Legal expenses in repossession cases

Most standard mortgage agreements contain a clause stating that the borrower will be liable to pay for any expenses that the lender reasonably incurs relating to the mortgage.

This content applies to Scotland

Mortgage repossession - legal expenses

When the borrower falls into arrears the cost of serving a notice and any further legal action may be included in their debts to the lender. [1] However, in some cases the borrower may be able to argue that they should not be liable for legal costs. It has been held that if the lender's legal action was not reasonably necessary then it is the lender that is liable for covering both sides' legal expenses. [2] In that particular case the debtor had already agreed to sell her home and pay off her mortgage and arrears before her lender applied for a decree for repossession.

Last updated: 7 February 2020


  • [1]

    standard condition 12, Conveyancing and Feudal Reform (Scotland) Act 1970

  • [2]

    Royal Bank of Scotland Plc. v Kinnear 2005 HLR 2; 2001 GWD 3-124