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Code of Conduct Review

As you may know, property factoring has been regulated since 2012 and all factors must adhere to the Property Factor Code of Conduct introduced as part of the Property Factors (Scotland) Act 2011.

On 14 July 2021, the Scottish Government published a revised Code of Conduct (Code) for Property Factors setting out the minimum standards that factors should adhere to when carrying out their services.  Compliance with the Code is a legal requirement for all property factors.  The revised Code will replace the current Code that has been in place since October 2012.

A number of changes have been made to the Code, underpinned by the objectives of improved clarity and flexibility for those subject to the Code.  These changes came into effect on 16 August 2021.

An information update was included within our quarterly factoring newsletter on our website and you will find a copy of the new Code here.

Following the revised Code, we have updated our written statement of services in to 2 parts.  Part 1 will outline our obligations and service levels, Part 2 will be a Schedule of Details for customers setting out the specific services at their property, key information about our charges and details of their share of repair.

  •  “Overarching Standards of Practice” are added. These are various standards to which Factors must adhere when carrying out their work, including compliance with all relevant legislation and remaining honest, open and transparent in all dealings with homeowners.
  • Any substantial changes to a WSS must be provided to homeowners at the earliest opportunity within a 3–month period. The current Code allows changes to be provided within a 1–year period. 
  • There is now explicit references to a Factor’s obligation to comply with Data Protection Legislation when handling personal data of clients.
  • Compliance with anti-money laundering legislation and guidance is brought into a Factor’s financial obligations. The current Code is silent on this.
  • A Factor must treat customers in default/arrears: “fairly, with forbearance and due consideration.” A Factor’s debt recovery procedure should advise customers that independent, free, debt advice organisations are available to them. 
  • Factors are to provide an annual insurance statement to each homeowners or a statement within 3 months following a change in insurance provider. 
  • The Revised Code also introduces a new, six page, glossary of terms, again signalling an effort to strengthen the clarity of the code. 

If you have any further questions about the new Code of Conduct and how any of the changes may affect you, please do not hesitate to get in contact.