Can I Remove Grounds 1 and 2 From Agreement?
A common question we receive is about grounds 1 and 2 in the assured shorthold tenancy agreement produced by the Tenancy Builder and whether a landlord can remove them if they don’t apply at the time of drawing up the tenancy.
Ground 1 is the possibility that the property might be required by the landlord (or a member of their family) to use as their home and ground 2 is about a mortgage on the premises.
When we first made the Tenancy Builder, it used to be an optional setting whether to insert those grounds or not.
Even though we’ve never had a problem, over time, we became worried that there was potential for a problem if somebody didn’t insert either of those options. So, a few years back, we removed the option and made it fixed text.
There is reasoning to keeping these two clauses in the agreement and why the clauses can’t be removed.
Although you may not have a mortgage right now on the property, because it’s difficult to know how long a tenant might remain in the property on the same tenancy, it’s possible that you may want to obtain a mortgage on the property sometime in the future. The future is impossible to predict and you just never know!
In almost every case, a mortgage company will require such a clause in the tenancy (or at least notice served on the tenant before they occupy the premises which is what that clause technically does) before they will allow a mortgage on the property.
Even if a landlord doesn’t think they will ever need a mortgage, the same principle applies if they were to ever sell the property. Any purchasers’ mortgage company will almost always insist that clause is present before agreeing to a mortgage.
Have in mind, the clause is only relevant if possession is sought on the basis of ground 2. A landlord would never rely upon that ground in the real world and as such all the clause is, is a waste of ink if it isn’t needed right now. Being there is doing no harm even if it’s never used.
Similarly, ground 1 might prove useful if ever section 21 is banned (which is a manifesto pledge at the time of writing). Again, it might never be relied upon by the landlord but by having the clause there’s an extra option available for possession. If it’s never used, then like ground 2, it’s just been a waste of ink and nothing more.