sum or regular overpayments at any time, subject to the
payment of any early repayment charge that may apply. You currently have a concession where I can make
overpayments of up to 10% of the outstanding balance each calendar year (as at 1 January) without having to pay any
early repayment charge. This concession will continue to apply for the time being; however, you have the right to
change or withdraw it.
What happens if you want to make underpayments?
I will be able to pay less than my normal monthly payment for one or more months or miss one or more monthly
payments provided that I have previously made overpayments. I can only do this if the amount of the underpayments
does not exceed the amount of my previous overpayments less any amount I have previously underpaid. However, if
there has been a change to my monthly payment and/or mortgage term which took the previous overpayments into
account, then those overpayments will no longer be available for making underpayments.
What happens if you want a payment holiday?
I can make a request to suspend payment of all or part of my monthly payment for one or more months provided that I
meet the policy criteria in force at the time of my request.

Ian Ramsden
Mortgages Director

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MORTGAGES

TSB Mortgage
Conditions 2013

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TSB Mortgage Conditions 2013 – Please read!
We know that having to read a legal contract can be off putting, so we’ve decided to do things differently. This booklet contains:
• A brief explanation of what makes up our agreement with you for your mortgage loan.
• A list of what the main points in the Chapters of this booklet cover: this will give you a general awareness of where
you will find particular information in this booklet.
• Our Mortgage Conditions: this part of the booklet consists of short and simple Chapters giving you details of how your
mortgage loan will work.
• For properties in Scotland: the standard conditions, which apply by law. Our Mortgage Conditions apply over the
standard conditions if there is a conflict.

YOUR PROPERTY MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE

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Where you can find the details Main points covered Read more
about this
Early repayment • You can pay off everything you owe before the end of your mortgage term or Chapters 5, 6,
This is a list of the main points covered by the Chapters in this booklet, to help and underpayments pay off part of it early. If you do so, you may have to pay an early 14 and 15
you work out where you might find different things. To keep the list short, it repayment charge.
does not list everything, or summarise the booklet or go into the details (for • In some circumstances (normally where you break our agreement) we may
require you to pay off everything you owe before the end of your mortgage
which you need to read the Chapters themselves). term. If so, you may have to pay an early repayment charge, and there are a
number of steps we can take, such as taking possession of your property and
Main points covered Read more selling or renting it out to help pay what you owe.
about this • If you pay off part of what you owe early, we will use your payment
in a particular way unless (after paying off any early repayment
What, when and • You must pay everything you owe by the end of your “mortgage term”. Chapters 1, 2
charge and overdue amounts) you’ve asked otherwise.
how you will repay ––This includes having to repay your loan, pay any costs and charges that and 3
become due, and typically pay interest on all of them. • If you do not make a monthly payment in full, we will use your
––If you have a “repayment mortgage”, you will make monthly underpayment in a particular way.
payments set at a level to cover everything you owe by the end of Insurance • You must make sure your property is insured and (where you arrange the Chapter 7
your mortgage term. insurance yourself) pay the property insurance premiums on time.
––If instead you have an “interest-only mortgage”, your monthly payments • We can insure your property (at your expense) if you do not insure it.
will cover just the interest you owe, and you will have to pay everything
Our rights and how • Where we can make changes to our agreement, there are specific Chapters 8, 15,
else in one go at the end of your mortgage term. 16, 17 and 18
we may use them protections as to how and why we can make those changes. Otherwise, as
––We also tell you what we can do if we are not satisfied that your
a general rule, we will act reasonably when using rights in our agreement.
arrangements to repay everything you owe at the end of your mortgage
• We may transfer some or all of our rights in the mortgage and our
term are sufficient.
agreement to someone else.
––You may need to pay certain charges separately to everything else.
• In some circumstances we may have a right to take possession of your
What is in your • This booklet needs to be read alongside your offer letter. The offer letter Chapters 1, 2, property, enter your property or ask others to enter your property to take
offer letter will give you information about, among other things, your mortgage term; 3 and 18 certain action.
whether you have a “repayment mortgage” or • We will be your “attorney”, which allows us to do various things in your
“interest-only mortgage”; which interest rate (or rates) you have; the name for our benefit. If we appoint a receiver, he will act on your behalf and
amounts of your monthly payments; and certain charges you have agreed will also be your attorney.
to up front (other charges and costs may become payable
Things you have • We lend you money on the basis that you pay us what you should and Chapters
later on). 9 and 13 in
to do repay everything you owe when you should, and do the other things you
• If there is a conflict between different parts of our agreement we tell you particular
agree to under our agreement.
in Chapter 18 which part of our agreement you should look at to be sure
• That includes using your property as your main residence (unless we agree
of the position.
otherwise) and keeping it in good repair and getting our permission before
How our agreement • Our agreement can last for a long time, and so we are likely to Chapters 1, 2, you do certain things, for example letting your property, altering or adding to
can change change the level of our interest rates, charges and costs in the future. 3, 11 and 12 it or changing its use.
We may also change other aspects of our agreement, including things in • If you do not do what you should when you should, we may do it instead
your offer letter. and you will have to pay for that. Remember – this means you will be
• We explain in Chapter 11 how we will let you know when we make breaking our agreement.
changes to our agreement.
Our security • You give us the mortgage on your property as security for the amounts we Chapter 10
Interest you pay • We will work out your interest on a daily basis. This broadly means Chapters 2 lend you and everything else you owe us under our agreement.
we look at everything you owe each day and calculate a day’s worth and 13 • It also covers any money you owe us under certain other mortgage
of interest on it. We will charge you each month’s worth of interest by agreements you have (or had) with us or might have with us in the future;
adding it to your loan at the end of the month. and under a mortgage loan we have made to you jointly with someone else.
• We have different types of fixed and variable interest rates that can apply • We can keep the mortgage as security until you have paid us in full
to your loan. everything you owe under our agreement and under the other agreements
Where there • Different parts of your loan can be on a different basis, for example Chapters 4 and mortgage loans it covers.
are different one part of your loan can have a different interest rate to another part. and 6 Properties in • For properties in Scotland, the law states that there are certain standard Chapter 18 and
parts to your • This means that some Chapters in this booklet can apply differently to Scotland conditions which apply to mortgage loans. the Standard
mortgage loan different parts of your loan. • If there is a conflict between different parts of our agreement we tell you in Conditions
Chapter 18 which part of our agreement you should look at to be sure of (at the end of
the position. this booklet).

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What makes up our
agreement for your
mortgage loan?
If you have a mortgage loan with us, we will give you a loan and you will give us a mortgage
over your property (which we call “the mortgage”). The “mortgage” is a form of security for
repayment of your loan and for payment of other things to do with your loan.

What is your “loan”?

Your “loan” is the total of the money we lend you at the start of our agreement plus any money
we lend you at other times under our agreement. It does not include interest, charges or costs.

What is “our agreement” for your mortgage loan made up of?

• This booklet.
• Any offer letter we give you for your mortgage loan. We will give you an offer
letter before we first give you your loan, and we may give you further offer letters
later on if we agree to changes to our agreement.
• The mortgage deed. This covers the mortgage security we take over your property.
By the way, for properties in Scotland it is called a “standard security”, but to
keep things simple, when we talk about a “mortgage deed” in our agreement we
will also mean the standard security.
• Any other agreement you make with us to do with your mortgage loan, for
example, where we agree to a change to the time period in which you must repay
what you owe, without giving you a new offer letter.
Our agreement will last until you have paid us everything you owe under our
agreement and we no longer have the mortgage over your property.
We have tried to keep our agreement simple, but for the more complex areas you can
ask your solicitor or licensed conveyancer to explain anything you do not understand.

Who is our agreement between?

• us, TSB Bank plc (Registered in Scotland no. SC095237); and
• you, the person (or persons) named in the mortgage deed as “the borrower” (or “the
debtor” if your property is in Scotland).
If more than one of you is borrowing from us, our agreement applies to all of you
together and to each of you on your own. This means that we can, for example,
require just one of you to make the payments due under our agreement, or require
some or all of you to make the payments together.

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 Chapter 1 – What, when and how will you pay?
Our mortgage conditions
This Chapter gives you an overview of what you will have to pay
(or may have to pay) under our agreement. It then covers details about
your monthly payments, such as what they will be and when and how you
Getting started should make them as well as how this may differ for “repayment
mortgages” and “interest-only mortgages”. It also tells you when we can
Chapter 1: What, when and how will you pay? 3
change your monthly payment. If you have an “interest-only mortgage”,
Chapter 2: The interest you pay 7
this Chapter tells you what we can do if we have concerns about your
Chapter 3: Our charges and our costs 13 ability to pay off everything you owe at the end of your mortgage term.
Chapter 4: Where different parts of your mortgage
loan are on a different basis 18 What will you pay?
Chapter 5: Early repayment 19 You will have to pay us back your loan, and pay us interest on it until you do.

Chapter 6: How we apply overpayments and underpayments 20 You might also have to pay us:

Chapter 7: Insuring your property 22 • some charges and costs; and

Chapter 8: Our rights and how we may use them 25 • interest on any interest, charges and costs that you owe and have not yet paid.
Chapter 9: What you have to do and what you In this booklet, we refer to the total of your loan, costs, charges and interest as “everything
have to ask our permission to do 27 you owe” and, where we are looking at everything you owe at a particular time, as “what
you owe”. You must pay us everything you owe by the end of your mortgage term.
Chapter 10: Our security and what it covers 30
Chapter 11: Contacting you 31
What is your “mortgage term”?
Here, “term” means “period of time”, and your mortgage term is how long you
have to pay everything you owe.
What else can we do? Your mortgage term will be the period of time you agree to, usually in your
offer letter, unless your mortgage loan ends early or we extend it.
Chapter 12: Changes to our agreement 33
Chapter 13: Letting your property or changing its use 34
We will agree with you, usually in your offer letter, whether you have a “repayment
Chapter 14: When you need to repay immediately 35 mortgage” or an “interest-only mortgage” (or both), what your monthly payments are,
Chapter 15: Our right to take possession of your property or and the interest rate (or rates) and any charges that you have to pay.
deal with it in other ways 37 There might be further costs that you have to pay, which will be explained in Chapter
Chapter 16: Acting on your behalf 40 3 and at points throughout this booklet.

