Scotland Title Deeds Mortgage Discharge

nrebecca99

Hi, can anyone help please. I've just paid off my mortgage and got a letter from A&L confirming. Yesterday I received all my title deeds with a letter saying due to Scottish law I would need to contact a solicitor to arrange Mortgage Discharge and I should store title deeds in a bank or similar. What exactly is Mortgage Dischange and what will it cost. A&L have already taken a £195 exit fee which I thought covered all administration.

When I phoned them before to ask procedure, I was told that there was no need for solicitor, so am now confused!

Also, is a bank the best place for title deeds, is it necessary?

Thanks

Browntrout_2

Sounds to me they sent you a standard letter regarding mortgage discharge and solicitor and this was confirmed when you called to enquire.

The actual Title Deeds are proof of ownership and are retained by lenders as they have first call on the property if you fail to pay the mortgage. With no mortgage the title is yours.

Although I am unsure if the physical deeds need to be securely stored or can the Land Registry records provide proof of ownership.

£195 for doing what, closing the account and posting your deeds? What did your original contract say this fee was, probably a lot less, if so you can maybe contest this saying you were not informed this fee had been increased!




http://www.scotlandlandregistry.co.uk/

Storing the titles. [SIZE=-1]It normally takes a number of months for the Disposition and Standard Security to be recorded. Once this has been done they will be returned to the purchaser's solicitors, or alternatively a Land Certificate in favour of the purchaser and a Charge certificate in favour of the lender will be issued. The solicitor will send any titles to the lender to be kept safe by them until the mortgage has been repaid. Alternatively, if there is no loan then your solicitor will offer to store the title deeds for you, often free of charge.[/SIZE]

Cas

Hi nrebecca99

When you arranged your mortgage you would have signed a legal document called a Standard Security in order to give A&L a charge over your property (as collateral for your debt). Now that your mortage has been repaid A&L no longer need the charge over your property and for Scottish properties the usual practice is for your solicitor to prepare a Discharge which is then sent to A&L for signature. A&L return the signed document to your solicitor who then registers this with the Land Register. The onus is on the owner of the property and his/her solicitor to obtain the necessary Discharge from the lender.

Scotland's system of land registry is electronic and when you purchased your property your solicitor would have submitted documentation to the Keeper of the Registers in order that this could be reflected in the Land Register. You don't need to be in possession of the title deeds to prove ownership as certified copies can be obtained by your solicitor (on completion of an indemnity) if the originals are lost. However it can be expensive to obtain copies!

It's not mandatory to get the standard security discharged but if you have no debt to A&L do you want them to continue to have a charge over the property? Personally I'd get the discharge done. It's a very simple process (the legal document including signature is only a page long) so I would shop around for a quote (Scottish solcitors will be registered with The Law Society for Scotland - http://www.lawscot.org.uk/find/). It's normal for fees to be quoted "exclusive of VAT and disbursements" (disbursements are things like the Land Register's fee for processing the Discharge) so make sure you're comparing like with like! And it's a separate fee from the one A&L charged which, as Browntrout says, was only to cover A&L's admin costs, ie closing the account and posting out your deeds.

I'm not a solicitor (so please don't treat any of the above as legal advice!)but I used to deal with mortgages for a high street bank for a number of years.

Hope that helps!

jennifernil

When we redeemed our mortgage with Halifax they handled all the paperwork. They charged a fee (possibly£225) which covered everything, we did not need our own solicitor. The deeds were posted out to us, we keep them in a fireproof box. I think most titles are held electronically in Edinburgh now, so paper deeds are not essential.

Big_Nige

Hi Rebecca,

When my mortgage was paid off my lawyer charged £90 + V.A.T. to discharge the deeds. Having the bank/building soc. off the deeds is a good idea, apparently in the event of your death it can cause no end of problems if the property is not discharged. Your lawyer will probably store them for you free of charge or for a nominal fee.

