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  • FIRST POST
    • dunroving
    • By dunroving 13th Apr 18, 2:24 PM
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    dunroving
    Title - leasehold vs. freehold?
    • #1
    • 13th Apr 18, 2:24 PM
    Title - leasehold vs. freehold? 13th Apr 18 at 2:24 PM
    I'm in the last throes of solicitor ping-pong before exchanging contracts on the house I am buying.

    One last query is causing a delay, and some consternation on the part of the seller's solicitor. The issue is to do with the freehold/leasehold status of the house.

    Here's what I am seeing with my untrained eye, in the Official copy of register of title.

    Section A (Property Register; "describes the land and estate comprised in the title") it says ..
    [name of the local council]
    1. (16.10.1997) The freehold land shown edged with red on the plan ....
    2. (16.10.1997) The conveyance dated 26 Sept 1997 referred to in the Charges Register was made pursuant to Part V of the Housing Act 1985 and the land has the benefit of and is subject to such easements as are granted and reserved in the said Deed and ... paragraph 2 of Schedule 6 of the said Act.

    Section B: proprietor Register
    This register specifies the class of title and identifies the owner. It contains any entries that affect the right of disposal.
    Title absolute
    1. (16.10.1997) Proprietor: [name of deceased owner of house, and teh address of the house]

    Section C: Charges Register
    This register contains any charges and other matters that affect the land.
    1. (16.10.1997) Lease dated 11 December 1963 to [name of deceased owner and wife] for 99 years from 29 September 1963.
    2. (16.10.1997) A conveyance of the land in this title dated 26 September 1997 between (1) [name of city council] and (2) [name of deceased owner and wife] contains restrictive covenants.

    Buyer's (my)solicitor has asked seller's solicitor to remove the lease from the register.

    Seller's solicitor has reverted to my solicitor, saying (in words of estate agent), "They are questioning the necessity of deleting the lease from the register as it is referred to on many occasions within the freehold."

    I'm waiting to talk this through with my solicitor (they are usually very busy on Fridays), but from what I have described above, is this house freehold, or leasehold?

    I have a "photocopy" of the conveyancing document from the 26th September 1997. The various covenants seem to be about access in order to work on the services (water, etc.). I can't see the word "Freehold" anywhere.

    The first page says the Council (1) are seised (sic) of the premises hereby conveyed for an estate in fee simple subject to the Lease (hereinafter called "the Lease" particulars whereof are set out in the First Schedule* ...
    Then it says the Council (2) "have agreed to sell to the Purchaser [the deceased owner] the said premises subject as aforesaid at the price of (610.00)

    In the next section is a statement that for this payment, the Council conveys to the Purchaser with Limited Title Guarantee all that the premises comprised, etc., etc.

    * the First Schedule describes the details of a 99-year lease that started on the above-described date in 1963, with a rent of 25 p.a.

    So, does this mean the deceased owner bought out the lease?

    As I say, I *am* trying to talk with the solicitor but wondered if anyone on here has experience with a similar situation?
    (Nearly) dunroving
Page 1
    • G_M
    • By G_M 13th Apr 18, 2:44 PM
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    G_M
    • #2
    • 13th Apr 18, 2:44 PM
    • #2
    • 13th Apr 18, 2:44 PM
    Go to the Land Registry site here and enter the address. Which of these appears:

    * freehold Title
    * Leasehold title

    If both, who is named as registered owner of each?

    What you have quoted above is the freehold Title, and presumably that is what you are buying.
    But that does not mean there may not e a leasehold Title as well - indeed it appears there is, created in 1963 for 99 years.

    The owner of that lease can therefore live in the property (till 2062) even if you own the freehold. You would simply be his landlord.

    So
    1) does the lease still exist?
    2) who owns it?
    3) if owned by your seller, is he selling you that lease as well as the freehold?

    Seller's solicitor has reverted to my solicitor, saying (in words of estate agent), "They are questioning the necessity of deleting the lease from the register as it is referred to on many occasions within the freehold."
    Do not waste time discussing this with estate agent - he's not a lawyer. Visit your solicitor and sit down for a proper explanation.


