What are the powers of an LPA receiver?

With an increasing number of prime developments across the UK falling into receivership under the management of Law of Property Act Receivers, being fully aware of their powers is vital.


LPA Receivers (Receivers) are called in by lenders to manage a receivership when those who have used property as security for a loan have breached the conditions of their loan agreements.


Developers or individuals with mortgages may have failed to keep up with repayments, forcing receivers to step in.


An LPA receiver can take charge of property by insuring it, securing it, ordering repairs or even seeking planning permission, all while working to meet the interests of the lender.


Furthermore they will work to recover outstanding debt and can arrange for a property to be let out or sold if necessary.




Under the Law of Property Act, the powers of a receiver extend only to the property over which the legal charge is made and not to the individual or company which is the borrower.


If an individual is unable to pay debts they would enter either an Individual Voluntary Arrangement under direction of court appointed overseer or personal bankruptcy.


Meanwhile a company that can no longer trade would be placed in Administration or Administrative Receivership if it can be rescued or liquidation if all that can be done is to sell assets.


A receiver can collect monies due to the property if rents are due and must deal with any issues which relate to looking after the state of the property.


This covers an array of issues from securing the property to repairing any issues and insuring it.


If the property is occupied illegally or if the occupier has defaulted in his obligations, a receiver can obtain possession using whatever means are available.


They are also able to seek planning consent to develop the property or arrange for the letting or sale if it is deemed to be the best way of repaying some of the debt.


If any agreements with creditors are needed a receiver will deal with that aspect while ensuring the owner or borrower is repaid any money that is left over once debts and costs are paid.


In situations where the property requires loan repayment, these issues will be solved prior to the completion of the receivership.


By Phil Smith


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