Absolute interest
An unconditional interest in land.
Absolute title
This is the best class of title available in registered land (in freehold or leasehold land). It shows there are no discrepancies over the ownership of the title.
Abstract of title
Documents which prove the title to the land and set out the history of the title. These are only required when the property or land is not registered with the Land Registry.
Adverse possession
If someone takes possession of land, with the intention of excluding the true owner, then the "squatter" acquires title to the land by adverse possession after (usually) 12 years.
Agreement or Contract
The legal document, commonly known as "the Contract" containing details of the price and other conditions of the sale or purchase.
Assignment
A document transferring a right or an interest in a property from one person to another.
Assignee
The person to whom the right or interest in property has been transferred.
Assignor
The person from whom the right or interest in property has been transferred.
Beneficial Owner
The person or persons to receive the proceeds of sale, for their own benefit or use.
Breach of Contract
This is when an agreement is made and someone fails to comply with the terms and conditions contained within. In a property transaction this is where somebody fails to complete the sale or purchase.
Building Regulations
The construction of all properties in the UK together with most structural alterations and in certain cases replacement of windows, installation of central heating systems and electrical works are subject to the Building Regulations. These set out the required standard for such works and compliance with them is supervised by the local council.
Building Regulation Completion Certificate
Once the works have been finished contact should be made with Building Control to arrange for a final inspection to be carried out. This is the certificate which proves that the works have complied with Building Regulations and is a very important document which should be kept safe. This will be required when you come to sell the property.
Caution
An entry on the register of title (for registered land), which protects a minor interest in the land. When a Caution is registered, the owner cannot carry out dealings with the land without the cautioner being notified.
Certificate on report of title
A standard form used by the solicitor to request funds from the mortgage lending bank or building society.
Charge
A mortgage or loan secured against a property. Before a sale or re-mortgage can take place these must be repaid.
Chattel
An item which is not attached to the land and so has not become part of the land. It is distinguished from fixtures by reference to the method and purpose of annexation.
Conservation area
This is an area or district that the Local Authority has decided is of special historical or architectural interest that needs to be preserved. When buying a property within a conservation area special planning requirements apply if you wish to make alterations or repairs and you should always contact the council before carrying out any works for their approval.
Contract
This is the document which sets out the details of the sale such as the price and address of the property and all of the other terms and conditions of the sale that have been agreed. This will be produced by the seller’s solicitors and both the seller and buyer will sign this document.
Conditional Interest
This is an interest in land which only arises or continues as long as certain conditions are fulfilled.
Co-ownership
A situation whereby two or more people own the same parcel of land. Nowadays, the phrase usually refers to a joint tenancy or a tenancy in common (see below for explanation).
Covenant
A promise in a deed which must be complied with during ownership of the property. If the property is sold this covenant will pass to the purchaser.
Covenantee
The party who receives a covenant and so has the benefit of it.
Covenantor
The party who gives a covenant and so carries the burden of it.
Conveyancing
The legal process of transferring ownership of property.
Deed
A formal document that is "executed" by signature, with the signature being formally witnessed.
Deed of Gift
A formal document that transfers ownership of land as a gift or donation. This would mean that no payment for such gift or donation would be payable at any date in the future.
Deed of Variation
If conditions of a lease are incorrect or need altering this is the document that can alter them. Once executed this document stays with the deeds and is registered on the title with the Land Registry.
Deposit
The money that is paid by the buyer when contracts are exchanged. The deposit is a part payment and a gesture of good faith that the buyer will complete the purchase. If the buyer does not go on to complete the purchase, the seller normally keeps the deposit. This is usually 10% of the purchase price. If a smaller deposit is paid and breach of contract occurs then the full 10% will be payable.
Determinable interest
An interest which can be brought to an end when a specified event occurs.
Easement
The right to use a piece of land without owning it, e.g. a right of way over a piece of land or driveway.
Exchange of Contracts
The point in conveyancing where the terms of the transaction become legally binding. At exchange, the buyer becomes the equitable owner of the property.
Fixtures
An item which has become part of the land, having been annexed to it.
Flying freehold
This usually refers to property that is directly above land that belongs to someone else. This is most common in council houses where there is a joint alleyway to the rear gardens and one of the properties has a room above the alleyway.
Forfeiture
A provision in a lease enabling the landlord to bring the lease to an end before its term has expired, because of the tenants default in not complying with the terms of the lease.
Form of consent to Mortgage/Letter of waiver/deed of postponement
Where a property is being purchased with the aid of a mortgage and the buyer/ borrower will not be the only adult occupant of the property, most mortgage lenders insist that any other adult occupants sign a form of consent to mortgage before the mortgage can be completed. This document is an undertaking or promise that the adult occupier will not claim an interest in the property in priority to the mortgage advance in the case of, say, the property being repossessed.
Freehold
This is one of the two legal estates created by the Law of Property Act 1925. It continues for an indefinite period over the property. The owner of a Freehold property owns both the land and the house which is built on it. This interest in land permits the owner to enjoy possession of the property during his life without interference from others and there is no rent to pay to a landlord like in a Leasehold Property.
Indemnity Insurance
Insurance to protect the interest of the client and mortgage lender against any imperfections or interest in a property. These range from a defective title where a document is missing, lack of planning permission and building regulations approvals and search insurance on a re-mortgage.
Joint tenants
The property is jointly owned so that all of the owners have an equal interest in the property. If one of the owners dies, then the survivors will automatically own the whole of the property. See also Tenants in Common
Lease
This is one of the two types of property ownership. The owner of the freehold title grants the lease to the owner of the lease for a specified period of time (e.g. 99 or 123 years). The lease contains all of the issues which the lesee must comply with i.e. to pay the rents on time, keep the flat in good repair and decoration and details of when the lease was issued and when this will expire.
