Freehold property with unregistered leasehold title

Rainyday81

Hi
We are buying our next home and in a small chain. Our buyers are FTB and we are buying a probate property.

The Grant of Probate has not yet been issued but the vendors solicitor has stated that they are expecting it very shortly. It's all straightforward etc.

Mortgage offer in place, surveys done etc and we are just waiting for the vendors to be granted probate before exchanging.

Well that's what we thought, until we received a letter from our solicitors yesterday stating the following....

"I'd like to advise that the freehold interest was bought by late wife in 2018. They also refer to a lease dated 1964 to late husband, who assume died before wife. I have checked the land registry and it appears that the leasehold interest has not been registered. This means that the property is subject to an unregistered leasehold title. I have requested that the sellers solicitor provide me with the unregistered leasehold title and let me have an amended contract with the leasehold interest"

It goes on to state that upon completion the leasehold and freehold will be transferred into our name.

The solicitor provided the boundaries with the freehold interests - which is correct to our knowledge

What does this all mean? Are we in for a timely delay? Is this a common issue? Can we break chain as concerned that our buyers won't be happy with a lengthy delay?

I'm completely stressed and I feel so physically sick with it all.

Thanks in advance

G_M

Several possibilities.


1) the original 1964 lease will be found. It will be found to have passed to the deceased wife, and following probate, the executers will be able to sell you the lease as well as the freehold. Maybe a few days/weeks delay


2) the original 1964 lease will not be found. It will be unclear who now is the leaseholder. It can therefore not be sold to you, risking the leaseholder popping up in the future and demanding you get out and let him occupy the property. An indemnity insurance policy, usually paid by your vendor, could protect you financially from this (though would notprevent your eviction).


3) the original 1964 lease will be found and either registered (and sold as per 1) above) or rescinded prior to you buying the freehold.


4) the original 1964 lease will be found, and following investigation it will be determined that a 3rd party now owns it (eg the deceased husband sold it ack in the 70s or 80s. Unlikely if the couple continued to live in the property till the wife recently died.


5) the original 1964 lease will not be found and months will pass as attics, previous solicitor's safes, bank safes etc are searched to try to find it.

AdrianC

The most likely of G_M's scenarios is, unfortunately, 2.

When he says "it can therefore not be sold to you", he means the leasehold can't. The freehold still can. Yes, there's a theoretical risk of the situation turning out to be 4 - an indemnity just covers the legal costs arising from that.

You need to take a view on how high you think the risk is of that happening. For me, I'd think it's vanishingly low. But it's not my money on the line.

I don't know if it'd be possible to treat the missing lease as an adverse possession situation. That'd be the direction I think I'd start looking in.

However, one thing's for sure. Unless the lease turns up sharpish (and you're into G_M's situation 1 or 3), this just took a turn into "Might be time to consider walking away" territory.