Mortgages & acting for the lender
A mortgage is a charge over the property that secures the loan. A solicitor frequently acts for both the buyer and the lender, subject to the conflict rules.
What "Mortgages & acting for the lender" covers
- A legal mortgage of registered land is a registered charge under the LRA 2002 and must be registered to take effect at law.
- Acting for buyer and lender together is permitted where there is no conflict and the mortgage is on standard terms, but any conflict must be reported.
- Report on title to the lender and comply with the instructions in the UK Finance Mortgage Lenders' Handbook.
- Give the lender a certificate of title and draw down the mortgage advance in time for completion.
- Priority of charges follows registration; a first legal charge ranks ahead of any later charge.
- On redemption the charge is discharged (form DS1 or an electronic discharge) and removed from the Charges Register.
- Where the seller's property is mortgaged, give an undertaking to discharge that mortgage from the sale proceeds.
Key cases & statutes
The authorities and provisions most likely to matter for this subtopic:
How it's tested in SQE1
SQE1 uses single best answer questions: a short factual scenario, one precise question, and five options of which only one is the best answer on the law applied to the facts. For mortgages & acting for the lender, expect to be asked what the correct legal position is, what a party may or must do, or which outcome follows — with more than one option looking arguable. Reading the facts carefully and eliminating the near-misses is the skill that earns the mark.
Where candidates lose marks
- Continuing to act for both parties where a conflict of interest has arisen.
- Failing to register the lender's charge, so it does not take effect at law.
- Relying on an undertaking to redeem the seller's mortgage without ensuring it is honoured.
Learn this subtopic in the course
A video lesson, notes and exam-style practice on mortgages & acting for the lender.
FAQ
Is mortgages & acting for the lender tested on SQE1?
Yes — mortgages & acting for the lender is part of the SQE1 Property Practice syllabus (FLK2) and can appear in single best answer questions.
How is mortgages & acting for the lender examined in SQE1?
SQE1 tests it by application: you're given a realistic scenario and choose the single best answer from five options. The focus is on using the law correctly, not reciting it — knowing the leading authorities (registered charge (LRA 2002), UK Finance Mortgage Lenders' Handbook) helps.