Freebie_Manor

Hi we assisted my mum last year and the dispersment fee was £22.00 her lawyer is holding the deeds FOC. Good Luck

Freebie_Manor

Hello Again RebeccaHaving paid off yout mortgage you may want to check that the Mortgage Exit Fee MEAF A&L charged you is the same as they said it would be on the original mortgage application - check out MEAF on this site for further info.Regards

grahammclaren

Can ayone tell me if I have to employ a solicitor to have my standard security discharged, I have the mortgage redemption paperwork from my lender.
I would have thought it was simply a matter of applying to The land Registry and pay the appropriate fee.

turnwise

Has there been any answer to this?

We recently paid off our mortgage, and the various deeds etc arrived a few weeks later, along with a covering letter telling us that "the standard security, which you signed over your property to secure the mortgage, is still registered at the Land Registry. I strongly recommend that you now take your deeds to a solicitor of your choice so that they can prepare a discharge document to have this removed."

So, is it really such a minefield that we need to pay a solicitor to fill out what must be a pretty standard form???

Is there any way we can do this ourselves?? I've been trawling the internet looking for guidance on this, and there's naff all out there that I've been able to find..

turnwise

I might be getting somewhere....

from the Land Registry public guides..

6 How to discharge a registered charge

When land is registered, Land Registry normally refers to a mortgage as a registered charge (or simply ‘charge'). A discharge is when the entries relating to a charge have been removed from the register once the mortgage has been paid off.
If your property is registered, it is in your interest to remove the entries from the register. In order to do so, you will need proof from the lender that all moneys owing have been paid. There are three main ways in which the lender will provide this evidence.

• Completing a Land Registry form DS1

A form DS1 is a receipt for the moneys paid under the mortgage. The lender may send this form to us directly to ask us to update our records, or the form may be forwarded to you, together with other documents relating to your property.
If you are making the application yourself, you should either:

• complete the details in the form DS2 stating where you would like the updated details issued to, or
• if you do not have a form DS2, enclose a covering letter asking us to update the register and state the address to which you would like us to send the updated details.

Certificate of identity forms ID1 or ID2 are required in respect of all applicants.

• Providing an electronic DS1 (e-DS1)

An e-DS1 is a discharge of registered charge sent by a lender via our portal. Our computer system makes a number of checks and, providing everything is in order, the charge and any associated entries will be cancelled automatically. The lender is informed that the application has been completed.

• Providing an electronic discharge

Some lenders are able to provide us with an electronic discharge. This is a discharge sent by the lender's computer system to ours. Our computer system then cancels the mortgage entries automatically without requiring a separate paper application. Your lender will write to you to confirm that the charge has been removed.
6.1 Sending your application to Land Registry

If you are making your own application for the removal of the charge, it is important that you send it to the correct Land Registry office.
If you already hold a TID, the details of the Land Registry office you should deal with will appear on it. If not, please ring the Land Registry office closest to you, or visit our website. For full details of all Land Registry offices and the areas they serve, see Practice Guide 51 - Areas served by Land Registry Offices. 6.2 What will I receive when the application has been completed?

If you made your own application, when we have completed the removal of the registered charge from our records, we will issue you with an official copy of the register and a TID. These will show the up-to-date records we hold for your title. (See section 3 The title information document for more information regarding the TID.)
If the application to remove the registered charge was made by the lender, or by a conveyancer acting for the lender, then you will not receive any notification or documentation from us unless specifically instructed to do so by the applicant.

kayl

The parts yuo have quoted relate to the removal of a charge from the English Land Registry, rather than the discharge of a standard security from the Scottish Land Register.

Under the English system, when the mortgage is paid off, the lenders use this electronic form to remove the charge. Under the Scottish system, a solicitor needs to be instructed to draft the deed, send it to the lenders for them to sign, and then complete certain forms to allow it to be senbt to the Keeper of the Land Register.

There is no way round this - if it is not done now, it will need to be done when the property is sold, or if you want to secure a loan on it, or if an owner dies. The problem will come if it is not done now and you no longer have the letter showing that the loan has been paid off. I am a solicitor, and have had to sort out this problem for a number of clients, as the lenders are adopting the attitude that you have to prove to them that you don't owe them any money before they will sign, as opposed to them proving that you do owe money!

Average costs are probably £100 plus VAT, with land registration fees of £60 on top of that