Chapter 17: Our right to transfer our rights in the mortgage Our agreement can last for a long time, and so the levels of our interest rates, charges
and our agreement 44 and costs, and your monthly payments, are likely to change in the future. Chapters 2
and 3 (and this Chapter) give details of how and when they can change.
Chapter 18: Other conditions 45

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 Your monthly payment amounts As an exception to this, if the next working day would be in the next month, you will
For “repayment mortgages” you will have to make monthly payments. We will work out instead make your payment on the previous working day.
the level of your monthly payment amounts so that everything you owe is repaid with
interest by the end of your mortgage term. For example
For “interest-only mortgages” you will have to make monthly payments at a level Say your monthly payment day is the 28th, and in February that falls on a
that pays the interest only, and make a lump sum payment at the end of your Saturday, you will have to make your payment on Friday 27th February because
mortgage term to pay off everything else you owe, including repaying your loan. the next Monday would be in March.

We calculate your monthly payments so that they will all be for the same amount. This also
applies if, as we explain below, we later change the monthly payment amount. When we work out
the interest collected by a monthly payment, we will treat each full month as an equal twelfth part
Temporary stop or reduction to monthly payments
of the year. This means we will usually collect slightly less interest than you owe in months that We may choose to allow you, temporarily, to stop making your monthly payments
are 31 days long, and slightly more than you owe in the other months. or to pay lower monthly payment amounts. We may do this if, for example, you
have trouble meeting your payments.
As an exception, we may set your first monthly payment after we give you your loan
at a higher amount. This is because your first monthly payment may be in the month If so, we can later do one or more of the following things.
after we give you your loan, so we may add the interest from the first month of your • Start your monthly payments again.
loan on top of your first monthly payment.
• Extend your mortgage term, if we reasonably think you need more time to make
your payments. This means that (unless our agreement ends early) you will need to
For example make monthly payments for a longer period into the future, which means you will
Someone takes a new loan on 10th June. We work out that the interest on their loan from end up paying more for your loan.
10th to 30th June is £250, and that their usual monthly payment amount will be £1,000.
• Increase your monthly payment amounts.
Their first monthly payment is in July, and will be £1,000 + £250 = £1,250.
If you have a repayment mortgage, and we increase your monthly payments, we will work out the
Then in August and each month after that, their monthly payment will be £1,000. new amounts to be enough to pay off everything you owe by the end of your mortgage term.

If you have an interest-only mortgage, and we increase your monthly payments, we will
We will tell you your monthly payment amounts after giving you a loan. work out the new amounts to cover the interest on what you owe.
• The overall amount you owe will have increased because of you having stopped making
When and how to make your monthly payments (or having reduced) your monthly payments.
You will have to make your monthly payments until you have paid off everything you owe. You
must make them on the 1st day of each month unless you choose a different day (for example, • You must make sure that your arrangements to repay everything you owe at the
the 15th day of each month) and you must do so by direct debit. You cannot choose a day later end of your mortgage term cover the increase in the overall amount you owe.
than the 28th day. Once you have chosen a day, you will need our agreement to change it. We will tell you before we start your monthly payments again, increase them, or extend
Weekends or public holidays your mortgage term. This gives you an opportunity to contact us if you would like to
We will only ask you to make your monthly payments on working days (as opposed to discuss what we are doing.
weekends and public holidays). Please note that we can also take other steps and other things can happen, as
So, if one of your monthly payment days would fall on a weekend or public described in Chapters 14 to 16.
holiday, you will instead make the monthly payment on the next working day.

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 Your arrangements to pay off everything you owe, if you Chapter 2 – The interest you pay
have an interest-only mortgage
We can ask you to show us what arrangements you have made to pay everything You will have to pay us interest on what you owe. There are
you owe by the end of your mortgage term. different types of interest rate and in this Chapter we explain how
If we are reasonably concerned that those arrangements may not be sufficient, we each of them works, but your offer letter will tell you what type or
will make a reasonable effort to contact you to discuss how you can put that right. If types apply to your loan. This Chapter also explains when we will
we cannot get hold of you, or are not reasonably satisfied with how our discussions charge interest, how we work out how much interest you have to
go, we may do one or both of the following.
pay and how we may change an interest rate.
• Switch some or all of what you owe from an interest-only mortgage to a repayment
mortgage. This means you will have to pay monthly payments set at higher levels to What we charge interest on
pay off everything you owe (including your loan) by the end of your mortgage term. We charge interest on everything you owe (until you have paid it off) unless we tell
• Extend your mortgage term, if we reasonably think you need more time to make you we are not charging interest on something. We charge you interest for every day
your payments. This means that (unless our agreement ends early) you will need to you owe us anything under our agreement.
make monthly payments for a longer period into the future, which means you will We start charging interest:
end up paying more for your loan.
• on any money we lend you from the day we lend it to you;
We will give you notice before we do this.
• on interest from the day after we add it to your loan; and
When we can change your monthly payments • on any charges and costs in the way we explain in Chapter 3 (in the section called
Sometimes, we may need to adjust your monthly payment amounts so that they can “When and how to pay our charges and costs”).
continue to be at the level described under the heading “Your monthly payment
If you make a payment, it will reduce what you owe (and so what we charge interest on)
amounts” near the start of this Chapter.
from the day we actually receive the money.
We may do this if for example:
• your interest rate changes; How we work out interest
For each month, we look at what you owe at the very start of the month, and then at anything we
• we change how we work out interest; add to what you owe (such as a charge) or that you pay off (say through a monthly payment)
• you have to pay a new charge or cost; during that month. We then calculate your interest for the month as follows.

• you make an overpayment; • (what you owe at start of month) × (yearly interest rate) × (days in the month)

• you are late making a payment or only pay part of it; PLUS
• (any added amount) × (yearly interest rate) × (remaining days in month,
• we lend you more money;
including day of addition)
• there is a change to your mortgage term;
MINUS
• we have allowed a temporary stop or reduction to your monthly payments; or • (any payment) × (yearly interest rate) × (remaining days in month,
including day of your payment)
• you switch to or from an interest-only mortgage.
We then divide that total figure by 365 (366 in a leap year). We perform our
We will give you notice when we change your monthly payments.
calculation to four decimal places at each step and then round up the result to the
nearest penny to give you your interest charge for the month.

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 When do we add interest?
For example
We will add the interest for each month to what you owe at the end of the last day of
Someone owes £100,000 at the start of 1st June, and on 16th June they make a that month. We then start charging you interest on that interest (often called ‘compound
payment of £20,000. Their yearly interest rate is 6%. On that basis, we work out interest’) from the first day of the next month.
their interest for June as follows.
£100,000 × 6% × 30 (being the number of days in June) = £180,000.0000 What type of interest rate do you have?
We will agree with you:
£20,000 × 6% × 15 (being the number of days from 16th to 30th June) = £18,000.0000
• whether your interest rate is fixed or variable;
£180,000.0000 – £18,000.0000 = £162,000.0000
• when an interest rate will end, if it is only for part of your mortgage term; and
£162,000.0000 ÷ 365 = £443.8356
• whether you pay different rates on different parts of your loan.
Total Interest charge for June = £443.84
We will usually agree terms about your interest rate in your offer letter, and that is
what we assume when we refer to your offer letter in the rest of this Chapter.

Sometimes we may change an interest rate at a point during a month. (For details of when we
might do this see later in this Chapter under the headings “When can we change a lender For example
variable rate?”, “Tracker rates” and “Added rate”.) If we do change the rate after the beginning of Someone’s offer letter may say that they will pay:
the month we will work out the interest in the same way as set out above but we will use the • a fixed rate which ends on a certain date or after a certain period of time;
original rate up until the date of the rate change, and use the new rate for the rest of the month.
• a variable rate which ends on a certain date or after a certain period of time; or

For example • a mixture of these.

Someone owes £100,000 at the start of 1st June. Their yearly interest rate is
initially 6% but on 10th June the rate is changed to 6.25%. On that basis, we work
out their interest for June as follows. What happens when your fixed or variable rate ends?
Your offer letter will say how long your fixed or variable rate will last for and what will
£100,000 × 6% × 9
replace it (usually a lender variable rate) when it ends.
(being the number of days in June
that the interest rate was 6%) = £54,000.0000
Fixed rates
£100,000 × 6.25% × 21
(being the number of days in June What is a fixed rate?
that the interest rate was 6.25%) = £131,250.0000 A fixed rate is an interest rate that does not go up or down – the interest rate
£54,000.0000 + £131,250.0000 = £185,250.0000 remains the same for the period of time that it is fixed.

£185,250.0000 ÷ 365 = £507.5342

Total Interest charge for June = £507.53 Variable rates

What is a variable rate?

A variable rate is an interest rate that can change. A variable rate can go up and down.

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 There are different types of variable rate, for example lender variable, tracker and capped rates. Discounted rate
You can read more about different types of variable rate and how they can change below.

What is a discounted rate?

Lender variable rates
This is where your interest rate is set at a particular level (discount) below a
lender variable rate. The rate you will pay is the lender variable rate that applies
What is a lender variable rate? to your loan less the discount.
A lender variable rate is a variable interest rate which we set and can decide to change.

We can charge different lender variable rates for different customers or different types of
For example
loan. We may even charge different lender variable rates on different parts of the same
Say you have a discount of 2% off a lender variable rate and that lender variable
loan. Your offer letter will say if one or more lender variable rates are to apply to your loan.
rate is 6%, the interest rate you will pay is 4%. If we increase that lender variable
rate to 7%, your interest rate would become 5%.
When can we change a lender variable rate?
We can change a lender variable rate at any time, after giving you notice that we’re going to do so.
We can reduce the rate for any reason, but we will only increase it in the following situations. Your offer letter will say if you are to have a discounted rate, the level of the discount and
how long it lasts. We will not change the level of the discount. However, if the discount
• Change to our cost of lending: We have costs in raising the money lent to our
means that your interest rate would fall below zero, your interest rate will be 0% instead.
“residential mortgage” customers. If those costs change, or we know they are about to
change, we can change a lender variable rate in proportion to the change in costs.
Tracker rates
• Change to laws and regulations: We of course follow laws and regulations (see
Chapter 18 for an explanation of what we mean by “laws and regulations”). These What is a tracker rate?
might change, or we might know that they are about to change. A tracker rate is where your interest rate follows another rate which is not set by
–– If the change in laws and regulations means we should change a lender us. It will track that other rate by a “margin”.
variable rate, we will do so.
–– If there is a change to our cost of following laws and regulations, as a result of a change to If the rate being tracked changes, we will also change your rate within 30 days to
them, we can also change a lender variable rate in proportion to the change in cost. keep to the margin and we will give you notice before we do so. The 30 days will start
Sometimes those reasons may allow us to change one lender variable rate at a from the date of the official publication of the change in rate.
different time or by a different amount from another lender variable rate.

