EBS confirms its position on redemption figures

Conveyancing 05/04/2012

The committee has been in correspondence with EBS concerning the format of letter used by EBS to provide redemption figures to solicitors in relation to clients鈥 loans. The background to this matter is that the Conveyancing Committee had received a number of complaints from solicitors to the effect that EBS was issuing qualified or conditional redemption figures. This was on the basis that the standard EBS letter stated that 鈥淭hese figures will change in the event of an interest rate alteration, a returned payment or a further lodgement being made prior to the redemption of the loan(s).鈥

When the committee took the matter up with EBS, it was confirmed to the committee that: 鈥淚f an event takes place which affects the amount quoted, as a direct result of action taken by a customer such as a cancelled direct debit, the solicitor is protected under 5(d) of the agreement which states that: 鈥業f, after redemption, the redemption sum quoted by the Lender is found to be inadequate to redeem the loan(s), the Lender shall not withhold the release/discharge/vacate (see paragraph 23 below) but shall be free to pursue any other remedies against the Borrower that are available to the Lender鈥.鈥

Practitioners should therefore note that, while the standard EBS letter may continue to make reference to matters such as 鈥渢he redemption figure stated below is valid for 鈥 days and is subject to all payments received to date being honoured, including direct debit payments which are credited to customers accounts by EBS on the call date鈥, the lending institution has confirmed it will, nonetheless, observe the terms of the 2009 Certificate of Title agreement between the IBF and the Law Society and will not withhold issuing a vacate to a solicitor on account of any discrepancy between the redemption sum quoted by EBS and the sum required to redeem the loan.

If any practitioners still continue to encounter difficulties in obtaining vacates/discharge/releases from EBS, please write to the committee and forward copies of relevant documentation.