Families of missing mortgage borrowers may be given power of guardianship

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MPs are debating the introduction of a new law that gives families of missing persons’ guardianship rights.

If a family member goes missing, currently there is no way that the family can protect the mortgage and the property of the missing person.

This law, however, would enable family members to become guardians over the mortgage and property of missing persons. This would work in a similar way to the guardianship rules that apply to people with mental health issues.

A guardian would be able to make financial decisions concerning a mortgage borrower’s financial matters and property. This will limit the legal liability of the mortgage lender if the guardian wants the lender to administer the mortgage.

The Council or Mortgage Lenders has welcomed the proposed new law. In a statement, the Council of Mortgage Lenders said:

“The bill would help lenders, who currently can be prevented by confidentiality rules and legal obligations from making pragmatic arrangements in a customer’s absence. Overall, the legislation, if enacted, would provide a welcome, practical way forward for lenders who want to help people who go missing and their families.”

The guardianship rules could mean that if a missing person returns home, they will not be faced with mounting debts.

Many borrowers take out life insurance cover that can pay off the mortgage if they die. A missing person needs to have been missing for seven years before an application can be made to declare them legally dead.

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