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  • FIRST POST
    • Two
    • By Two 20th Jul 19, 3:03 PM
    • 9Posts
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    Two
    Possessory Title
    • #1
    • 20th Jul 19, 3:03 PM
    Possessory Title 20th Jul 19 at 3:03 PM
    The vendor of a house I'm looking to buy from only has possessory title as the deeds have been lost.

    What are the potential pitfalls I should be considering before making an offer?
Page 1
    • da_rule
    • By da_rule 20th Jul 19, 3:21 PM
    • 3,402 Posts
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    da_rule
    • #2
    • 20th Jul 19, 3:21 PM
    • #2
    • 20th Jul 19, 3:21 PM
    How long have they had possessory title? If it's 12 years or more then they can apply to upgrade it to absolute.

    At the very least you'll need a missing/defective deeds indemnity policy.

    You'll also need to make sure that any lenders you are talking to are aware early on as they may need to refer it to their underwriters.
    • Two
    • By Two 20th Jul 19, 3:29 PM
    • 9 Posts
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    Two
    • #3
    • 20th Jul 19, 3:29 PM
    • #3
    • 20th Jul 19, 3:29 PM
    How long have they had possessory title? If it's 12 years or more then they can apply to upgrade it to absolute
    Only a few months I believe. House has come onto the market due to the death of the owner.
    • da_rule
    • By da_rule 20th Jul 19, 3:45 PM
    • 3,402 Posts
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    da_rule
    • #4
    • 20th Jul 19, 3:45 PM
    • #4
    • 20th Jul 19, 3:45 PM
    Only a few months I believe. House has come onto the market due to the death of the owner.
    Originally posted by Two
    You just need to make sure that your lender is aware. Also, I would consider a valuation in order to check that what you are paying is close to market value based on this, as most estate agents would just base their valuations on absolute title.

    It may also be that when they clear the house out (if they haven't already) that they'll come across the deeds or a letter from a bank etc which may give a clue as to where the deeds are. If they do turn up you can then apply to upgrade the title.

    In terms of risk, the main ones are that someone produces deeds showing that they own the property or have a right to use or do something on the property. An indemnity policy will cover you for any financial loss.
    • Two
    • By Two 20th Jul 19, 6:38 PM
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    Two
    • #5
    • 20th Jul 19, 6:38 PM
    • #5
    • 20th Jul 19, 6:38 PM
    A question about the indemnity policy. If I were to buy the house for xx amount with possessory title, then did improvements to the house, which was then valued at xx +20k, would the indemnity policy cover the increase in value, and is it for the length of the mortgage?
    • da_rule
    • By da_rule 20th Jul 19, 9:03 PM
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    da_rule
    • #6
    • 20th Jul 19, 9:03 PM
    • #6
    • 20th Jul 19, 9:03 PM
    Indemnity policies can either be for a set amount of time or open ended. Open ended would be best here as even when you do manage to get absolute title this will not stop any other deeds still applying if they turn up. Normally the insured amount is the purchase price with some form of agreed index increase.

    If you want to insure for more then you can, but the seller may only offer to pay for the purchase price element.
    • Two
    • By Two 20th Jul 19, 9:14 PM
    • 9 Posts
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    Two
    • #7
    • 20th Jul 19, 9:14 PM
    • #7
    • 20th Jul 19, 9:14 PM
    Thanks for the info
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