Vendor refusing to voluntary register property

Chickenmclulu

Hello,


I would be really grateful if anyone could offer some advice re a house purchase.


We are in the process of buying a property and the vendor has lived there for 50ish years, so as such the property has not been registered with the Land Registry. Although this is not a huge problem in itself, and I understand we could register after the sale completes, my solicitor has informed me that there is an un-receipted charge against the property as the vendor has no official proof the mortgage was ever paid off.


The vendor does have the deeds for the property but my solicitor has requested that they apply for voluntary first registration to counter any potential issues with the un-receipted charge. The problem is the vendor's solicitor is refusing to register the property as they feel it will take too long and the vender is desperate to complete the sale asap.


Is my solicitor being over cautious? Could we proceed without the registration (I know we would then need to do this one the sale completes) or would it be an unwise thing to do? There is talk of a possible indemnity insurance to cover any potential issues but both solicitors seem to be at a standstill with no one willing to compromise.


Any help would be very much appreciated!

mark55man

cant help I'm afraid OP - other than to note his refusal to do something and his desire to move quickly are incompatible.

Other posters may have other ideas, but would it be enough for you for the vendor to start the process, and you can then push on as ther is always plenty of other things to delay


maybe even the fact that they are willing to start - ie have nothing to hide would be good enough to give you cionfidence


I am not a lawyer !!!

KL0001

The property we are buying is unregistered, we!!!8217;ve been told by our solicitor it can take up to 9 months to register the property for the 1st time. So this could cause quite a delay if you wanted it done before completion. On the flip side, an indemnity policy is a quick simple fix, that I!!!8217;d persue, if your solicitor feels it is adequate, and try and get the vendor to purchase so the sale can complete quickly. (You can of course purchase the indemnity yourself if the outright vendor refuses).

Tiglet2

The problem is this charge against the property. In all likelihood it has been paid off, but your solicitor is rightly concerned that going ahead without proof could leave you vulnerable. To be honest, I'm in agreement with your solicitor that unless the seller's solicitor provides an undertaking to deal with any problems arising from the charge, your solicitor would be unwilling to make an application for first registration on completion.

silvercar

my solicitor has informed me that there is an un-receipted charge against the property as the vendor has no official proof the mortgage was ever paid off.

where is this registered? Clearly not with Land Registry if the property hasn't ever been registered. So where is the charge noted?

AdrianC

silvercar wrote: »

where is this registered? Clearly not with Land Registry if the property hasn't ever been registered. So where is the charge noted?

Isn't that the whole problem...? That it isn't noted anywhere centrally...?

The deeds show that there is(/was?) a charge, a mortgage, against the property.
The vendor cannot show that the charge no longer applies.
The vendor's (ex-?)lender obviously will not deal directly with the buyer.

Land_Registry

Unregistered interests can be protected on the Land Charges register at the Land Charges Department
If there is a pending land charge and the legal charge (mortgage)has not for example been receipted/discharged then you have a gap in the evidence of title and that should be resolved.

In my experience the seller would apply for first registration and the solicitor would then submit details of your confirmed purchase and ask us to expedite the process.

The current average timescale for a first registration is 49 working days. Yes, that is an average, and yes in the last year that average has been as high as 3 months, so some may take longer but not 9 months as one posts mentions. That would be extreme and I suspect involved problems, perhaps similar to this example, which had to be resolved before it could be registered.

The average timescale is though irrelevant here as it is the submission and then request to expedite that counts. Expedition, if approved, usually means the application is considered within 10 working days. Then it is all about whether it is in order and can be registered.

If the legal charge has not been redeemed then that will need to be resolved. If not, and the title is completed with it being noted you are no further forward re that specific point of course.

So my advice is to ask them to submit it and ask for expedition and go from there - they will know that the legal charge won't just disappear and needs to be dealt with though so suspect that is really the key issue here

martindow

This is probably something and nothing in that a mortgage from 50 years ago is not likely to be for very much. If an indemnity policy is possible maybe that is the simplest answer.


Alternatively, does the vendor know who the mortgage was with? If you could get the lender to write a letter saying that there is no outstanding mortgage that would presumably be sufficient.

Chickenmclulu

Yes exactly:


The deeds show that there is(/was?) a charge, a mortgage, against the property.
The vendor cannot show that the charge no longer applies.
The vendor's (ex-?)lender obviously no longer exists and has changed hands many times so the chances of getting official documentation from them are slim to nil.


I've just spoken to my solicitor and he has advised he is not willing to proceed without the voluntary first registration. I'm inclined to trust him as he even went on to say as he has dealt with a previous sale for us, if this falls through, he wouldn't charge us for the work he has carried out. He feels there could be a potential risk to his firm and our mortgage company could feel we have breached contract if there is an outstanding charge.


It's very disappointing as we were ready to exchange. Unfortunately the vendors solicitors have gone very quiet since they have exhausted all possible arguments not to register. Lets hope they see sense, or we'll have to look for another property. Thankfully we don't have a chain so are in a good position but we do love the house.

davidmcn

Can someone explain the legal principles here - does this mean that if there were a charge holder, they'd be stuffed by the borrower simply registering the property?

AdrianC

davidmcn wrote: »

Can someone explain the legal principles here - does this mean that if there were a charge holder, they'd be stuffed by the borrower simply registering the property?

When the existing owner, the vendor, registers, then the charge will be transferred from the deeds and officially recorded on LR - unless the owner shows that the charge no longer applies. That will then make it impossible to transfer (sell) without the chargeholder showing they no longer have any interest.


What's clearly happened is that they've lost a very important piece of paper over the decades. It happens. The lender can't help, because they don't have the details, either.