Announcement deals with issue around liability in programme to enable home buyers to sign mortgage deed digitally
The Government has taken a significant step in moving on HM Land Registry’s plan for a digital mortgage service, with the publication of a departmental minute describing the process and a resulting contingent liability.
Secretary of State for Business, Energy and Industrial Strategy Greg Clark (pictured) made the announcement, saying he will authorise the proposal for a contingent liability for the service – and relating it to the GOV.UK Verify identity assurance platform.
It is normal practice for the relevant department to explain the circumstances with particulars of liability created in a new service, if it goes above £300,000.
The digital mortgage service – which is aimed at improving the process of buying and selling a home – will create some liability risk as it will involve Land Registry certifying the identity of a borrower when that person provides a digital signature in advance of registration.
Clark said the risk of the new liability actually occurring is considered to be low, and pointed to the service’s use of Verify, combined with Land Registry’s independent security processes, as reducing the overall risk of fraud. He added that so far Verify has not identified a single example fraud from 1.25 million accounts having been created, and that any costs incurred from the extension will be covered by Land Registry’s resources.
The digital mortgage service, work on which has been going on for more than two years, will give borrowers the ability to provide a digital rather than written signature to a mortgage deed, and do so without the need for witnesses. This should provide significant time savings and is a major element of Land Registry’s strategy for the next five years.
The agency has said that Verify will confirm the borrower’s identity, following which it will send the person a security message with a code they can use to confirm they are the person signing the deed.
“The digital signature means that the content of the deed cannot be tampered with, or the content changed, without invalidating the signature,” Land Registry’s deputy product manager, Shaun Ewings, said in a blogpost last year. “This gives additional assurance and security for everyone involved in the transaction.”
Image from GOV.UK, Open Government Licence v3.0