    Note for others: we often see requests on the forum for advice on selecting solicitors. I always recommend using someone local. Yes, you can often find a cheaper solicitor on the internet, or somewhere non-local, and in 90% of cases all goes smoothly and money may be saved.

    But as here, sometimes unexpected issues arise, which are hard to understand. The ability to sit down face-to-face with your conveyancer is invaluable in those cases.
    Last edited by G_M; 13-04-2018 at 2:49 PM.
    • dunroving
    • By dunroving 13th Apr 18, 3:08 PM
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    dunroving
    • #3
    • 13th Apr 18, 3:08 PM
    • #3
    • 13th Apr 18, 3:08 PM
    Go to the Land Registry site here and enter the address. Which of these appears:

    * freehold Title
    * Leasehold title

    If both, who is named as registered owner of each?

    What you have quoted above is the freehold Title, and presumably that is what you are buying.
    But that does not mean there may not e a leasehold Title as well - indeed it appears there is, created in 1963 for 99 years.

    The owner of that lease can therefore live in the property (till 2062) even if you own the freehold. You would simply be his landlord.

    So
    1) does the lease still exist?
    2) who owns it?
    3) if owned by your seller, is he selling you that lease as well as the freehold?

    Do not waste time discussing this with estate agent - he's not a lawyer. Visit your solicitor and sit down for a proper explanation.


    Note for others: we often see requests on the forum for advice on selecting solicitors. I always recommend using someone local. Yes, you can often find a cheaper solicitor on the internet, or somewhere non-local, and in 90% of cases all goes smoothly and money may be saved.

    But as here, sometimes unexpected issues arise, which are hard to understand. The ability to sit down face-to-face with your conveyancer is invaluable in those cases.
    Originally posted by G_M
    Thanks. The link you provided took me to a Portal where I need to Login as a business e-user ... If I used the "Find a property" tab, and search for the address it takes me to a page where I can buy the title register, title plan and flood risk indicator (all of which I already have - I think! - from my solicitor. I clicked on the Specimen Title Register and it looks quite different in format from the "Official copy of register of title" I have from my solicitor, and the specimen has the word Freehold in three places, whereas what I have doesn't use the terms freehold or leasehold anywhere.

    Can you point me in the right direction to access the information you have described above?

    [ETA: I just noticed in the page where I can order the Title register that it says "Tenure" Freehold"]

    Re: the estate agent, she was just giving me the heads-up that this had arisen, so I can keep things moving. We're not trying to resolve or understand the issue between us.

    Also, I am not using an online conveyancer, but a real solicitor (albeit they are not close by), who were recommended by a friend who deals with buying and selling property. Although I prefer face-to-face meetings, it is actually more convenient for me to pick up the phone than to have to make an appointment and travel an hour to get to the closest solicitor (plus I live in Scotland, and the house is in England, so by necessity I have to go with an English solicitor).
    Last edited by dunroving; 13-04-2018 at 3:23 PM.
    (Nearly) dunroving
    • dunroving
    • By dunroving 13th Apr 18, 3:12 PM
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    dunroving
    • #4
    • 13th Apr 18, 3:12 PM
    • #4
    • 13th Apr 18, 3:12 PM
    Update: I used the following site: https://search-property-information.service.gov.uk/ that allows you to find basic ownership information (without having to pay for title, etc.). When I searched for the proeprty, the result page said:

    "Information available to buy

    [address of property]

    There is 1 record (!!!8216;property title!!!8217 for this address"

    [Link]: "What!!!8217;s the difference between freehold and leasehold?"

    "1. Freehold, described as:
    [address of property]"

    - based on your post, it seems maybe there no longer is a leasehold for the property(?)

    When I clicked on the address in the above page (which had a hyperlink) it took me to another page that said:

    "About this property
    You'll get a summary of the information HM Land Registry holds for this property title.

    [Address of property]

    Tenure type: Freehold What does this mean? [hyperlink]

    A property can have both a freehold and a leasehold title. To get a different tenure for this address, [hyperlink] go back and select the one you need."

    When I click on "go back", it takes me back to the previous page, i.e., showing only 1 record.
    Last edited by dunroving; 13-04-2018 at 3:16 PM.
    (Nearly) dunroving
    • G_M
    • By G_M 13th Apr 18, 5:13 PM
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    G_M
    • #5
    • 13th Apr 18, 5:13 PM
    • #5
    • 13th Apr 18, 5:13 PM
    Sorry my link did not take you directly to the right page, but you got there with one further click!

