The last few months have seen a range of pronouncements from the constituent governments across the UK which provide some indication that we are moving in a positive direction towards a return to normality.

Amongst the most important of these changes, especially for lenders, are those which affect the actions which lenders can take around possession and enforcement proceedings.

Of course, as we have seen throughout the pandemic, all four parts of the UK have essentially been taking their own independent view to managing various aspects of the pandemic, albeit endeavouring to taking a four nations approach where appropriate and this independence does of course also apply to policies which are not directly health related.

The law and guidance around possession and enforcement falls into this category and lenders in each nation, many of which have operations in more than one, are getting to grips with what this means for them.

In England and Wales, for example, it has been confirmed that the evictions ban on mortgage arrears ended on 31 May 2021, although bailiffs have been asked not to carry out an eviction if anyone living in the property has Covid symptoms or is self-isolating.

In Scotland, since the outbreak, lenders have been required to adhere to guidance from the FCA alongside regulations from the Scottish government as to whether they can proceed with possession proceedings or possession orders. Currently the restrictions across Scotland can vary depending on what level a particular region is in. There is currently a ban on eviction in levels three and four on the enforcement orders for residential property.  It is hoped that by 19 July all tiers are reduced to zero across Scotland and by 9 August all restrictions are removed.

With regard to Northern Ireland, there is no statutory or government guidance which prevents evictions and the Enforcement of Judgements Office (EJO) will take evictions forward on a case by case basis.

The effective moratorium on proceedings across the UK has now been in place for over a year, the result of which is that cases have been building up, both those prior to the pandemic and those arising during it.

This does of course create an issue for many lenders and at some point these cases need to be attended to.

The big questions are when and how do you begin again?

There’s no doubt that this is a situation which lenders are having to give substantial thought to and one which requires great sensitivity.

There is, necessarily, a balance to be struck and understandably reputational impact is high on the list of priorities, as is the duty of care to customers, but nevertheless, the volumes of cases exist and they are not going away.

In view of this, timing is everything, as is the action a lender can take.

In terms of timing, the old saying ‘there’s no time like the present’ couldn’t be more apt. Clearly waiting for the perfect moment is not realistic – it may never happen. However, any action, as ever, must be coupled with great care.

In E&W, a lender should make all reasonable efforts to resolve a situation. There are of course alternatives to repossession and borrowers should be encouraged to contact their lender to consider options such as delaying interest payments, extending a mortgage term, changing the mortgage type or adding arrears to the mortgage debt.

In Scotland, if an area is in level zero, lenders can consider enforcement of possession orders but FCA guidance states that the enforcement should be a last resort.

For Northern Ireland, Notices of Intention to Enforce and Full Enforcement Applications can be issued as normal. Lenders who wish to proceed with enforcement in NI can take all steps up to eviction. The EJO is not setting eviction dates at present and it’s not known when evictions will resume.

Ultimately the relaxation on enforcement should not be seen by lenders as simply a green light to proceed as things were pre-pandemic. However, it does mean that lenders can and should begin the process of re-engaging with their customers so that they can establish their particular circumstances.

Proceed with caution. But proceed.