Leasehold property
Property that is occupied under the terms of a lease and a payment of annual ground rent is paid upon which the property is built.
Lessee or Tenant
The person who is granted a lease by the landlord.
Lessor or Landlord
The person who grants a lease to the tenant.
Managing agent
A company or person appointed by the owner of a property (usually a landlord) to act on his behalf, usually in collection of rents or maintenance of the property.
Mortgage advance
The money loaned under a Mortgage.
Mortgage offer
The formal document making an offer of a loan under a mortgage which will say how much the loan is for, the period and amount of repayment and all of the terms and conditions attached to the loan. The Mortgage offer will normally be sent by the lender to the borrower and a copy is also sent to the solicitors.
Mortgage retention
A sum of money retained by the lender until certain conditions have been complied with, for example, they may require that essential repair work is carried out. The remainder of the loan will be released when the work has been completed and proof of this has been provided to the lender. The works are normally recommended by the surveyor who carries out the mortgage survey and the lender then makes it a condition.
Mortgage
A loan secured against a property. If the loan is not repaid, in addition to suing under the covenant to repay, the mortgagee has various rights against the land which can be used to attempt to collect the money owed; for example the mortgagee may be able to take possession of the property and sell it.
Mortgagee
The lender who had made an advance of money under a mortgage. Usually a Bank or Building Society.
Mortgagor
The Borrower is the person taking out the loan.
NHBC
This stands for the National House-Building Council who is the standard setting body and leading warranty and insurance provider for new and newly converted homes in the UK. Their role is to work with the house-building and wider construction industry to provide risk management services that raise the standards of new homes, and to provide consumer protection to new home buyers.
NHBC Insurance Certificate
If a property is built by a builder which constructs the property under the NHBC scheme then the buyer is given. The balance of any unexpired term is automatically transferable to future buyers and a 10-year warranty and insurance policy called 'Buildmark'. This does not cover you for minor defects during the 10 year period however it would cover you for major defects such as subsidence, faulty workmanship etc.
Office copy
An official copy of a document held by a Public Office such as Her Majesty's Land Registry.
PAB
Pending Action in Bankruptcy. This is when there is a pending action to make someone bankrupt.
Party Wall
The wall between two properties that both owners have rights over and responsibilities for.
Party Wall Agreement Notice
Before any proposed works are due to start on a party structure a Party Wall Agreement should be served on the adjoining owner who is affected with the name and address, details of the proposed works and the date on which works are proposed to start. Once the notice has been served the adjoining owner should respond within 14 days. Should they not respond then a dispute has arisen. Please contact us for further information if you are concerned.
Planning Permission
Before any extension or alteration to the rear of the property is carried out you should obtain permission from the Local Authority. This is known as a Planning Permission and sets out what the Council have agreed and the details of what works will be carried out.
Redemption
The repayment of an existing mortgage/loan which is secured over the property.
Redemption Statement
A statement from the mortgage company/lender stating the amount required to pay off a loan on a particular date.
Registration
A method of protecting rights in land by entering them in an official record.
1. In unregistered land, various rights (mostly interests) need protection by registration at the Land Charges Registry.
2. In registered land, the title to the freehold or leasehold land is registered at the Land Registry.
Registered land
Land where the title is registered at Her Majesty's Land Registry. The property would have a unique Title Number.
Restriction
An entry on the register of title (for registered land) to restrict dealings. It is one of the methods of protecting a minor interest in registered land.
Restrictive Covenant
A promise by deed not to do a particular act, for example not to build an extension to a house without first obtaining consent.
Restrictive Covenant Consent
Consent will usually be granted in writing from the person who is granting consent. This should be kept somewhere safe as this will be required when the property is sold.
Searches
We will ask for searches from the Local Authority, the Water Authority and a number of other organisations, so that we can find out everything possible about the property.
Severance
The method by which a joint tenancy is converted into a tenancy in common, for example serving a notice on the other co-owners.
Stamp duty land tax
A tax payable to the Government on the completion of purchase of a property or land. The amount of duty depends on the purchase price of the property.
Successor in title
A subsequent owner of the property.
Sublease
A tenant can grant a sublease for a term which is shorter than the residue of his own leasehold interest.
Telegraphic Transfer
A bank payment directly into another bank account via a CHAPS transfer, with funds clearing on the same day.
Tenants in Common
Each owner owns a precise and specified share of the property and each is able to leave their share of the property by Will to whoever they choose. If the property is held as Tenants in Common, you must be specific about the proportions of ownership. e.g. Owner A is to own 30% and owner B is to own 70% See also Joint Tenants
Tenure
The type of ownership of the property, either freehold or leasehold.
Title deeds
The formal documents that prove who owns the property, however these are less common these days as the Title Information Document and supporting document is all you need to prove ownership of a registered property. If the property is unregistered then these become more important.
Title indemnity policy
An insurance policy that covers the Owner and mortgage lender from any defects in title (up to the limits that will be set out in the policy)
Transfer (TR1)
The document that transfers Title from one owner to another which the Land Registry require to change their records.
Transfer of Equity
The legal process of adding or removing a person from a property and the mortgage.
Unregistered land
Land where the title is not yet registered at Her Majesty's Land Registry.
Vacant Possession
This is when the property is handed over on completion and the property is empty i.e. having no tenant or occupant living at the property. Your lender will require vacant possession to take place on the day of completion.
WOB
Written Order in Bankruptcy – this is when a person is declared bankrupt.
