Limited Title Guarantee

Hutch100uk

Hi, I received this from my solicitor today and not sure what it means. Firstly, do I have to pay these additional fees and what are they for? Secondly, when they say 'rely on your own inspection and survey of the property', do they mean the building survey I had done?

The exact wording is:



Please note that this property is being sold by the Executor / Administrator to the Estate of the legal owner of the property. The property is being sold with a “Limited Title Guarantee”.
This means that as the seller has not lived at the property and has limited or no firsthand knowledge of the property, he sells with a limited knowledge or Limited Title Guarantee.
The seller cannot guarantee that the property is not subject to any financial charges, nor can they guarantee whether there are any rights over the property or give information on what rights there could be. They are unable to confirm whether there are any covenants which may affect the property.

In cases such as this we would always advise that you rely solely upon your own inspection and survey of the property, as the seller cannot be held responsible for any errors made in replying to the enquiries raised.

The additional legal work associated with a Limited Title can be considerable, due to the additional documentation we may need to scrutinise in order to perfect the Title to the premises. Please note that we may need to apply additional fees of £150.00 plus VAT,
depending on whether the sellers’ solicitors have the correct documentation to prove Title.

G_M

There are 2 separate issues.

1) the seller knows nothing about the property as they've never lived in it. They are selling as Executers of the deceased owner's will. So they cannot answer any of the normal questions about the property. - when was the boiler last serviced? is there planning consent for the extension? Any neighbour disputes? etc

Hence the advice to "rely solely upon your own inspection and survey of the property".

2) Limited Title Guarantee means that ownership of the property is not fully guaranteed - often because the property is not registered (or is registered as such with the Land Registry). As the solicitor says, it also means there may be Charges (eg mortgages) and /or legal covenants that are not obvious - hence the extra work involved (and possibly the need for an indemnity insurance to cover you should something come to light after you purchase.)

flashg67

I think you will because you, your solicitor and any mortgage lender will want to check that you will actually own the property you're buying. The costs are the additional work required to check this out due to it being a variance from a 'normal' purchase

xylophone

See post 11 here

https://forums.moneysavingexpert.com/discussion/3261328
re "limited title'.

https://gateleyplc.com/insight/quick-reads/understanding-sale-agreements-full-title-guarantee/

With regard to the enquiries before contract, you will need to satisfy yourself as to these matters because the executor has no or limited knowledge in these areas and can't provide details of such matters as boundary fences/drains/ neighbour disputes etc.

da_rule

Limited title guarantee has nothing to do with proving ownership. Section 2(1) of the Law of Property (Miscellaneous Provisions) Act 1994 there is an implied covenant that the seller has the right to sell (regardless of whether the property is being sold with limited or full title guarantee).

If there was a problem evidencing ownership it would be the class of title (i.e. absolute, possessory, qualified) that would be effected, not the level of guarantee that comes with that title.

Limited guarantee simply means that the seller isn’t aware of any covenants/charges/easements/wayleaves/unregistered leases/overriding interests etc that may burden or benefit the land. It also means that, since the seller became responsible for the land, they haven’t further incumbered the land (unless they’ve declared that they have).

The additional costs may be because the solicitor needs to carry out more in-depth searches, such as a wayleave search with utilities providers etc. Your lender may also have requirements for additional searches and information that is required.

The last part of your solicitors text is somewhat confusing however, as they also seem to suggest that the seller still needs to prove title. By this, I would assume that he means that they have good and marketable title, as obviously a title that it contains lots of restrictions may not actually be marketable. This would also indicate that the land isn’t registered and your solicitor is waiting on certain deeds.

G_M

da_rule wrote: »

Limited title guarantee has nothing to do with proving ownership. Section 2(1) of the Law of Property (Miscellaneous Provisions) Act 1994 there is an implied covenant that the seller has the right to sell (regardless of whether the property is being sold with limited or full title guarantee).

If there was a problem evidencing ownership it would be the class of title (i.e. absolute, possessory, qualified) that would be effected, not the level of guarantee that comes with that title.

.

Thanks for the clarification da_rule.....

Hutch100uk

So the 'Transfer of Freehold Land' document, dated in 1973 shows the transfer from Wimpey homes to 2 individuals who are not the current owners (or deceased owner).
What does this mean?

xylophone

Are you satisfied ( is your solicitor satisfied) that the deceased (currently named as legal owner) had good title to the property?

Is your solicitor satisfied that the executor has probate to the deceased estate and the legal right to sell the property?

The fact that the property was at some point in 1973 owned by "two individuals" before it was (presumably) purchased by the deceased (or even his predecessor in title) seems irrelevant unless you are saying that the deceased did not have good title because the property was actually owned by somebody else?

And surely you are paying your conveyancing solicitor to deal with these matters? Surely that's his job?

davidmcn

xylophone wrote: »

And surely you are paying your conveyancing solicitor to deal with these matters? Surely that's his job?

This. If your solicitor sends you something which you don't understand, then you contact them and ask them to explain it. It's what you're paying them for.

da_rule

The 1973 transfer is likely to be the only transfer that has been produced by the sellers as it is the one that is likely to contain all of the relevant covenants in relation to the land.

It is unusual, once a property has been sold for the first time (i.e. split from the larger parent title), for any of the future transfers to introduce new covenants or easements and as such they do not usually need to be produced.

If the property is registered then the Title Register should show the names of the deceased owners.

Hutch100uk

davidmcn wrote: »

This. If your solicitor sends you something which you don't understand, then you contact them and ask them to explain it. It's what you're paying them for.

Yes of course, but trying to get them to pick up the phone or reply to emails is not easy. Also I don't always know what questions I should be asking them. I appreciate all the advice on here.