The Property Factors (Scotland) Act 2011 has shaken up the previously unregulated, and unstructured, property factoring regime in Scotland and has introduced the Property Factor's written services statement. Although the provisions within the Act came into force on 1 October 2012, it seems many organisations and individuals are playing "catch up" with how the changes affect them, including the Property Factor's written services statement.
Written Statement of Services
In addition to the Act itself, property managers must also comply with the Code of Conduct. Section 1 of the Code is the requirement for factors to issue a 'written statement of services' to homeowners within any property that they factor.
This statement must set out in a 'clear and transparent way':
- The basis on which an individual or organisation is authorised to act as a factor
- The services they provide in this role and what specific share of costs the owner is liable for
- Information regarding financial and charging arrangements, such as how payments by homeowners are collected
- How complaints and enquiries will be dealt with
- A declaration of any financial or other interests that the factor may have in the land to be managed (for instance, if the factor himself is a homeowner)
- Information on how the factor can be removed if homeowners are dissatisfied with their performance
The statement requires to be exhibited to new homeowners within four weeks of agreeing to provide services and to all factored owners no later than October 2013. The factor must also be prepared to deliver a copy of the written statement within four weeks of receiving a request from a homeowner or the homeowner housing panel.
The information that now requires to be provided by a factor is relatively detailed. Despite being asked in the past to "put that in writing please", it is probably fair to say that the vast majority of factors have not been providing such information to homeowners whilst performing their roles. The introduction of the Code has led to a significant amount of work for factors as they strive to meet the standards now expected of them. Factors are live to the fact that a breach can ultimately lead to their removal from the property factors register.
If you are a property factor in Scotland, and would like advice on what the Code of Conduct and property factor's written services statement means for you, our property department would be delighted to help.