For example
What is a “residential mortgage”? Say your interest rate tracks Bank of England base rate by a margin of +2% then, when
This is where we take a mortgage over a property that is used as someone’s the base rate is 2%, your interest rate would be 4%. If a base rate increase to 3% is
home, or intended to be used as a home. It could be either the customer’s home or published on, say, 1st June, then we will raise your interest rate to 5% before 1st July.
someone else’s, for example someone the customer let the property to.

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 We may charge you one or more added rates if:
What is Bank of England base rate? • you agree to it in your offer letter; or
This is the official Bank of England Bank Rate, which people commonly call “base rate”.
• an added rate becomes payable for the reasons in Chapter 13 under the heading
“Extra interest or regular additional payments” (which can apply if you let your
Your offer letter will say if you are to have a tracker rate, what your margin is, what rate property or change its use without our permission).
it tracks and how long it lasts. The margin could be positive (for example, base rate
We can reduce or stop charging an added rate at any time. We can also increase an
+2%), negative (for example, base rate -1%) or even zero (if, for example, your interest
added rate for the same reasons as we can increase a lender variable rate (see above).
rate is set at the same level as the base rate).
We will not, however, increase an added rate as a result of a change to our cost of
We will not change the margin. However, if the margin means that your interest rate lending or our cost of following laws and regulations, if we have already increased
would fall below zero, your interest rate will be 0% instead. another rate that applies to the same part of what you owe for the same reason.
Sometimes those reasons may allow us to increase the added rate at a different
Capped rate
time or by a different amount from a change to a lender variable rate.

What is a capped rate? We will give you notice before we change an added rate.
This is where an interest rate that is variable (which means it can go up
or down) cannot go above a particular level. That level is the “cap”, and is
sometimes also called the “ceiling”. Chapter 3 – Our charges and our costs
Your offer letter will say if you are to have a capped rate, what the cap is and how long it lasts.
In addition to paying us interest you will sometimes have to pay charges
We will not charge you interest above that cap for as long as the cap lasts. and costs in relation to the mortgage, your property or our agreement. This
Chapter explains what these charges and costs may be, how we work
For example them out, when and how we will pass them on to you and when we charge
Say you are paying interest at a variable rate, which is currently at 3.5%, and you interest on them. It also covers when we may change our costs.
have the benefit of a cap set at 4.5%.
As well as paying us interest on your loan, you may have to pay us charges and costs.
The variable rate then increases to 5%. The interest rate you pay would increase
to the cap at 4.5%. If the variable rate then goes down, to say 4%, the interest rate What are our “charges”?
you pay would become 4%. Our charges relating to our agreement are any:
• charges at the start of our agreement as described in your offer letter, for example a
“product fee”;
Added rate
• early repayment charges (see Chapter 5);
What is an added rate? • other charges you have to pay when you repay part, or all, of everything you owe,
This is where we charge an additional interest rate on top of a fixed or variable including at the end of your mortgage term;
rate (or rates) that you must pay on your loan. • regular additional payments described in Chapter 13 (under the heading “Extra
interest or regular additional payments”);
• charges for us to agree to additional borrowing or new services;

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 • charges for where you agree to us making a change to our agreement (for example, How we set our standard costs
changing the type of rate you pay, or a borrower, or your mortgage term). We work out each of our standard costs to be a reasonable amount, as follows.
Chapter 13 tells you how we may charge any regular additional payments. Otherwise, we’ll tell
• Each will be for all our costs for the activity, including both our own internal costs
you of any charges in advance, so that you’ll have agreed to them before they become payable. and costs we pay to other people. We will make a reasonable estimate of the
expected average costs, and set the fee at the level of that average.
What are our “costs”?
• As well as costs specific to the standard cost, our estimate can include, for
Our costs are what you pay us for our expenses to do with the mortgage, your
example, a reasonable share of our costs in having and using resources (such
property or our agreement, apart from:
as offices, staff and computer systems) that we also use for other purposes.
• our normal expenses for servicing our residential mortgages in general where our customers
If our costs (whether internal or paid to other people) change, we can change our
are keeping to their agreements with us, as we have already taken those expenses into
standard costs as described below.
account when setting our interest rates and the charges we mention above; or

• other expenses included in the charges we mention above. How we can change our standard costs
Our costs might come about because of something you ask for or because you do not We can reduce or cancel a standard cost at any time for any reason. We can also increase a
keep to your obligations under our agreement. standard cost or bring in a new one at any time, but only in the following situations.

You will only have to pay for a cost of ours so far as the cost is reasonable. Change to our costs: If our costs change, or we know they are about to
change, we can change our standard cost in proportion to the change.
What costs will you have to pay extra for? New or increased standard costs: If we have been giving you something for free or
It would not be possible to list every type of cost, but some common examples are: we bring in something new, we can start charging a standard cost for it. Similarly, we
• the costs of taking legal or other action if you break our agreement or if there is a can increase our standard costs if we have not been fully passing on our costs.
dispute to do with the mortgage, your property or our agreement; Change to laws and regulations: We of course follow laws and regulations (see
• the costs of us having to make payments to other people because you have not met Chapter 18 for an explanation of what we mean by “laws and regulations”). These
your obligations to do with your property, for example, if we pay a service charge might change, or we might know that they are about to change.
where you have failed to do so; and • If the change in laws and regulations means we should change our standard
• the costs of taking steps such as inspecting, valuing or insuring your property, where our costs, or the levels of our standard costs, we will do so.
agreement allows us to take those steps. (Chapters 12 to 18, headed “What else can we • If there is a change to our cost of following laws and regulations, as a result of a
do?”, set out in more detail the types of action we can take and when we can take it.) change to them, we can also change our standard cost (including bringing in new
standard costs) in proportion to the change in our cost.
Our standard costs
If we change the level of a standard cost or bring in a new standard cost, we will give
In many cases our costs will be standard costs (but not all of them, as we you notice before it becomes payable.
explain later in this Chapter).
We will give you information about our standard costs and regular updates of any Where we do not have a standard cost
additions or changes to them. If a standard cost is not covered by our latest Where we do not have a standard cost, we will simply charge you a reasonable amount
information (or has since changed) we will tell you before you have to pay the cost. to cover our internal costs and any costs we pay to other people.

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 What happens if we add a charge or cost to your loan?
For example If we add a charge or cost to your loan then, unless we tell you otherwise, we will
Suppose you have a lease for your property and we end up having to pay the charge interest on it.
ground rent and service charges because you have not. We will charge interest:
• If we do have a standard cost to cover our internal costs of dealing • on a charge, from when we add it to your loan; and
with those payments, you will have to pay this.
• on a cost, from the beginning of the second month after we add the cost to your loan.
• However, our standard cost will not cover the amounts of the ground rent and (This allows you to avoid paying interest on a cost by making an additional payment
service charge themselves. This is because we cannot estimate in advance to pay it off before then.)
what we might end up having to pay. So, you will have to pay us what we pay
your landlord on top of any standard cost we may have.
For example
Say we add a cost to your loan on 8th January, we will not start charging
Taxes on our costs interest on the cost until 1st March.
If any tax is payable on our standard costs or other costs that we pass on to you, you
must also pay the tax unless we reasonably think that we can recover it in some other
You will have to pay interest on the charge or cost at the same interest rate as you
way. We will add the amount of tax to the cost that you have to pay.
pay on your loan, unless we have agreed otherwise (for example, in your offer letter).
You will also have to pay a charge or cost that we add to your loan on the same
For example
basis as you repay your loan, again unless we have agreed otherwise.
You may have to pay VAT or (if, say, we need to arrange buildings insurance)
insurance premium tax. This means that, when we next change your monthly payments, we will at the same
time change them so that:
• for a repayment mortgage, they pay off the charge or cost (and everything else you
When and how to pay our charges and costs
owe) by the end of your mortgage term; and
When must you pay a charge?
If you have to make regular additional payments under Chapter 13, we will tell you when • for an interest-only mortgage, they pay the extra interest on the charge or cost.
to pay them. Otherwise, a charge will be payable on the date you have agreed to pay it, You must make sure that your arrangements to repay everything you owe at the end of
whether in your offer letter or otherwise. your mortgage term also cover any charges and costs that are added to your loan.
If we agree to add a charge to your loan, we will add it on the date it becomes payable.
If we have not agreed to add it to your loan, you must pay it separately when it becomes payable What if your loan is in different parts?
– if you do not we can then add it to your loan. As we discuss in Chapter 4, different parts of your loan can have different
interest rates, mortgage terms or repayment methods.
When must you pay a cost?
We can add a cost to your loan on the date it becomes payable. We will tell you which part of your loan we add a charge or cost to.
• For a cost where we have to pay another person, it will be the date by which we If you repay that part before another part, we will add any remaining charges and
have paid that person. costs to a remaining part of your loan.
• For any other cost, it will be the date by which we have done the work covered by Unless we notify you otherwise you will have to pay each charge and cost (and interest
on it) on the same basis as the part of your loan we add it to.
the cost. We will tell you after we have added a cost to your loan.

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 Chapter 4 – Where different parts of your
For example
mortgage loan are on a different basis • If one part of someone’s loan is on a tracker rate and another part is on a lender
variable rate, different sections in Chapter 2 apply.
Your loan may be in different parts and different conditions may
apply to each part, so that the repayment method, the type of • If one part of someone’s loan is on one of our lender variable rates, and another
part is on another of our lender variable rates, we may change those rates at
interest rate or the mortgage term of one part of your loan may different times or, say, increase one by 0.5% and the other by only 0.25%.
be different to another part. This Chapter explains more about
• We may set and change your monthly payments separately for each part.
what it will mean for you if your loan does have different parts.
What different types of loan are there?
• A loan can have different types of repayment method. It can be an interest-only
mortgage or a repayment mortgage. Chapter 5 – Early repayment
• Different types of interest rate can apply, for example a loan can have a fixed or You may find you’re in a position to pay off some, or all, of what
tracker rate, or a lender variable rate.
you owe earlier than you originally agreed to (or you may have
• Different mortgage terms may be agreed, for example one loan may need to be to do so). If you do, you may have to pay us an extra charge. In
repaid within 15 years and another within 25 years.
this Chapter you can find out how early repayment will work and
Sometimes a single loan can be a mixture of these. when and how you may have to pay that charge.

