Buying a piece of land from neighbours

Bluey87

Long story short we bought a house that had been split into two about 40 years ago and the house only has on street parking. So the neighbours have agreed to sell us a piece of land (we have a right of at way over it at the moment as it leads via a path to our front door) They wanted to sell us it all but decided that enough to build a drive way was enough and that it would preserve their privacy, we’re fine with that. 

Questions are:

1. I take it we set the boundary between us and agree on that? How do we then draw it up and give to the land registry? Via our respective solicitors surely? 

2. What are my options for keeping the costs down? 

3. How long should it take? 

4. Is there anything else I should be aware of? 

I have contacted about 4 local law firms. One has come in at £1000 which seems almost as high as the Conveyancing for when we bought the house. 

Any help and experience of the process would be great. 

Thanks. 

greatcrested

Do you or they have mortgages? Any change to the Land Registry Titles will need the lenders' permission.

Both Title Plans will need to be re-drawn - this might require a surveyor, or you may be able to do this yourselves. Ask the LR or your solicitor(s).

If there is no mortgage either side, you could submit the LR applications yourselves using forms

TP1

AP1

ID1

https://www.gov.uk/government/publications/registered-titles-part-transfer-tp1

Is money changing hands? Is it a signficant amount? How much trust is there? If limited £, and or good trust, and no mortgage, you could simply submit the application yourself and transfer the £.

If less trust and significant £, then the 'proper' way would be to have a contract drawn up first (just like any house purchase) and then each side is liable to do their bit (pay/transfer land).

Bluey87

greatcrested said:

Do you or they have mortgages? Any change to the Land Registry Titles will need the lenders' permission.

Both Title Plans will need to be re-drawn - this might require a surveyor, or you may be able to do this yourselves. Ask the LR or your solicitor(s).

If there is no mortgage either side, you could submit the LR applications yourselves using forms

TP1

AP1

ID1

https://www.gov.uk/government/publications/registered-titles-part-transfer-tp1

Is money changing hands? Is it a signficant amount? How much trust is there? If limited £, and or good trust, and no mortgage, you could simply submit the application yourself and transfer the £.

If less trust and significant £, then the 'proper' way would be to have a contract drawn up first (just like any house purchase) and then each side is liable to do their bit (pay/transfer land).

Thanks for your reply. 

Yes we both have mortgages so this was my reasoning for involving solicitors I expected we would need to involve them. 

Once the solicitors get back to me I will know more then. 

davidmcn

Bluey87 said:

I have contacted about 4 local law firms. One has come in at £1000 which seems almost as high as the Conveyancing for when we bought the house.

There's not all that much less work involved, once you take into account that transferring parts of titles (as opposed to the whole of a registered title) can be pretty fiddly, and it's not really a run-of-the-mill transaction they can put onto the same conveyor belt as everything else. Out of interest, what's comprised in the £1000? Is that just the legal fee or have they bunged in some disbursements into that too? Would be over the top to get the usual range of searches etc for this sort of thing.

Bluey87

davidmcn said:

Bluey87 said:

I have contacted about 4 local law firms. One has come in at £1000 which seems almost as high as the Conveyancing for when we bought the house.

There's not all that much less work involved, once you take into account that transferring parts of titles (as opposed to the whole of a registered title) can be pretty fiddly, and it's not really a run-of-the-mill transaction they can put onto the same conveyor belt as everything else. Out of interest, what's comprised in the £1000? Is that just the legal fee or have they bunged in some disbursements into that too? Would be over the top to get the usual range of searches etc for this sort of thing.

As it happens £275 was a local search pack including drainage etc. £4 for a bankruptcy search, only £4 but neither of us are bankrupt! 

davidmcn

Bluey87 said:

davidmcn said:

Bluey87 said:

I have contacted about 4 local law firms. One has come in at £1000 which seems almost as high as the Conveyancing for when we bought the house.

There's not all that much less work involved, once you take into account that transferring parts of titles (as opposed to the whole of a registered title) can be pretty fiddly, and it's not really a run-of-the-mill transaction they can put onto the same conveyor belt as everything else. Out of interest, what's comprised in the £1000? Is that just the legal fee or have they bunged in some disbursements into that too? Would be over the top to get the usual range of searches etc for this sort of thing.

