Forfeiture of Lease
The Forfeiture of Lease legal indemnity insurance policy provides cover for a mortgage lender when the landlord of a single private flat or maisonette based within England and Wales exercises, or attempts to exercise, a legal right to forfeit the lease during the term of the mortgage advance granted at the policy’s commencement date.
The policy can be used with residential properties only and does not cover the buyer or owner of the property.
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Key Features and Benefits
If during the term of the mortgage advance the landlord exercises, or attempts to exercise, a legal right to forfeit the lease, the policy provides cover for the following, up to your selected limit of indemnity *:
- any irrecoverable sums expended with our consent to protect the lender's interest in the property, including the cost of complying with any court order
- the reduction in the value of the lender's interest in the property, if the lease is terminated
- costs and expenses with our consent.
The policy does not provide cover for the owner of the property, except for the named mortgagee when in possession.
The policy remains in force from its commencement date for the duration of the mortgage advance.