For example Paying off what you owe early

A single loan for £250,000 could be made up of: At any time before the end of your mortgage term you can choose to make an early
repayment by either paying:
• one part, for £100,000, which has a fixed interest rate of 5%; and
• everything you owe early (for example, if you remortgage or sell your property); or
• the other part, for £150,000, which has a tracker rate of Bank of
England base rate +2%. • only part of what you owe early, by making a payment on top of your monthly payments.

Charge for early repayment

How does this affect you? You might or might not have to pay us an “early repayment charge”, depending on
We will give an indication, usually in offer letters, if your loan is in different parts. what you have agreed to (usually in your offer letter). If it is payable, we will deduct it
from the amount of your early repayment.
If your loan is in different parts, we may require you to:
• make a single monthly payment for all parts; For example
• make separate monthly payments for different parts; or Someone owes £100,000, and wishes to pay it off in full at a time when a
3% early repayment charge applies.
• make separate monthly payments to cover any costs or charges that you have to pay.
Here, the early repayment charge would be (3 ÷ 100) × £100,000 = £3,000.
Also, please remember when reading this booklet that things can apply differently to
different parts of your loan. The customer would therefore need to pay £100,000 + £3,000 = £103,000 to pay
off their mortgage loan in full.

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 Where you make an early repayment of only part of what you owe, and an early
repayment charge applies, we will ask you to pay an early repayment charge just For example
on that part (see the example in the next Chapter). Someone has a loan with us which has two parts. Let’s say their total monthly
payment is £400, of which:
Where the charge is payable, it will not only be payable where you choose to make
the early repayment, but also where you have to make the early repayment or we • £100 is the monthly payment on part 1
make it (Chapter 14 explains when that might be).
• £300 is the monthly payment on part 2
We may also ask you to pay an early repayment charge if you ask us to change
We calculate what percentage of their total monthly payment is made to each part:-
the type of interest rate (or rates) you are paying, and we agree to the change.
Payment on part 1 (£100)
Total monthly payment (£400) × 100 =25%
Chapter 6 – How we apply Payment on part 2 (£300)
overpayments and underpayments Total monthly payment (£400) × 100 =75%
Scenario A
There may be times when you choose to pay more, or you pay They make an overpayment of £100 (on top of their £400 monthly payment)
less, than your monthly payments. This Chapter explains how
We apply £25 of the overpayment to part 1.
we will use such payments when your loan is in different parts, (Overpayment of £100 × 25%= £25)
how they will affect your loan and how you have some choice as
We apply £75 of the overpayment to part 2.
to how an overpayment will be used.
(Overpayment of £100 × 75%= £75)
An “overpayment” is when you choose to pay more than your monthly payment.
Scenario B
An “underpayment” is where you pay less than you owe for your monthly payment. They make an overpayment of £100, and an early repayment charge of £3
In this Chapter 6, we explain how we will use an overpayment or an underpayment if is payable on part 2
your loan has more than one part (see Chapter 4). We apply £25 of the overpayment to part 1.
We will use any other money that we receive, that does not form part of your monthly (Overpayment of £100 × 25%= £25)
payment, in the same way. We use £3 of the overpayment to pay the early repayment charge
If you are choosing to make an overpayment, and want us to use it differently, you We apply £72 of the overpayment to part 2.
can ask ahead of making the payment. We will then use the overpayment as you (Overpayment of £100 × 75% = £75 minus £3 = £72)
wish, but only after we first use it to pay any early repayment charge and any
overdue amounts such as a missed monthly payment. Scenario C
They pay £300 instead of £400 for their monthly payment (an underpayment)
How we use underpayments and (unless you can and do tell us otherwise)
We apply £75 of the underpayment to part 1.
overpayments (Underpayment of £300 × 25%= £75)
We will use an underpayment or overpayment to pay towards each part of your loan in
the same proportions as we apply your full monthly payments to those parts. We apply £225 of the underpayment to part 2.
(Underpayment of £300 × 75%= £225)
In the case of an overpayment, we will only do this after first using the payment to pay
any early repayment charge. If you only have to pay an early repayment charge on
part of what you owe, we will pay the charge out of the payment towards that part.

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 Chapter 7 – Insuring your property When is a policy suitable?
You must have buildings insurance over your property as long as This normally requires the type and amount of insurance cover to be adequate
and for the level of any excess to be affordable if you need to make a claim. (The
you have the mortgage. This Chapter sets out what we expect that
excess is what you agree in the insurance policy to pay yourself if there is
insurance policy to cover and the things that you must do in relation damage to your property, before you can look to the insurer to cover you.)
to insurance before and after you take it out. We also explain how • For the type of cover, policies which cover “comprehensive householders’
we may step in if you do not do what we expect. If your property is in risks” would normally be adequate.
Northern Ireland, you can also read in this Chapter about how any • For the amount of cover, some policies have an unlimited amount of cover to
compensation payout you receive may have to be used. allow your property to be rebuilt if badly damaged, without needing to keep
checking that amount as prices for rebuilding change. Other policies have a
What you must do limit. If the policy has a limit, you will need to make sure that it will be enough to
You must make sure that there is buildings insurance in place for your property at all times. allow your property to be completely rebuilt if badly damaged.

What if you cannot insure?

What we can do
Sometimes you will not be able to insure your property yourself because someone We may insure our interest and/or your interest in your property if:
else has the legal right to insure. An example of that would be if your property is • you are not insuring it (and we are not reasonably satisfied that anybody else has insured it);
leasehold and the lease requires your landlord to insure it. In that case, you must do
• we reasonably believe the insurance is not suitable and you have not made it so if
all you reasonably can to make sure that your landlord insures it. we have asked; or
• we have asked you to provide details of the insurance and/or proof that it is still in
• You must show us details of the insurance policy and proof that it is still in force, if we ask you. If force and you have not done so.
we reasonably think that the cover is not suitable, you must improve the cover as we ask. If we insure your property, we will decide the following:
• You must claim under the policy for any damage (except minor damage) you are • who the insurer will be;
covered for unless you put the damage right yourself.
• what will be covered by the policy; and
What the buildings insurance policy must cover • the amount of the cover and any excess.
When you insure your property, the following terms will apply. We will keep any commission paid or allowed for any insurance we arrange.

• If the insurance company allows you to, you must have it insured in our joint The insurance we put in place will be to protect our interests. Our insurance may not
names, and if that is not possible you must arrange for our interest in your cover your interests or the interests of anyone else at all, or if any of your or anyone
property to be noted on the insurance policy. else’s interests are covered, they might only be partly covered.

• The policy must be suitable to cover your property so that if something happens to it,
the money from a claim will pay to allow it to be put back to how it was before. For example
Say your property has a value of £300,000, with a mortgage to us with £200,000
left to pay and a mortgage to another lender with £40,000 left to pay. If we insure
your property, we may insure it for £200,000 (plus some extra to cover any extra
interest, charges and costs) to cover our interests. This leaves your interests and
the interests of the other lender not insured.

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 You can at any time ask us to provide you with details of any insurance we have put Compensation Agency arrangements for properties in Northern Ireland
in place. It is down to you to decide whether that insurance is also suitable for you If your property is in Northern Ireland and the Compensation Agency
(and for anyone else who might have an interest in your property), and to arrange any agrees to pay compensation for any damage caused to your property:
additional insurance that you may need.
• you must hold the compensation that you get from the Compensation Agency on trust
If we insure your property we can add the cost to your loan and we can charge you for us, unless an insurer has also paid money under an insurance policy for the same
interest on it. damage, in which case you only need to hold on trust for us the part of the
Although we may insure your property, you must not rely on us to insure your compensation that is not going to be repaid to the insurer; and
property if you do not. • any money paid by the Compensation Agency must be used to repair or rebuild your
property, unless we give you notice that it is to be used instead to pay towards
Provisions that apply whoever insures your property everything you owe. We will not give you notice that the money is to be used in that
You must take reasonable steps to make sure that nothing happens which may harm way unless we reasonably consider that it will not put your property in good enough
the ability to make a claim under the insurance. repair for the value of your property to cover everything you owe.

For example
If you do not pay the insurance premiums or do not give the insurer all the Chapter 8 – Our rights and how we may use them
information they ask for, they might not have to pay out if you make a claim.
We need to have rights in certain situations to allow us to do
You must tell us straight away if any significant damage happens to your property
things, ask you to do things or make you stop doing something,
and you will need to make a claim. Where the insurance allows, we will have a right so that we can protect our interests. In this Chapter we explain
to negotiate with the insurer and settle a claim on reasonable terms. how we will act when using the rights that we have.
Any money from a claim must be used to repair or rebuild your property or for another purpose
What are our rights?
for which the claim payout was made, unless we give you notice that it is to be used to pay
towards everything you owe. We will not do that unless we reasonably consider that using the We have rights in our agreement which help us to protect our interests.
money to repair or rebuild your property or for the other purpose referred to above: Depending on the circumstances, we may choose whether or not to use a
right or which right to use. Our rights include:
• will not put your property in good enough repair for the value of your property
to cover everything you owe; or • not giving our permission or approval, where you need it before doing something (for
example if you want to rent out your property or use it for a different purpose. For the
• will not meet the other purpose(s) the payout was made for. things you need our permission to do see the section headed “When you must ask for
If you get any money from a claim under any buildings insurance for your property, you must hold it our permission” in Chapter 9);
all on “trust” for us (which broadly means holding it for our benefit) until it is used to repair or • making our permission or approval subject to conditions;
rebuild your property, for another purpose for which the claim payout was made or to pay towards
everything you owe. You must do this whether or not we agreed to the insurance. • requiring that certain things be to our satisfaction or acceptable to us or that
documents be in our preferred form;
• requiring you to take or not to take certain action; or
• taking other action under our agreement.