    If the Titles on offer at that address are only Freehold, then that suggests there is no registered Leasehold Title.

    But it is still possible a Lease exists but has never been registered. That would imply the lease has not been bought, sold, mortgaged etc within the last 30+ odd years (ie since introduction of compulsory registration).

    Since the lease was apparantly created in 1963, that is a plausible explanation.

    You also mention a 'deceased owner'. Is this a Probate sale? Was the deceased elderly? If so, he may have bought the lease in 1963, pre-registration, and never sold it since then.
    • dunroving
    • By dunroving 13th Apr 18, 5:23 PM
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    dunroving
    • #6
    • 13th Apr 18, 5:23 PM
    • #6
    • 13th Apr 18, 5:23 PM
    Sorry my link did not take you directly to the right page, but you got there with one further click!

    If the Titles on offer at that address are only Freehold, then that suggests there is no registered Leasehold Title.

    But it is still possible a Lease exists but has never been registered. That would imply the lease has not been bought, sold, mortgaged etc within the last 30+ odd years (ie since introduction of compulsory registration).

    Since the lease was apparantly created in 1963, that is a plausible explanation.

    You also mention a 'deceased owner'. Is this a Probate sale? Was the deceased elderly? If so, he may have bought the lease in 1963, pre-registration, and never sold it since then.
    Originally posted by G_M
    Thanks for your continued help. I didn't realise there may be a lease that wasn't registered.

    The deceased owner lived there with his wife (who predeceased him also in 2017) for quite a long time. The Executor is the deceased's son.

    I'll ask the solicitor what the situation would be if the deceased did own the lease but hasn't registered it ... though I'd have thought their searches would have produced this(?) Regardless, I wonder whether, if such a lease exists but unregistered, and the lease is not explicitly in the sale, the Executor might at some future date be able to have rights over the property?
    (Nearly) dunroving
    • G_M
    • By G_M 13th Apr 18, 5:50 PM
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    G_M
    • #7
    • 13th Apr 18, 5:50 PM
    • #7
    • 13th Apr 18, 5:50 PM

    I'll ask the solicitor what the situation would be if the deceased did own the lease but hasn't registered it ... though I'd have thought their searches would have produced this(?) Regardless, I wonder whether, if such a lease exists but unregistered, and the lease is not explicitly in the sale, the Executor might at some future date be able to have rights over the property?
    Originally posted by dunroving
    Assuming :

    * you are buying the Freehold, and
    * a valid Lease does exists, and
    * you do not also buy the lease, then
    * the current owner of the lease will continue to own it

    In that case, they would naturally be able to occupy the property as leaseholder, until the lease expires in 2062.
    • dunroving
    • By dunroving 13th Apr 18, 6:17 PM
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    dunroving
    • #8
    • 13th Apr 18, 6:17 PM
    • #8
    • 13th Apr 18, 6:17 PM
    OK, that's helpful to know. It may be a lease exists and the executor/son doesn't even know about it (from the interactions we have had via solicitors, he doesn't seem like the sort of person who would conceal this if he knew).

    Still, the law is the law so it's a bit worrying that the situation could theoretically occur.

