- Alcester Office +44 (0)1789 765522
- Bedford Office +44 (0)1234 400000
- Birmingham, New St. Office +44 (0)121 270 5666
- Birmingham, Newhall St. Office +44 (0)121 703 2606
- Bristol Office +44 (0)1454 275 190
- Cardiff Office +44 (0)29 2240 8700
- Evesham Office +44 (0)1386 425300
- Gatwick Office +44 (0)1293 602890
- Harrow Office +44 (0)20 8907 4366
- Leicester Office +44 (0)116 255 9911
- Leigh Office +44 (0)1942 673311
- Lichfield Office +44 (0)1543 414426
- Luton Office +44 (0)1582 720175
- Northampton Office +44 (0)1604 233 200
- Redditch Office +44 (0)1527 406363
- Solihull Office +44 (0)121 705 2255
- Stopsley Office +44 (0)1582 453 366
- Sutton Coldfield Office +44 (0)121 355 6118
- Tunbridge Wells Office +44 (0)1892 553090
- Walkden Office +44 (0)161 790 1411
- Walsall Office +44 (0)1922 720000
- Warrington Office +44 (0)1925 632267
- Westhoughton Office +44 (0)1942 816515
- Whitefield Office +44 (0)161 796 7920
- Wigan Office +44 (0)1942 244294
Mortgaging Charity Property
Trustees no longer need the consent of the courts or of the Charity Commission to allow land belonging to their charity to be mortgaged, provided that they obtain and consider proper written advice.
Previously, trustees needed the authority of the courts or of the Charity Commission to grant a mortgage over their charity’s land. An exception was where trustees were granting the mortgage as security for the repayment of a specific loan, and had obtained and considered proper written advice.
Under the rules governing mortgages for which consent is not required, trustees must comply with the following requirements:
In the case of a mortgage to secure a loan or grant they must obtain and consider proper advice given to them in writing on whether the proposed loan or grant:
- is necessary for the particular course of action;
- is appropriate in terms of the status of the charity; and
- has interest and other charges that are reasonable and that the charity can afford to pay.
In the case of a mortgage to secure meeting the demands of any other proposed obligation, they must obtain and consider proper advice on whether it is reasonable for them as trustees to take such an action, having regard to the charity’s purposes.
For more information about mortgaging charity property and ensuring that the rules are applied correctly in order that consent is not required, speak to our Charity Team today.