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 How will we use those rights? Chapter 9 – What you have to do and what
We will act reasonably when we do use one of those rights.
you have to ask our permission to do
For example We expect you to do certain things to maintain the value of your property,
We will be acting reasonably if we use a right only as far as is needed to use your property in the way that you have agreed to and sometimes even
reduce the risk of: ask for our permission before you do something relating to your property.
• you not paying us what you owe on time; This Chapter gives you more details about this and how it will affect you.
• a negative impact to the mortgage over your property or to our ability to
What you must do in relation to your property
rely on or enforce that mortgage; or
You agree to the following.
• the mortgage and other security no longer being sufficient to cover everything
you owe, for example because of a fall in the value of your property. • You must use your property as your only or main home unless we agree otherwise.
• You must keep your property in good repair and condition.
However, this is not relevant (and does not apply) where we can change our agreement, as • You must carry out and complete any building or repair work
there are specific protections as to how and why we can make changes (which we explain
if: –– it is needed to keep your property in good repair; or
in more detail in Chapter 12, as well as the sections headed “When we can change your
monthly payments” in Chapter 1, “When can we change a lender variable rate?” in Chapter –– it is required by any laws and regulations that apply to the mortgage, your
2 and “How we can change our standard costs” in Chapter 3). property or our agreement.
This Chapter is about how we use our rights. It does not apply to what other people (for • You must make any payments relating to your property on time.
example a receiver) do, unless they are acting for us.
For example
What is “security”? You must pay any ground rent or service charges on time.
Security usually means rights you give us over things you own, to give us extra
cover in case you do not keep to your obligations under our agreement. • You must keep to any obligations you have relating to your property.
Please see Chapter 10 to find out more about “security”.
For example
If your property is freehold, you must keep to any restrictions and obligations
mentioned in the title (of ownership) to the property. For example, there might be a
restriction on the title that says you cannot keep caravans at the property or that
the property cannot be used for running a business.
If your property is leasehold, you must keep to the terms of the lease.

If you do not keep to any of your obligations relating to your property, we may keep
to them for you.

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 • You must tell us if you are going to become the owner of a new or increased When you must ask for our permission
interest in your property or in any land or building which includes your property. You must get our permission before you do any of the following things relating to the
whole of your property, or any part of it.
For example • Sell your property, give your property away or transfer the ownership of your
You might have a lease and then get the chance to buy the freehold or extend property in any other way. You do not need our permission if you pay off everything
the term of the lease. you owe before or at the time you do this.
• Give someone else security over your property, if we do not provide the whole of the
You must give us (if we ask for it) a new mortgage over the new or increased interest. amount your offer letter says you can borrow at the start of your mortgage term.

You must get our approval to the terms of any new mortgage deed, and we may • Let your property or change the terms of any lease. We may ask you to pay the rent
make our approval subject to conditions. towards everything you owe as a condition of giving our permission.

• If we ask you, you must give us, for us to hold, any document to do with your property or the You will not need further permission if any new letting or any change to the terms of a
ownership of your property, which you have or which is looked after by someone else for you. lease is still covered by any permission we have already given you.

For example What is a “lease”?

If we ask you, you must give us any document giving you a new or increased A lease is an agreement which allows someone (called the “tenant”) to occupy
interest in your property. a property.
You must also give us, if we ask you, any share certificate or membership
certificate to do with your membership of any of the following: • Give up possession of your property or give someone (for example, a paying lodger)
• a management company; a right to occupy all or part of your property.
• a residents’ association or society; • Change how your property is used or apply to any planning authority for consent to
• a commonhold association; or change its use.
• another similar organisation. • Make any significant changes to your property that affect its structure or that add
to it (for example, building a conservatory or a garage).

• You must tell us (and provide any copies or other information we ask for) if you receive • Deal with any claim for compensation for the loss or reduction in the value of your
any notice, order, direction, licence, consent or permission to do with your property.
property or because an authority takes ownership of your property.

For example For example

You might receive a notice from your local authority telling you to stop using your You might be offered compensation by your local authority because of major
property for running a business, or telling you that they are going to make a works they are carrying out that affect your property, for example a road widening
change to the access road to your property. scheme. You must get our permission before you give up any compensation or
negotiate or agree to an amount of compensation.

What can you do with your property?

• Apply for or get a grant to do with your property.
You may use your property and keep any money from it that you do not have to pay towards
everything you owe. You can do this unless and until you have to pay off everything you owe If we give our permission, we may give it on the basis of conditions that you must keep to.
immediately (which may happen when problems come up). (For details see Chapter 14.)

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 Chapter 10 – Our security and what it covers For example
A husband and wife could be borrowers under this agreement to buy their home, and the
You have to give us certain rights over your property and
wife could also borrow from us with her business partner to buy a property that is to be let
sometimes other things you own so that we can use those to tenants under another mortgage agreement. In that case, the security under this
rights if you do not do something you have agreed to. This agreement would also cover what the wife owes under the other agreement.
Chapter gives you the detail about the rights you give us.
We can keep our security until everything you owe under our agreement (and any other
What is “security”? mortgage agreements and mortgage loans mentioned above) has been paid in full.
Security usually means rights you give us over things you own, to give us extra
The security you give us does not apply to any money you owe us under an
cover in case you do not keep to your obligations under our agreement.
agreement which the Consumer Credit Act 1974 regulates unless that agreement
Security is often given by signing a special form of document called a deed itself says that the security also covers the lending under that agreement.
and we might then need to take formal steps to make the security effective,
for example registering at a Government Department. For example
For example, you sign a mortgage deed to give us a mortgage on your property as The mortgage will not apply to a credit card or a personal loan unless the credit
security. We then need to register it at the Land Registry or the Registers of Scotland. card or personal loan agreement says it is secured by the mortgage.

We can enforce the security if you do not keep to your obligations. This means
that we can use our rights under the security, for example the right to sell your
property. Chapter 15 describes our right to sell your property or deal with it in
other ways, under the heading “What we can do if this section applies”. Chapter 11 – Contacting you
From time to time in this booklet you will see that we may have to
Our security over your property is security for more than just the amount you owe us
contact you to give formal notice if we intend to do something, such as
under this agreement (which we refer to in this booklet as “our agreement”).
make changes to our agreement. There may also be times when you
It also covers any other money you owe us under another mortgage agreement
have to give us formal notice. This Chapter sets out how each of us
you have (or have had) with us or that you have with us in future while we still
have the security over your property. must give that notice and explains when the notice will apply from.
This only applies to a mortgage agreement on another property used as someone’s How can we contact each other?
home (yours or someone else’s, for example where you have let your property), or if it
Where our agreement requires us to “give you notice” of something, then (unless
was intended to be used as someone’s home.
laws and regulations say differently) we will give you notice in writing.
It also covers any money you owe us (or any one of you owes us, if there is more than one
We may, for example, do this by sending an email to an email address you’ve given
borrower) under a mortgage loan we made to (any of) you jointly with someone else. This is the
us, or by writing to you at your property (or the last address you gave us).
case even if the borrowers under this agreement and the other agreement are not the same.
We may agree that an email from you will count as notice. If so, we will tell you first.
Otherwise, you must give us notice by writing to us by post.

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 When will our notice apply from?
When we contact you, it may be to say that you must or can do something or
that we (or someone acting for us) are doing something.
What else can we do?
We may at the same time give you notice of a future date from which something (for example a Chapter 12 – Changes to our agreement
change to an interest rate) will apply, or by which you or we need to take action. If we do not
give a future date, then (unless laws and regulations say differently) the date will be: For certain aspects of these conditions, such as those setting
• the second day after the day we post it (unless we write to an address outside the United out your mortgage term, your monthly payments and details
Kingdom, then the notice will apply from the 7th day after the day we post it); or about what interest we will charge, we have already told you in
• the day we email you (unless we find out through our computer systems that the this booklet about how and when we may make changes to our
email did not reach you on that day). agreement. This Chapter explains how and when we may
If any of these days is a public holiday or on a weekend, that day will not count. make changes to other aspects of these conditions.
In “Getting Started”, we told you how we may change your monthly payments (Chapter 1
For example “When we can change your monthly payments” and “Temporary stop or reduction to monthly
Say we send you a notice by email on a Tuesday, it will apply from that Tuesday. payments”), your mortgage term (Chapter 1 “Temporary stop or reduction to monthly
payments” and “Your arrangements to pay off everything you owe, if you have an interest-
Say we post a notice to you on a Tuesday, it will apply from Thursday in that same week.
only mortgage”), interest rates (Chapter 2 “When can we change a lender variable rate?”
Say we post it on a Friday and the following Monday is a public holiday, it will and “Added rate”), and costs (Chapter 3 “How we can change our standard costs”).
apply from the following Wednesday.
In this Chapter, we tell you how we may change other areas of our agreement.
Say we post it on Tuesday 1st February to you at an address outside the United Kingdom
We may make a change that we reasonably think will not be to your disadvantage. We
and there are no public holidays coming up, it will apply from Thursday 10th February.
may also make a change:
• to help comply with any laws and regulations (see Chapter 18 for an explanation of
what we mean by “laws and regulations”);
• to help comply with any change in how those laws and regulations, are applied or interpreted;

• to reflect an improvement in any service or facility we provide in connection with the

mortgage or our agreement;
• to introduce a new service or facility; or
• to enable us to make reasonable changes to the way we look after your mortgage
account as a result of changes in the banking or financial system.
We will give you at least 30 days’ notice before making the change.

