limited title guarantee... yet again

karan1 · 9 April 2018 at 9:58PM

Hello Good Evening !

I will be very thankful if someone could help me with below query.

I am purchasing probate property with 'Limited Title Guarantee', with bank mortgage. Property is registered with 'Title Absolute' in the name of deceased person; who has personal representatives, who are selling this property via their solicitors.

from internet i could find Limited title guarantee means 'Under this guarantee, other parties may still have certain rights to the property. In addition, there may be other financial charges that the seller is unaware of'. As per conveyancer / estate agency house is sold with vacant possession. when i viewed propery i could see no one living there.

I am bit worries... as I do Not know...

1) after completion what type of problems could arise while registering property title in my name. what potential or example problems we are talking here ? Could someone just turn after completion (but before registering title in my name) and say this is my property... ?

2) after completion if for some reason (due to limited title guarantee) if property could not be registered in my name with full title, do I still have to keep paying lender loan?

why do bank/lender lend money against limited title guarantee... Bank is asking me for 'full title guarantee with first possession charge'.

I am expecting get some answers from solicitor but for some reason solicitor has not come back yet.. i m getting feeling he would say 'he would not know'.

please could knowledgeables/experts help,

Thanks in advance.
Regards,
Karan

steampowered · 9 April 2018 at 11:21PM

You can read https://www.legislation.gov.uk/ukpga/1994/36/part/I if you want to know what the actual legal difference is between those terms. That is the actual law.

Basically, full title guarantee includes (among other things) a guarantee that the property is free from any third party interests, other than third party interests the seller could not be expected to know about.

If limited title guarantee is given, the seller only guarantees that the seller has not created third party interests themselves while they owned the property. Meaning that, if a third party was to come along after the sale and claim to have some sort of right over the property, you would not have a claim against the seller.

An example of a third party interest would be something like a right of way or a restrictive covenant. Whether this is a real concern or not depends on the history of the property and its location.

A solicitor should know exactly what this means and should be able to advise you. Though if you are using a cheap online conveyancer, you aren't going to get much expert advice from them so now might be the time to use a proper solicitor instead - this is not a situation where you want to be scrimping a few quid to get the cheapest possible service.

I can't see that this would create any difficulties with getting you registered as the owner of the property. But it may cause a problem for your mortgage lender.

Tiglet2 · 9 April 2018 at 11:28PM

It's most likely nothing to worry about. Probate properties are sold with Limited Title Guarantee because the person selling the property is not the Registered Proprietor and therefore will have limited knowledge of the property, of its restrictions and covenants and cannot guarantee that any of these have not been breached. Once completion has taken place you will be registered with Absolute Title.

karan1 · 10 April 2018 at 12:23AM

Thank you both Steampowered & Tiglet2,

Besides right of way or a restrictive covenant,
After completion but before title registration, could some relative of seller turn up with say Gift Deed or something would that also count as - any other interest / third party interest ?
and cause issues in title registration in my name ?

how do lender handle such case ? obviously as buyer I am not capable of paying lender if I can not take charge of house (have good title in my name) ?

Is such scenario possible with limited title guarantee ?

I am using SRA regulated solicitor agency which does conveyancing (through their conveyancing team), but due to circumstances outside my control, I agree, I am still getting cheap service comparable to online conveyancers...

I will be very thankful if you could share your expertise with regards to what how much scope of any other interests could be, which executors can not guarantee under limited title guarantee ?

Thanks again,
Regards,
Karan

Tiglet2 · 10 April 2018 at 7:58AM

Your solicitor will most likely ask for indemnity insurance from the sellers to protect you, which your seller should pay for.

Is it legally safe to buy a property which is subject to covenants? Yes. Most likely, the covenants would be virtually impossible to enforce, even if someone could show title to a property benefitting from them, as yours is burdened by them.

What is constraint of having a limited title guarantee? This is almost the same as full title guarantee, except that the seller is not covenanting for actions of all predecessors.

Your solicitor will check prior title evidence so that you obtain absolute title at HMLR. He is there to guide you.

AdrianC · 10 April 2018 at 8:18AM

It's a probate sale. If you want to speak to the actual previous owner, you're not going to need a solicitor, you're going to need a psychic.

Short of that, you're going to have to take this tiny bit of a risk - or find another property.

steampowered · 10 April 2018 at 9:50AM

I don't think a third party could turn up and claim to be the owner of the property. The seller is the registered owner, after all. You shouldn't have any problems getting registered title.

'Title guarantee' is only about having a claim against the seller is an issue is discovered later. The risk of someone claiming to be the owner isn't much lesser or greater with limited title guarantee compared to any other sale.

The list of third party rights which can take precedent over a transfer of registered title is here: https://www.legislation.gov.uk/ukpga/2002/9/schedule/3

The main one to be careful of is interests of persons in actual occupation. If you've been to see the property and it was empty, then I think you are well protected.

But do take advice from your solicitor.

AdrianC · 10 April 2018 at 9:55AM

steampowered wrote: »

The seller is the registered owner, after all.

I'm not so sure about that. The whole point is that this isn't a property that's registered with LR - as many probate properties aren't, because people who die tend to be elderly, and elderly people tend not to have moved house for decades.

steampowered · 10 April 2018 at 10:58AM

AdrianC wrote: »

I'm not so sure about that. The whole point is that this isn't a property that's registered with LR - as many probate properties aren't, because people who die tend to be elderly, and elderly people tend not to have moved house for decades.

The Op said 'Property is registered with 'Title Absolute' in the name of deceased person'.

I think this means the property is indeed registered with the LR.

betsie · 10 April 2018 at 12:33PM

I!!!8217;m in the same position with a probate House.
My solicitor hasn!!!8217;t raised it as an issue.
In my case one of the deceased children is selling it and they have probate so I am not worried.

PLEASE READ BEFORE POSTING

limited title guarantee... yet again

Comments

Categories

Get our FREE Weekly email full of deals & guides - and it’s spam-free