Can I go on the deeds but not on the mortgage?

SDLT_Geek

legseleven192000 wrote: »

So what is the part of the stamp duty payable, is it sat with land registry or is it somewhere else in the line of purchase? I thought land registry determined the stamp duty payable

No, the Land Registry do not determine the SDLT. It is largely a matter of establishing who is the "purchaser" of the property. From what you say this is A alone as A is to be full beneficial owner of the property.

legseleven192000

All of this is making sense, but we are still stuck at the fact the land registry state the below:

"The charge can not be registered on the title as a legal charge. The name of the borrowers must agree with that of all the registered proprietors"
Then they mention practice guide 19 notes. This was in reply to the solicitor asking the question below:
"B and C have a mortgage with HSBC, but are not to be registered proprietors, A is sole proprietor. Could you please confirm it is possible to register A as sole registered proprietor, and also register mortgage in B and Cs name only as indirect security".
Apologies if I am missing anywhere above that explains fully, but what does it take to proove the above land registry reply wrong?

Tom99

[FONT=Verdana, sans-serif]I think both your solicitor and the Land Reg reply have been a little loose with wording which is what is causing the confusion. SDLT Geek explains what I think will happen very well in the above post:

[/FONT]

• [FONT=Verdana, sans-serif]Your relative will be the sole owner[/FONT]
• [FONT=Verdana, sans-serif]You and your relative will both sign the Mortgage Deed[/FONT]
• [FONT=Verdana, sans-serif]You relative will sign as owner of the property and you will sign as Borrower[/FONT]

[FONT=Verdana, sans-serif]
Your relative as sole owner has to sign the mortgage deed otherwise HSBC could not take a charge over the property.

[/FONT] [FONT=Verdana, sans-serif]Your solicitor need to check with HSBC that that is what happens, then re-ask the question of the Land Reg.

[/FONT] [FONT=Verdana, sans-serif]I think the Land Reg were a little loose in their answer in saying the name of the borrowers must agree with the owners whereas they perhaps should have said all owners need to be a party to and sign the mortgage, which as SLDT Geek has explained is not quite the same thing.

[/FONT] [FONT=Verdana, sans-serif]Hopefully re-asking the right question will get the reply you need.[/FONT]

getmore4less

Not sure why the borrowers have to sign the mortgage deed they don't own the security.

They only need to sign something that says they owe a debt for them unsecured as they don't have any security.

Tom99

getmore4less wrote: »

Not sure why the borrowers have to sign the mortgage deed they don't own the security.

They only need to sign something that says they owe a debt for them unsecured as they don't have any security.

[FONT=Verdana, sans-serif]I guess its because as SLDT Geek explained above the mortgage deed is really two documents rolled into one:

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• [FONT=Verdana, sans-serif]A loan agreement with the borrowers undertaking to repay the loan and interest.[/FONT]
• [FONT=Verdana, sans-serif]A legal charge agreement with the property owner agreeing that their property can be used as security for the loan.[/FONT]

SDLT_Geek

Tom99 wrote: »

[FONT=Verdana, sans-serif]I guess its because as SLDT Geek explained above the mortgage deed is really two documents rolled into one:

[/FONT]

• [FONT=Verdana, sans-serif]A loan agreement with the borrowers undertaking to repay the loan and interest.[/FONT]
• [FONT=Verdana, sans-serif]A legal charge agreement with the property owner agreeing that their property can be used as security for the loan.[/FONT]

That is right, it is explained quite well in the HSBC guidance note pasted earlier about how to complete the form of security (Mortgage Deed A2e). Unless the names of the owners as completed on that deed match (or at a push at least include) the names of the owners as shown on the Land Registry title as owners, the security cannot take effect as a legal security on the property for HSBC.

SDLT_Geek

legseleven192000 wrote: »

All of this is making sense, but we are still stuck at the fact the land registry state the below:

"The charge can not be registered on the title as a legal charge. The name of the borrowers must agree with that of all the registered proprietors"
Then they mention practice guide 19 notes. This was in reply to the solicitor asking the question below:
"B and C have a mortgage with HSBC, but are not to be registered proprietors, A is sole proprietor. Could you please confirm it is possible to register A as sole registered proprietor, and also register mortgage in B and Cs name only as indirect security".
Apologies if I am missing anywhere above that explains fully, but what does it take to proove the above land registry reply wrong?

It would have been better if your solicitor had said something like: "B and C are borrowing money from the HSBC but are not to be registered proprietors. A is to be the sole proprietor. Can you please confirm that it is possible to register A as sole registered proprietor and also register the charge in favour of HSBC with B and C shown as borrowers and A as the owner (a third party charge). A draft of the charge, in HSBC's form A2e, is enclosed showing B and C as the borrower and A as the owner".


Hopefully it is not too late and your solicitors can write to that effect between Christmas and New Year. Am I right in saying that the transaction has not happened and this is a case of your solicitors making sure it all works before the transaction goes ahead? Or perhaps get them to look at the HSBC guidance notes for form A2e and they will not need to write to the Land Registry at all.

legseleven192000

SDLT Geek... you are brilliant! I'm literally going to copy and paste this straight to the solicitor. I found research on the a2e form last week and sent it to her. I thought it might have something to do with it. She said it wasn't right and mentioned about the fact the indirect legal charge is only used when 2 go on the house and only 1 on the mortgage loan but one person is on both. Here we don't have that situation. So I guess she didn't look into it enough. They are gone for xmas now and you are right she was enquiring before going ahead so we still have time to get it right.

SDLT_Geek

legseleven192000 wrote: »

She said it wasn't right and mentioned about the fact the indirect legal charge is only used when 2 go on the house and only 1 on the mortgage loan but one person is on both. Here we don't have that situation.

It might be worth you checking direct with HSBC that they are happy to use form A2e in this situation, where A is sole owner and B and C are the borrowers. As a matter of interest, are you dealing direct with HSBC on this or using an intermediary like a mortgage broker? Some earlier postings had said this type of mortgage is only available to Premier Account holders and not through an intermediary.

legseleven192000

Direct to hsbc no brokers. But through the advisor at the branch so I need to get solicitor talking direct to their legal team at head office to see if the A2e form is appropriate. The advisor at branch when asked what the form was just said she couldn't comment due to not being a conveyancer.