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 Chapter 13 – Letting your property or • We work this out by looking at what we would charge someone with a broadly similar
mortgage agreement to yours who had asked for permission to a letting or change of use.
changing its use • We do this as at the time we first apply the extra interest or additional payment.
You may decide to let your property or change its use. This Chapter
sets out what will happen if we have given you permission first. If we Ending the letting or change of use
have not given you permission first, this Chapter gives details of If you stop letting your property or change back its use, and write to tell us you
have done so, when we find out about it we will promptly stop charging you the
extra amounts that you may have to pay, how we will work out such extra interest or additional payments.
extra amounts and when you can stop paying them.
Telling you about extra interest and regular additional payments
This Chapter applies if you let your property or change its use. Where we give you permission to where you let your property or change its use
do so, that will be subject to the conditions we tell you when we give you the permission.
We will tell you:
The rest of this Chapter 13 applies where we have not given you permission to do so.
• if we make you pay extra interest or additional payments and if we are backdating it/them; or
(Remember that if you do it without our permission, you will have broken our agreement.)
• if we stop charging you the extra interest or additional payments.
What is “letting your property” or “changing its use”?
Letting your property is where you allow someone else (often called a “tenant”)
to live in your property instead of you, or where you charge someone rent to Chapter 14 – When you need to repay immediately
share your property with you.
Sometimes something that you do or fail to do may mean that
A change of use is where you use your property differently to how you had told us you
would use it when you originally applied for your mortgage loan (or at another time if we
you will have to pay us everything you owe immediately. This
have agreed to a change of use before). For example, this could be where you change Chapter sets out the things that will lead to you having to pay
from just using it as your home to also using it wholly or partly for a business. us everything you owe immediately.
When you will need to repay immediately
Extra interest or regular additional payments These are the scenarios when you will have to pay off everything you owe immediately
If you let your property or change its use without our permission, or if we reasonably – and all at once.
believe you have, we can: • You pay late.
• charge you interest on top of another rate you are paying so that there is an added This only applies if:
rate (see Chapter 2 under the heading “Added rate”); or
–– you are more than one month late in paying any money you owe under our agreement and
• make you pay a regular additional payment. the total amount you have fallen behind with is equal to two monthly payments or more; or
We can backdate the extra interest or additional payments to when you originally let –– you have not paid everything you owe by the end of your mortgage term (or, where
your property or changed its use, or to when we reasonably believe you did so. your loan is in different parts with different mortgage terms, if you have not paid
everything you owe by the end of your mortgage term for any part of your loan.)
Amount of extra interest or regular additional payments
It does not apply if you are keeping to an arrangement where we have allowed you to pay late.
If we make you pay extra interest or additional payments, it will be to bring you
reasonably in line with the extra that you would have had to pay if you had asked for,
and we had given, permission to you for the letting or change of use before it started.

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 • If you do not keep to any of your obligations under our agreement or the mortgage (other
than an obligation to pay money) and we reasonably consider that this puts our interests What is a “voluntary arrangement”?
in your property or under the mortgage or our agreement at risk in a material way. An arrangement which is supervised by a person qualified to deal with it (known
• Another lender with any security over your property appoints a receiver, or takes as an “insolvency practitioner”) under which someone you owe money to agrees
possession of your property, does any of the things set out in Chapter 15 under the to accept only part of the money or accepts a late payment.
heading “What we can do if this section applies” or takes steps to do so.
• You have given us false or misleading information and we reasonably believe this • Your property is in England, Wales, or Northern Ireland and you apply for an “interim order”.
has made a significant difference to our decision to lend to you.
• There is a problem with the mortgage over your property or with a guarantee (if we What is an “interim order”?
asked you to get one). A court order which gives you temporary protection from claims by somebody
you owe money to. It gives you time to put together an offer to that person so
This only applies if, for legal reasons:
that you can make a formal arrangement for repayment. The arrangement is
–– the security or any rights or other interest we have in your property are not supervised by a person qualified to deal with it (known as an “insolvency
binding on your property or on any interest in your property; or practitioner”). Under the arrangement, the person you owe money to agrees to
–– we cannot enforce any guarantee of your obligations under our agreement (a guarantee is accept only part of the money or accepts a late payment.
where someone commits to meeting your obligations if you do not meet them).

• We reasonably believe that you are involved in fraud or other serious criminal activity.
• Your property (or a material part of it) is compulsorily purchased – for Chapter 15 – Our right to take possession of
example a local authority forces you to sell your property to them. your property or deal with it in other ways
• This mortgage is also security for money you owe under a mortgage agreement you have with
This Chapter sets out when we may have a right to take
us on another property and we become entitled to use rights under that other mortgage
possession of your property, what we are able to do with your
agreement that are the same or broadly the same as the rights we have under Chapter 15.
property if we do take possession, and what we can do with the
This only applies if your property is not your private residence – for example, you rent it out.
things we find there. Added to this we set out when we may have
the right to enter or ask other people to enter your property, how
For example
Say you have two buy-to-let properties with mortgages with us and this
we will use such a right and what you must do if we do use it.
mortgage is also security for the money you owe on the other property. If, for
example, you do not keep up with your payments on your other mortgage
When does this section apply?
loan, we can appoint a receiver under this mortgage agreement to collect the There are three sections in this Chapter. (The other two sections are headed “Our right
rent and help pay what you owe on the other mortgage loan. to enter your property” and “How we can deal with things left in your property”.)
We can use the powers in this first section if:
• A bankruptcy order – called a “sequestration order” in Scotland – is made against you. • you agree we can do so; or
• You enter into a “voluntary arrangement” – called a “trust deed” in Scotland – with • you have to pay off everything you owe immediately for a reason in Chapter 14.
anyone you owe money to, or you are going to do so.
What we can do if this section applies
• We may make you leave your property (if you have not already done so) so that we can take
possession of it. We might have to go to court for a court order before we can do this.

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 • We may use the other powers given to mortgage lenders under Acts of Parliament
What does taking possession of your property involve? and other laws and regulations.
It means we take over control of your property from you. If you are in occupation,
you have to leave your property, and if you do not leave, you will be considered to
What are the relevant Acts of Parliament?
be occupying your property wrongly, as a “trespasser”. If your property is already
The main Acts of Parliament that apply are:
let, we take over the right to manage your property and receive the rent.
–– If your property is in England or Wales, the Law of Property Act 1925.
If we take possession, laws and regulations make us responsible for some
things, for example taking reasonable care of your property and using any –– If your property is in Scotland, the Conveyancing and Feudal Reform
rents or other income received to pay towards what you owe. (Scotland) Act 1970 (as amended).
–– If your property is in Northern Ireland, the Conveyancing and Law of
• We may let your property on any reasonable terms. Property Acts 1881 and 1911.
What powers do the relevant laws and regulations give us?
What does “let your property” mean? These powers include the ability to take a surrender of leases and to
This means we can grant someone the right to occupy your property in return for insure your property. This is in addition to our ability to sell or let your
paying rent. This would normally be under the terms of a lease. property, or to take possession of it.

• We may sell your property (even if we have not taken possession of it).
• We may use the same powers as a receiver has under laws and regulations or which
we set out in Chapter 16 under the heading “What powers do an attorney and a
What happens if we sell your property? receiver have?” (We may do this even if a receiver has been appointed).
• We must sell it for the best price we can reasonably get.
• We will use any money we, or a receiver, obtains from the sale to pay what you Our right to enter your property
owe us. If there is any money left over, we must pay it to anybody we know has We may ask people to come into your property for a reason to do with our agreement.
a right to it (for example, another lender with a mortgage on your property), and
if there is any money left over after that we will pay it to you.
For example
• If we sell your property for less than everything you owe, you must still pay us the
We might ask one of our employees or a valuer or surveyor to inspect your
difference and we will continue to charge interest on it until you do. (This also
property or we might ask a builder to do some work you should have done.
applies if we allow you to sell your property for less than everything you owe.)
There are restrictions in certain sections of Acts of Parliament which we are
allowed to say will not apply in our agreement. On that basis, the following You must allow them in. We will give you notice before we send them unless we
sections of Acts of Parliament do not apply. cannot contact you or it is an emergency.
• If your property is in England or Wales, Section 103 of the Law of Property Act 1925. When they come into your property, it does not mean we are a mortgage lender in
• If your property is in Northern Ireland, Section 20 of the Conveyancing and possession of your property, or that we have accepted the legal responsibilities of a
Law of Property Act 1881. mortgage lender in possession of your property.
Section 103 of the Law of Property Act 1925 and Section 20 of the Conveyancing and Law of
Property Act 1881 both say that we cannot use our power to sell your property until certain How we can deal with things left in your property
conditions have been met. If we did not disapply them, the conditions would mean, for If we take possession of your property, we may remove, store, sell or dispose of
example, that if we issued a notice asking you to make a payment, we would have to give anything you leave at your property (including animals). We will do this as your
you three months to make the payment before exercising our right to sell. “agent”. You will have to pay our costs of doing this.

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 Chapter 16 – Acting on your behalf For example
You give us the right to act on your behalf in certain respects, and We might need you to confirm to the Land Registry or Registers of Scotland that
we were able to sign a form on your behalf.
in some circumstances to appoint others to do so. This Chapter
explains what this may mean for you in practice and gives details
of when we will be able to appoint others to act for you, and the Our right to appoint a receiver
powers that we and those others will have over your property. If you must pay off everything you owe immediately (which you may have to do in the
situations described in Chapter 14) we may appoint a receiver for the whole of your
Making us or a receiver your attorney property or any part of it. This does not apply if your property is in Scotland.
We will be your attorney until all the money you owe that is secured by the mortgage
has been paid off in full.
What does a receiver do?
If we appoint a receiver, the receiver will also be your attorney. Broadly speaking a receiver is someone we can appoint to manage your
property and to sell or rent it out and to receive rent and other income payable in
What is an “attorney”? connection with your property (among other things). Although we would appoint
“Attorney” broadly means someone legally entitled to act on someone else’s behalf. the receiver, he would act for you (not us) and you would have to pay for him.

This means we (and a receiver) can do a number of things in your name, but only • We may appoint one of our employees as the receiver (however, if we do, he will
those which are described in this Chapter. be acting independently of us, rather than as our employee or agent).

Appointment of us and a receiver as your attorney • We may arrange for the receiver to be paid at a reasonable level.
By way of security, you appoint us and (if we appoint a receiver) the receiver, to be your attorney. • We may remove the receiver at any time and appoint another person as receiver instead.

