Splitting title deeds

karxlee

Hi

I'm a Mum looking for some advice for my son so please bear with me...

My Mum and Dad own a commercial property (a shop with living accommodation at the back where they live, and it also has a 3 bed self contained flat upstairs- it has it's own front door),

My son and his girlfriend rent the upstairs flat, the services such at water and gas have not been split, however the electric has.
My Mum and Dad have offered my son the option to buy the flat, however the property only has 1 set of title deeds, so these will need to be split so the upstairs flat has it's own deeds and the downstairs shop and flat have their own deeds.

****I hope you are all still with me******

My question is can the split be done without incurring the outrageous fee's from a solicitor?
If it can how do we do this? and does it need to be done before the sale of the upstairs flat.

Thanks in advance.

G_M

No.

You will need to create a lease and sell that to your son. This would need a solicitor.

I think you would also need to grant a separate lease for the shop, granted to mum&dad. The freehold could remain in the name of mum&dad.

So there would be 3 Titles: 2 leasehold and 1 freehold.

It may be possible for the freehold to comprise the building and the shop, (ie just 1 lease, 1 freehold), but you need a solicitor to advise on this option too.

Is there/will there be a mortgage involved? If so, the respective lender(s) will require solictor(s).

And will money change hands? If so, SDLT may be payable.

On a practical front, you'll need to separate the water & gas (and heating?), plus grant a right of access (via the lease).

It may also need Planning Permission - or is the flat already registered as a domestic residence, with its own Council Tax, in addition to the Business Rates for the shop? Do they have separate postal addresses?

Owain_Moneysaver

It can be done at the time of selling the flat, and while you could do it yourself it's probably easier to use a solicitor. As the work is non-contentious you may find a solicitor is able to handle the conveyance for both buyer and seller.

bobobski

As GM said, except that it is not possible to grant a lease to yourself so mum&dad could not grant a lease to mum&dad (that would be pointless). Freehold stays as it is, mum&dad occupy the shop as freeholder occupiers and new long lease for peppercorn rent is granted to your son. Easy peasy.
Use a solicitor.

karxlee

Hi Everyone,

Thank you so much for all your advice.

To answer a few of your questions the current status is:

The flat upstairs that my son currently rents, was converted with building reg and building approval.

It has it's own off street parking.

There will be a mortgage involved, my son has applied and my Mum and Dad will pay theirs off with the money from the sale.

The upstairs flat has it's own postal address (the shop and downstairs flat doesn't show on the post office as an address)

My son pays council tax on the flat.

Money will change hands - I don't know what SDLT is sorry

We are are really thinking about both flats being freehold rather than lease hold. - is that possible?

Thanks again in advance.

G_M

karxlee wrote: »

The flat upstairs that my son currently rents, was converted with building reg and building approval. Good. Makes it easier

It has it's own off street parking. not sure how that's relevant, but... good

There will be a mortgage involved, my son has applied and my Mum and Dad will pay theirs off with the money from the sale.
so your son's mortgage lender will require a solicitor to act for them. That solicitor might as well act for your son too.
The lender will also require that all searches etc are done, so no 'family shortcuts' possible.

Mum/Dad's lender will appoint a solicitor to remove their Charge from the property. Might as well act for Mum/dad too - especially as they'll need to create a new lease for son.

The upstairs flat has it's own postal address (the shop and downstairs flat doesn't show on the post office as an address). Strange. Should probably get the shop registered with the PO. I believe the Local Authority sets this up. Does the shop pay Business Rates?

My son pays council tax on the flat. Good

Money will change hands - I don't know what SDLT is sorry Stamp Duty Land Tax. See here.

We are are really thinking about both flats being freehold rather than lease hold. - is that possible?
No

..............................................................................

Tom99

The lease on the flat can be at £0 ground rent for 999 years which is as close to freehold as you will get.

You will definatly need a solicitor to draw up the new lease this is not something you can DIY.

G_M

Tom99 wrote: »

The lease on the flat can be at £0 ground rent for 999 years which is as close to freehold as you will get.

You will definatly need a solicitor to draw up the new lease this is not something you can DIY.

No and yes.

No it cannot be for £0 and yes a solicitor.

A lease must have a cost associated with it. That's why 'peppercorn rents' exist. A 45 gm jar of peppercorns will cost £1.00 and might have around 300 year's worth of peppercorns (at 1 per annum).

Geriberi

Similar to this.
I have a house with a shop in Scotland. I want to sell the shop. It has separate electricity.
How much is it approximately to cover legal costs of splitting the title? Does anyone know?
And how long does the process take?

davidmcn

Geriberi wrote: »

Similar to this.
I have a house with a shop in Scotland. I want to sell the shop. It has separate electricity.
How much is it approximately to cover legal costs of splitting the title? Does anyone know?
And how long does the process take?

I would just ask for some quotes. Generally commercial conveyancing is more complex than residential, so more expensive (as it can't go on the some production line).


We're less obsessed in Scotland with registering split titles as a separate preliminary exercise, so that in itself isn't something which will make a big difference to time or costs - it can just be part of the transaction. You will need to figure out the practicalities of how you're splitting the property though (and things like sharing liability for any shared costs).