As it happens £275 was a local search pack including drainage etc. £4 for a bankruptcy search, only £4 but neither of us are bankrupt! 

Well you would say that, wouldnt you...that's what the search is to check. But assuming you're not handing over vast amounts of money for the land I think you can take the risk of proceeding without any searches.

greatcrested

Mickey666 said:

If the OP can afford to pay cash for the land (ie won't need to increase your mortgage) then I don't see why their mortgage company needs to be involved because the new piece of land could be registered separately with no need to be included into the existing property title.  I don't know if this would make the conveyancing simpler and therefore cheaper, though it's worth asking.

True, though if the seller has a mortgage then since the value of their property will be (marginally) reduced, their lender will have to be satisfied that the property still provides suficient security for the loan before they'd consent to the sale.

As you say, the buyer could hold the land in a new, seperate Title, thus avoiding involvement of their mortgage lender, but (I believe) there would then be the cost of creating the new Title. Not sure how that compares to the cost of merging it into their existing Title.

davidmcn

Mickey666 said:

If the OP can afford to pay cash for the land (ie won't need to increase your mortgage) then I don't see why their mortgage company needs to be involved because the new piece of land could be registered separately with no need to be included into the existing property title.

It may be a condition of their mortgage that if they acquire neighbouring land, it needs to be added to the lender's existing charge. The lender won't want to end up repossessing only part of the property (with the borrower camping on the remaining bit they still own...).

Mickey666

davidmcn said:

Mickey666 said:

If the OP can afford to pay cash for the land (ie won't need to increase your mortgage) then I don't see why their mortgage company needs to be involved because the new piece of land could be registered separately with no need to be included into the existing property title.

It may be a condition of their mortgage that if they acquire neighbouring land, it needs to be added to the lender's existing charge. The lender won't want to end up repossessing only part of the property (with the borrower camping on the remaining bit they still own...).

Really?  Do you know of any instances where a lender has specified that in their T&Cs?  I can't recall ever reading such a condition in any mortgage I've ever had.  Why on earth would it be any business of the lender what other property I might want to buy?  Besides, what if another property was purchased with another mortgage?  The new lender is hardly likely to want another lender to have a charge on 'their' secured property would they?

davidmcn

Mickey666 said:

davidmcn said:

Mickey666 said:

If the OP can afford to pay cash for the land (ie won't need to increase your mortgage) then I don't see why their mortgage company needs to be involved because the new piece of land could be registered separately with no need to be included into the existing property title.

It may be a condition of their mortgage that if they acquire neighbouring land, it needs to be added to the lender's existing charge. The lender won't want to end up repossessing only part of the property (with the borrower camping on the remaining bit they still own...).

Do you know of any instances where a lender has specified that in their T&Cs?

Yes, I've seen it in lenders' mortgage conditions. It's not a universal condition but certainly exists.

Why on earth would it be any business of the lender what other property I might want to buy?

As I explained above, they won't want to be only able to repossess the "original" property and not the additional part added on later. It would be particularly problematic if for example the borrower has built an extension on the extra bit of land - how do you sell a repossessed property if it doesn't include the kitchen?

Besides, what if another property was purchased with another mortgage?  The new lender is hardly likely to want another lender to have a charge on 'their' secured property would they?

I can't recall any cases where somebody has purchased immediately neighbouring property to be mortgaged with a different lender. I expect it could be sorted out if necessary.

Mickey666

davidmcn said:

Why on earth would it be any business of the lender what other property I might want to buy?

As I explained above, they won't want to be only able to repossess the "original" property and not the additional part added on later. It would be particularly problematic if for example the borrower has built an extension on the extra bit of land - how do you sell a repossessed property if it doesn't include the kitchen?

Hmm, that would certainly be a peculiar scenario.  I suppose PP could be granted to extend a property across two different titles, in my experience this sort of thing has not been explicity checked as part of the planning process.  Can't think why anyone would want to do such a thing though.

My property is split across four titles, but although contiguous they are very distinct from each other, so I was thinking about that sort of scenario rather than an additional piece of land so close that the existing house could be extended on to it.