• The receiver will be your agent (this means that you will be responsible for his actions).
This is to allow us (or the receiver) to do things like signing documents instead of you You will be responsible for meeting the receiver’s pay and costs and expenses (for example,
where we need them to do with the mortgage or your property or our agreement. the cost of insuring your property, which you are required to do as described in Chapter
7). However, you will not be responsible for meeting the receiver’s pay if he
• Your appointment of us as your attorney is a separate appointment to the is one of our employees.
appointment of any receiver as your attorney.
What powers do an attorney and a receiver have?
• You cannot cancel these appointments until all the money you owe which is
Your attorney and (if we appoint a receiver) the receiver have the following powers.
secured by the mortgage is paid off in full.
• As your attorney we (and the receiver) will be authorised to use certain powers in • To receive any money payable to you
your name and on your behalf. (These powers are described in this Chapter under relating to: –– your property;
the heading “What powers do an attorney and a receiver have?”).
–– any right to your property or claim over it; or
• Where there is more than one of you, when acting as your attorney we (and the
receiver) will act for all of you together and each of you separately. –– any insurance, guarantee or compensation relating to your property, the
mortgage or our agreement.
• If we ask you to, you will confirm anything done by us (or the receiver) as your
attorney while acting under this Chapter. • To choose whether or not to use any money the attorney or the receiver receives to pay off
interest on your loan before paying off the loan itself and any charges and costs.

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 • To use your rights to make any claim or do anything else • To appoint a receiver (but a receiver may not appoint a receiver).
relating to: –– your property; or We may only use the powers set out above (under the heading “What powers do an attorney and
a receiver have?”) as your attorney if you must pay off immediately everything you owe (which
–– any insurance, guarantee or compensation relating to your property, the
you may have to do in the situations described in Chapter 14). We may however use the
mortgage or our agreement.
following powers as attorney at any time. The receiver may use all of the powers above and
below (except the power to appoint a receiver) once he has been appointed.
For example
• To employ and pay agents to carry out work on our or the receiver’s behalf.
We, or the receiver, might need to bring or continue court proceedings on your
behalf connected to a claim you were making to do with your property.
For example
We may need to employ managing agents to manage your property if it is let
• To insure your property and we, or the receiver, may
to more than one tenant.
decide: –– who the insurer will be;
–– what will be covered by the policy; and – • To instruct anybody, (for example, a solicitor) who has any documents or accounting
– the amount of the cover and any excess.
information (including tapes, films or computer records) about the mortgage, our
agreement or your property or the ownership of your property, to let us look at them,
We, or the receiver, will keep any commission paid or allowed for any insurance take copies of them or ask for them to be sent to us.
we, or the receiver, arrange.
• To take any of the following steps where needed to protect our interests in your
The insurance we, or the receiver, put in place may be to protect only our interests and property or to help us use our right to take possession of your property or
may not cover your interests or the interests of anyone else at all. If, in fact, any of your otherwise deal with it (as described in Chapter 15).
or anyone else’s interests are covered, they might only be partly covered.
–– To transfer any share or membership right in any management company or
• To deal with any insurance claim payout received as your attorney. We or the receiver will residents’ association or society or commonhold association (or other similar
use it to repair or rebuild your property or for another purpose for which the payout was organisation) connected with your property of which you are a member.
made, unless we or the receiver give you notice that it is to be used to pay towards
–– To use any rights you may have as a member of any of those organisations.
everything you owe. We or the receiver will not do that unless we or the receiver
reasonably consider that using the money to repair or rebuild your property or for the –– To ask for the cancellation and reissue of any certificate in respect of any
other purpose referred to above will not put your property in good enough repair to cover share or membership right which you have in any of those organisations.
everything you owe or will not meet the other purpose the payout was made for.
• To take action to keep your property in good repair and condition.
• To make arrangements with any current or former tenant or occupier of your
• To take action to meet any laws and regulations relating to your property.
property or to enforce their obligations.

For example
For example
We might need to take action to ensure that your property complies
We may need to collect unpaid rent from a tenant.
with fire safety requirements.

• To take action to surrender or terminate any tenancy or to get possession of your

• Where we or the receiver find out that the mortgage deed is not binding on your
property (or any part of it) and grant new leases of your property.
property, to take steps to remedy this.
• To sell your property on such terms as we or the receiver see fit. We must, however,
• To sign any forms or documents needed for your property.
sell it for the best price we, or the receiver, can reasonably get.

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 If there is a transfer, how will this affect you?
For example You agree to be bound to any person to whom we transfer or to any person who
We may need to sign forms to do with Stamp Duty Land Tax or Land receives a transfer after that, and to be bound in the same way and to the same extent
Registry or Registers of Scotland matters. as you are bound to us under our agreement.

• To do anything else reasonably required to do with the mortgage, your What does this mean for you?
property or our agreement. If we transfer our rights to someone else, you will have to do everything you
• To do anything else you have to do under our agreement and any related security. have to under our agreement for them, instead of for us. For example, you will
have to pay them instead of us.

Chapter 17 – Our right to transfer our From then on, the person who we transfer to or any person who receives a transfer
after that will also count as “us” under our agreement to the extent that rights have
rights in the mortgage and our agreement been given to them. “We”, “us” and “our” will then also refer to that person but only
to the extent that rights have been given to them.
We may choose to transfer the mortgage and our rights under
our agreement to someone else. This Chapter sets out when we This does not affect anything done or received before the transfer, which can still be
relied on by the person who TSB Bank plc transfers to or any person that receives a
may do this and how it may affect you if we do. transfer after that as though also done or received by them for their benefit.
We may transfer some or all of our rights in the mortgage and our agreement to
Any rights under the mortgage and our agreement may be held by TSB Bank plc for
someone else. This includes giving someone else our right to transfer any related
its own benefit and for the benefit of any person who receives a transfer of rights in
rights or interests under the mortgage deed, any offer letter and any other agreement
relation to the mortgage and our agreement.
you make with us to do with your mortgage loan.
You agree that we can pass on any information or documents relating to your mortgage loan
A common example of this is where we transfer our rights in the mortgage and our
application, the mortgage, mortgage deed, any offer letter and any other agreement you make
agreement to a third party so they can benefit from the income. If the mortgage and our
with us to do with your loan to any person who takes over any rights as set out in this Chapter in
agreement is transferred in this way, the interest rate, charges and costs will still be set in
relation to the mortgage and our agreement, for that person to use in the same way as us. You
line with our other mortgage agreements and the conditions of our agreement will not
also agree that we may give details about the mortgage and our agreement, or your name and
change. As a result, we do not have to tell you that this type of transfer has taken place.
address to anyone else we are discussing transferring the mortgage and our agreement to.
There is another type of transfer, however, where we would have to give you notice.
This is where we do not keep the right to set interest rates, charges and costs.
If we want to transfer our rights under this Chapter we shall only do so if the person we Chapter 18 – Other conditions
transfer those rights to agrees with us to use them in accordance with an agreed policy and
procedure (subject to the next paragraph in this Chapter). We will approve the agreed policy This Chapter sets out important conditions that do not easily
and procedure before the transfer. The agreed policy and procedure shall be no less fit within any of the other Chapters but which give you more
favourable to you than the policy and procedure we were following before the transfer. details about our agreement with you.
The policy and procedure we adopt for other mortgage loans where we have not transferred If the offer letter says we will lend you the money by instalments, or we keep back
our rights may change after a transfer under this Chapter. Also, a person we have transferred part of your loan, and you have not kept to all your obligations under our agreement,
our rights to may ask us to make a change to the policy and procedure it has agreed to we may refuse to pay the instalments or to release the money kept back.
follow. If that happens, we can agree to the change provided that the revised policy and
procedure is in all important ways the same as the one we are then following. Where we refer to “you” and “your” in our agreement this can include a personal
representative, a successor or anyone else who takes over your legal rights or duties.

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 Laws and regulations imply some conditions which apply to our agreement. For Telephone calls to or from us (or someone acting on our behalf) may be monitored and
example, as well as our powers under our agreement we have powers under the recorded by us (or someone acting on our behalf). We may do this to check any
general law. We have not set out the implied conditions in this booklet, and your instructions you give us over the telephone and to help us train our staff.
solicitor or licensed conveyancer can tell you what they are.
You agree to sign any document we may need to safeguard the mortgage or our other security or
When we talk about “laws and regulations” this includes all laws, rules, codes of to protect our interests in your property. We will prepare any documents at your cost.
practice, decisions, recommendations and requirements laid down by any court,
The Contracts (Rights of Third Parties) Act 1999 will not apply to these conditions. An
regulator, government authority or agency or other similar body.
exception to this is that if we transfer any of our rights under the mortgage and our
Any reference to legislation in this booklet includes any statutory instrument (for agreement, the person we transfer to will be able to use the rights we have transferred.
example, regulations and rules) made under relevant legislation and any changes to
either the legislation or the statutory instrument. Where we refer to the “law” or to
“laws”, this includes any legislation that applies. What does the Contract (Rights of Third Parties) Act 1999 do?
If we choose not to enforce any part of our agreement, or delay enforcing it, this will not affect our Before this law was made, other people who did not sign up to our
right to enforce the same part later (or on a separate occasion) or the rest of our agreement. agreement could not use rights under our agreement. Because of this law,
other people might be able to use rights so we include this term to make sure
For example they cannot. This Act does not apply in Scotland.
Say you do not pay us and we have the right to ask the court to allow us to take
possession but we do not ask them then, we can still ask them later on. Our agreement is supplied in English and communications between you and
us will be in English.
If we get a court order to make you pay us what you owe, we will continue to charge
interest at the rate you should have been paying just before the order, and that rate will Our agreement is governed by the laws and regulations of the country in which your
continue to be fixed or variable on the same basis. property is situated. We also take the laws and regulations of that country as the basis
for the establishment of relations with you before our agreement is entered into.
If we cannot enforce any part of our agreement, this will not affect our right to enforce
the rest of our agreement.
For example
For example If your property is in Wales, the laws and regulations of England and Wales
Say a court says that one of the terms of a condition is not fair and so we cannot will apply to our agreement.
use our rights under that term, we can still use our rights under the rest of that
condition and under other conditions. If there is a conflict between different parts of our agreement then, so far as
laws and regulations allow:
We will not be liable to you for any direct or indirect loss you suffer (for example any
• The part of this booklet called “Our Mortgage Conditions” will apply over the
loss of profit) if we are unable to provide any service or fulfil any obligation under
“standard conditions” at the end of the booklet (in any case, the “standard
our agreement for reasons beyond our reasonable control.
conditions” only apply if your property is in Scotland);
• your offer letter and any other agreement you make with us to do with your mortgage
For example
loan will apply over anything in this booklet; and
You will not be able to claim anything from us if you want to check the
amount you owe, and there is something wrong with our computers that • any other agreement you make with us to do with your mortgage loan will apply over
we could not stop by looking after them properly and we could not fix them your offer letter, and anything in this booklet.
by the time you wanted to check the amount you owe.

