Remortgage application refused - 2 titles

lisa21

Hi, hoping someone can point me in the right direction.

I purchased my property 4 years ago, as freehold. Over the last few weeks I've been going through an application to remortgage to a new lender, as my current fixed rate (Halifax) has ended and I found a better rate elsewhere (TSB).

Today I chased up the application with TSB who advised me they cannot offer a mortgage as my property has additional land which is leasehold and the remaining lease is less that 50 years.

I have obtained the title details from HM Land Registry and there is no additional land, but there are 2 titles for my property - one freehold, and one leasehold. I assume this is what they are referring to.

From reading online, this seems common however as it's now causing me a problem I have a couple of questions - firstly how do I resolve this? Should both titles have been merged when I purchased the property?

Obviously I wasn't made aware that this could cause issues further down the line when I purchased - should I be speaking to by original solicitor to resolve?

Many thanks in advance for any advice

Mortgage_Adviser

I suggest you start from reviewing your legal paperwork from the time of purshase. Was the issue with the leasehold picked up by the solicitors? Were you informed of it?


You may wan to onvestigate now how do you go about merging all in to one.


If the solicoitors were neglegent you may be able to complain and force them to cover your costs of dealing with the matter.

davidmcn

Can't they just take charges over both the freehold and leasehold interests?

Land_Registry

THe leasehold is only merged into the freehold IF applied for. And there can be reasons why that does not happen when you buy and the conceyancer decides to retain both tenures. For example the leasehold title may enjoy rights over another title but the freehold does not. Keeping the lease in play keeps those rights going as well.

If you want to understand why merger did not take place at the time then the conveyancer who acted for you should be able to assist, providing it was within the last 6/7 years and they are willing to respond

Of not so recent then it might be worth simply asking your current conveyancer, who is acting for you on the new mortgage, to consider the two tenures and advise on whether merger is appropriate. If it is then they can apply to determine the lease and merge it back into the freehold

If it can be determined and merged then the average timescale is around 2 weeks from receipt to it being processed
The ideal scenario would be to merge at same time as remortgaging as I assume the existing mortgage is over both tenures. But I suspect the new lender may not oblige but something to ask.

lisa21

Thanks for the responses. I dug out the paperwork from my purchase (4 years ago) and they do state the property is freehold, no mention of a leasehold.
I've been in touch with the solicitor who acted for me on the purchase and they are investigating.
The solicitor acting on my remortgage has simply said they are awaiting a respinse from the new lender and cannot do anything. They've been saying this for a while.
The delay that this has caused has meant I've now dropped onto my current lender's variable rate, so my payments have increased considerably. I'm in the process of switching to another fixed rate with them (nowhere near as good as TSB's rate, but seems the only option).
Thanks again for alll the replies - I shall see what my original solicitir has to say.