    Maybe the Executor can sign some document that if the lease does appear at a later date, and belongs to the deceased, either they will waive their rights or transfer to the Freeholder?
    Last edited by dunroving; 13-04-2018 at 6:25 PM.
    (Nearly) dunroving
    • Tiglet2
    • By Tiglet2 13th Apr 18, 7:09 PM
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    Tiglet2
    • #9
    • 13th Apr 18, 7:09 PM
    • #9
    • 13th Apr 18, 7:09 PM
    It does sound likely that this property is an unregistered leasehold title. If the owners had lived in the property for many years and the property was never registered at Land Registry, then I would assume that the owner would have all the deeds and documents in a safe place, maybe lodged with a bank or solicitor or even at the property. In order to register the title, the old deeds would need to be sent to Land Registry for first registration.
    • dunroving
    • By dunroving 13th Apr 18, 10:26 PM
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    dunroving
    Augh that's awkward. I'm pretty sure the executor/son hasn't found anything. So I wonder how the heck it can be found if it's never been registered and the implications if it can't be found - but somehow turns up at some later stage or is raised when I (or my executors) come to sell the house?
    (Nearly) dunroving
    • davidmcn
    • By davidmcn 13th Apr 18, 10:42 PM
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    davidmcn
    Augh that's awkward. I'm pretty sure the executor/son hasn't found anything. So I wonder how the heck it can be found if it's never been registered and the implications if it can't be found - but somehow turns up at some later stage or is raised when I (or my executors) come to sell the house?
    Originally posted by dunroving
    Well, as far as you're concerned, you have a contract with the executors where they sell the property with vacant possession, so they can hardly come back later and claim that they're actually still tenants.
    • dunroving
    • By dunroving 14th Apr 18, 10:36 AM
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    dunroving
    Thanks All, I'll post an update after I have spoken with the solicitor, hopefully on Monday.
    (Nearly) dunroving
    • G_M
    • By G_M 14th Apr 18, 12:27 PM
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    G_M
    Well, as far as you're concerned, you have a contract with the executors where they sell the property with vacant possession, so they can hardly come back later and claim that they're actually still tenants.
    Originally posted by davidmcn
    It's not that simple.

    If the Executors are selling the freehold 'with vacant possession', and later they, or someone else, turns up with a lease and makes a claim to enforce their leasehhld rights

    a) the leaseholder is likely to gain possession, but
    b) the Executers could pssibly be sued for breach of contract.

    Good luck with resolving those legal arguments in less than 12 months and for less than 10K.

    An indemnity Insurance would help - that would at least cover the costs of a leaseholder popping up.

    But are you sure it is the freehold, not the lease, that you are being offered?
    • Doozergirl
    • By Doozergirl 14th Apr 18, 12:29 PM
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    Doozergirl
    Does the house date from 1963? The owner was there from then?

    If it does, then my gut says that it was originally sold to them leasehold in 1963 and the owner then bought the freehold (registered online) in 1997 for 610. Feasible?

    1997 is certainly the time that one would have been wanting to do something about the shortening length of lease - 65 years.
    Last edited by Doozergirl; 14-04-2018 at 12:33 PM.
    Everything that is supposed to be in heaven is already here on earth.
    • dunroving
    • By dunroving 17th Apr 18, 9:47 AM
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    • 572 Thanks
    dunroving
    Does the house date from 1963? The owner was there from then?

    If it does, then my gut says that it was originally sold to them leasehold in 1963 and the owner then bought the freehold (registered online) in 1997 for 610. Feasible?

    1997 is certainly the time that one would have been wanting to do something about the shortening length of lease - 65 years.
    Originally posted by Doozergirl
    Spot on!

    Update, which may be helpful to others who find themselves in this situation: Following further research, I can confirm that the situation is as described by Doozergirl.

    Also as described by others, purchasing the freehold to a property, but not the leasehold, would be problematic. The vendor could potentially sell the leasehold to someone else later, or I as the freeholder may hit problems when I try to sell the house. Clearly *now* is the time to resolve the issue, while the names on the leasehold and freehold are the same.

    From discussions with my (buyer's) solicitor last night, we have two options, possibly three:

    Option 1: Ask the vendor/vendor's solicitor to merge the leasehold and freehold, so that there is only the freehold applying to the property. This is likely to be a very slow process, especially as I believe the original leasehold deeds cannot be found, and it wasn't registered.

    Option 2: Add the leasehold to the sale (i.e., it currently is not on the TR1 form). I am thinking that this may also be time-consuming as the leasehold will need to be registered as part of the sale, and as above, the original leasehold deeds cannot be found.

    The other option (not even sure if it is an option; I have asked my solicitor about it), is whether the sale can proceed on the basis of the freehold, with a legal undertaking by the vendor/vendor's solicitor to register the leasehold and then transfer to me. I would want this to be legally watertight, with agreed timelines, and possibly even a portion of the sale proceeds to be held back until it has been done.

    Does anyone have an opinion on the latter?

    This just goes to show that even a relatively simple purchase (cash buyer, no chain, no time limits, no onward chain, deceased estate) can go wobbly!
    (Nearly) dunroving
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