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 (b) not to demolish, alter or add to any buildings or works forming part of the security
Standard conditions subjects, except in accordance with the terms of a prior written consent of the
creditor and in compliance with any consent, licence or approval required by law;
For properties in Scotland, the law states that there are certain conditions (c) to exhibit to the creditor at his request evidence of that consent, licence or approval.
which apply to mortgages. These are called the “standard conditions” and 3. Observance of conditions in title, payment of duties, charges etc., and
they are contained in Schedule 3 to the Conveyancing and Feudal Reform general compliance with requirements of law relating to security subjects
(Scotland) Act 1970 (as amended). We have included the standard It shall be an obligation on the debtor:
conditions below. The part of this booklet called “Our Mortgage Conditions” (a) to observe any condition or perform any obligation in respect of the security
subjects lawfully binding on him in relation to the security subjects;
makes some changes to these standard conditions.
(b) to make due and punctual payment of any ground burden, teind, stipend, or
standard charge, and any rates, taxes and other public burdens, and any
For example other payments exigible in respect of the security subjects;
Standard condition 5 states a debtor’s insurance obligations. Chapter 7 of this
(c) to comply with any requirement imposed upon him in relation to the security
booklet tells you about your insurance obligations. These may differ. For
subjects by virtue of any enactment.
example, Chapter 7 states that you must hold any money you get from a claim
4. Planning notices, etc.
under any buildings insurance for your property on “trust” for us.
It shall be an obligation on the debtor:
(a) where he has received any notice or order, issued or made by virtue of the
NOTE: THIS SCHEDULE ONLY APPLIES IF THE PROPERTY IS IN SCOTLAND
Town and Country Planning (Scotland) Acts 1947 to 1969 or any
Conveyancing and Feudal Reform (Scotland) Act 1970 (as amended) amendment thereof, or any proposal so made for the making or issuing of
any such notice or order, or any other notice or document affecting or likely
Schedule 3 to affect the security subjects, to give to the creditor, within fourteen days of
The standard conditions the receipt of that notice, order or proposal, full particulars thereof;
1. Maintenance and repair (b) to take, as soon as practicable, all reasonable or necessary steps to comply
It shall be an obligation on the debtor: with such a notice or order or, as the case may be, duly to object thereto;
(a) to maintain the security subjects in good and sufficient repair to the (c) in the event of the creditor so requiring, to object or to join with the creditor in objecting to
reasonable satisfaction of the creditor; any such notice or order or in making representations against any proposal therefor.
(b) to permit, after seven clear days notice in writing, the creditor or his agent to enter 5. Insurance
upon the security subjects at all reasonable times to examine the condition thereof; It shall be an obligation on the debtor:
(c) to make all necessary repairs and make good all defects in pursuance of his (a) to insure the security subjects or, at the option of the creditor, to permit the
obligation under head (a) of this condition within such reasonable period as the creditor to insure the security subjects in the names of the creditor and the
creditor may require by notice in writing. debtor to the extent of the market value thereof against the risk of fire and
2. Completion of buildings etc. and prohibition of other such risks as the creditor may reasonably require;
alterations etc. It shall be an obligation on the debtor: (b) to deposit any policy of insurance effected by the debtor for the aforesaid
(a) to complete, as soon as may be practicable, any unfinished buildings and works purpose with the creditor;
forming part of the security subjects to the reasonable satisfaction of the creditor; (c) to pay any premium due in respect of any such policy and, where the creditor
so requests, to exhibit a receipt therefor not later than the fourteenth day, after
the renewal date of the policy;

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 (d) to intimate to the creditor, within fourteen days of the occurrence, any (2) For the purposes of this condition, the proprietor shall be taken to be insolvent if:
occurrence which may give rise to a claim under the policy, and to (a) he has become notour bankrupt, or he has executed a trust deed for behoof of,
authorise the creditor to negotiate the settlement of the claim; or has made a composition contract or arrangement with, his creditors.
(e) without prejudice to any obligation to the contrary enforceable against him, to (b) he has died and a judicial factor has been appointed under section 11A of
comply with any reasonable requirement of the creditor as to the application the Judicial Factors (Scotland) Act 1889 to divide his insolvent estate
of any sum received in respect of such a claim; among his creditors, or his estate falls to be administered in accordance
(f) to refrain from any act or omission which would invalidate the policy. with an order under section 421 of the Insolvency Act 1986;
6. Restriction on letting (c) where the proprietor is a company, a winding-up order has been made with
It shall be an obligation on the debtor not to let, or agree to let, the security respect to it, or a resolution for voluntary winding-up (other than a members’
subjects, or any part thereof, without the prior consent in writing of the creditor, and voluntary winding-up) has been passed with respect to it, or a receiver or
‘to let’ in this condition includes to sub-let. manager of its undertaking has been duly appointed, or possession has been
7. General power of creditor to perform obligations etc. on failure of debtor taken, by or on behalf of the holders of any debentures secured by a floating
and power to charge debtor charge, of any property of the company comprised in or subject to the charge.
(1) The creditor shall be entitled to perform any obligation imposed by the 10. Rights of creditor on default
standard conditions on the debtor, which the debtor has failed to perform. (1) Where the debtor is in default, the creditor may, without prejudice to his exercising any
(2) Where it is necessary for the performance of any obligation as aforesaid, the other remedy arising from the contract to which the standard security relates, exercise, in
creditor may, after giving seven clear days notice in writing to the debtor, accordance with the provisions of Part II of this Act and of any other enactment applying
enter upon the security subjects at all reasonable times. to standard securities, such of the remedies specified in the following sub-paragraphs of
(3) All expenses and charges (including any interest thereon), reasonably incurred by the this standard condition as he may consider appropriate.
creditor in the exercise of a right conferred by this condition, shall be recoverable from (2) He may proceed to sell the security subjects or any part thereof.
the debtor and shall be deemed to be secured by the security subjects under the (3) He may enter into possession of the security subjects and may receive or
standard security, and the rate of any such interest shall be the rate in force at the recover the rents of those subjects or any part thereof.
relevant time in respect of advances secured by the security, or, where no such rate is
(4) Where he has entered into possession as aforesaid, he may let the security
prescribed, shall be the bank rate in force at the relevant time.
subjects or any part thereof.
8. Calling-up (5) Where he has entered into possession as aforesaid there shall be transferred to him all
The creditor shall be entitled, subject to the terms of the security and to any requirement of
the rights of the debtor in relation to the granting of leases or rights of occupancy over
law, to call-up a standard security in the manner prescribed by section 19 of this Act.
the security subjects and to the management and maintenance of those subjects.
9. Default (6) He may effect all repairs and may make good such defects as are necessary to
(1) The debtor shall be held to be in default in any of the following circumstances, maintain the security subjects in good and sufficient repair, and may effect such
that is to say: reconstruction, alteration and improvement on the subjects as would be expected
(a) where a Calling notice in respect of the security has been served and has of a prudent proprietor to maintain the market value of the subjects, and for the
not been complied with; aforesaid purposes may enter on the subjects at all reasonable times.
(b) where there has been a failure to comply with any other requirement (7) He may apply to the court for a decree of foreclosure.
arising out of the security;
(c) where the proprietor of the security subjects has become insolvent.

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 11. Exercise of right of redemption
(1) The debtor shall be entitled to exercise his right (if any) to redeem the
security on giving notice of his intention so to do, being a notice in writing
(hereinafter referred to as a ‘notice of redemption’).
(2) Nothing in the provisions of this Act shall preclude a creditor from waiving the
necessity for a notice of redemption, or from agreeing to a period of notice of
less than that to which he is entitled.
(3) (a) A notice of redemption may be delivered to the creditor or sent by
registered post or recorded delivery to him at his last known address, and
an acknowledgement signed by the creditor, or his agent or a certificate of
postage by the person giving the notice accompanied by the postal receipt
shall be sufficient evidence of such notice having been given.
(b) If the address of the creditor is not known, or if the packet containing the
notice of redemption is returned to the sender with intimation that it could
not be delivered, a notice of redemption may be sent to the Extractor of
the Court of Session and an acknowledgement of receipt by him shall be
sufficient evidence of such notice having been given.
(c) A notice of redemption sent by post shall be held to have been given on
the day next after the day of posting.
(4) When a notice of redemption states that a specified amount will be repaid, and it is
subsequently ascertained that the whole amount due to be repaid is more or less
than the amount specified in the notice, the notice shall nevertheless be effective as
a notice of repayment of the amount due as subsequently ascertained.
(5) Where the debtor has exercised a right to redeem, and has made payment of
the whole amount due, or has performed the whole obligations of the debtor
under the contract to which the security relates, the creditor shall grant a
discharge in the terms prescribed in section 17 of this Act.
12. The debtor shall be personally liable to the creditor for the whole expenses of the
preparation and execution of the standard security and any variation, restriction
and discharge thereof and, where any of those deeds are recorded, the recording
thereof, and all expenses reasonably incurred by the creditor in calling-up the
security and realising or attempting to realise the security subjects, or any part
thereof, and exercising any other powers conferred upon him by the security.
Interpretation
In this Schedule, where the debtor is not the proprietor of the security subjects, ‘debtor’
means ‘proprietor’, except:
(a) in standard conditions 9(1), 10(1) and 12, and
(b) in standard condition 11, where ‘debtor’ includes the proprietor.

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Please contact us if you’d like this
information in an alternative format
such as Braille, large print or audio.
If you have a hearing or speech impairment and would prefer to
use a Textphone, please feel free to call us on 03458 353 843.
We may monitor or record phone calls with you to help improve the quality of our service.
TSB Bank plc. Registered Office: Henry Duncan House, 120 George Street, Edinburgh EH2 4LH.
Registered in Scotland no. SC095237.
Authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority
and the Prudential Regulation Authority under registration number 191240.
TSB Bank plc is covered by the Financial Services Compensation Scheme and the Financial
Ombudsman Service.

TSB12033(M) (04/18)

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