Glossary of terms
To help you navigate the terminology you may be presented with here is a glossary of terms used in conveyancing.
Conveyancing - Glossary of Terms
A - B
There are classes of title for each piece of registered land whether freehold or leasehold. Absolute title is the most common and best class of title certifying that there is no challenge as far as the Land Registry in England & Wales are concerned regarding the ownership of the interest in land.
Adverse Possession refers generally to longstanding unlawful possession of a property or land. If such possession has continued without any challenge from the legal owner for 12 years or more it may be possible for the occupier to claim an interest in the land and to have this recorded at the Land Registry as Possessory Title.
These are further questions raised by the buyer’s solicitors.
A road maintained by a local authority.
Often used as a word for a contract.
A formal document required to transfer ownership of property to a person entitled to it following the death of the owner.
A conveyancing term to describe the person to who a lease, right or interest is transferred.
The transfer of ownership from one person to another, usually in the context of a leasehold property when the lease is assigned.
Someone appointed formally to act on behalf of another, either generally or for a specific purpose.
A search carried out by the buyer’s solicitor in the period between exchange of contracts and completion to check, on behalf of the buyer’s lender, that the buyer is not bankrupt.
Boundaries define the extent of the property in question and are usually marked with fencing, hedging or walls. They are usually shown on the deeds plan.
BREACH OF CONTRACT
Following exchange of contracts the conveyancing contract is legally binding on the buyer and seller. Should either party fail to complete or otherwise breach the contract that defaulting party will be in breach of contract. It is important to understand that there are different types of breaches, generally depending on the severity, and the remedies available to the innocent party are consequently also linked to the type of breach.
Local Authority regulations that must be complied with when carrying out building works such as replacing windows, electrical works, removing walls.
BUILDING REGULATION INDEMNITY POLICY
A specialised form of indemnity insurance policy used for conveyancing transactions. A one off premium is payable to deal with the situation when a completion certificate has not been obtained from the local authority when a property has been altered.
Once contracts have been exchanged the buyer will be responsible for the new property’s building insurance. This must cover the cost of rebuilding the entire property it if is destroyed. The buyer’s mortgage lender may want to see proof of insurance.
C - D
CERTIFICATE OF TITLE (also known as Report On Title)
A formal certificate provided by the buyer’s solicitor to the mortgage lender stating that the title to the property is good and marketable and which triggers the request for release of the mortgage funds.
A term used to describe a situation where there are a series of buyers and sellers selling properties to one another.
COMMONS REGISTRATION SEARCH
A search at the local authority to check the property is not registered as common land or part of a village green resulting in third party rights over the property (e.g grazing), resulting in the enjoyment of the property being limited.
The moment when the buyer becomes the new owner of the seller’s house and the day the seller must have left the property.
This is the day that ownership of the property passes from the seller to the buyer.
A written calculation of all the receipts and payments due in respect of the transaction.
Land affected by contamination which could arise from a past use of a property (e.g. oil refinery) or by things stored on the property in the past (e.g. petrol station).
A written agreement between the seller and the buyer. The seller’s solicitor prepares the contract. The contract contains information on what has been agreed with regard to the property, the selling price and the names of the parties involved. The seller and the buyer usually sign a separate copy of the contract.
A document transferring ownership of an unregistered property from one person to another.
The legal work needed to buy and sell properties.
A promise contained in a deed or lease that imposes an obligation either to do or not to do something.
DEED OF GIFT
A document transferring the ownership of property from one person to another without any payment being made.
DEED OF GUARANTEE
A document used where one person agrees to be responsible for someone else’s debt or mortgage obligations if that person fails to carry out their own obligations.
The official documents confirming who owns a property which are in the possession of the owner or mortgagees if the property is mortgaged.
The amount payable by the buyer to the seller on exchange of contracts. The standard sum payable on exchange of contracts is 10% of the purchase price. The deposit amount is generally held by the seller’s solicitor.
Expenses incurred by your solicitor in order for the sale or purchase to proceed. Examples can be local authority searches, bank transfer fees, land registry fees.
E - G
The right of a person over another person’s piece of land (e.g. right of way).
A search against a property to check whether there is any record kept to suggest that the property may be affected by the presence of landfill sites, flooding or whether the land may be contaminated.
Usually means the difference between the value of a property and the amount owed to the mortgagee.
EXCHANGE OF CONTRACTS
The formal exchanging of the two parts of the contract when the seller and buyer become legally bound to complete on an agreed date and, in the case of the seller, to move out of the property.
FITTINGS AND CONTENTS FORM
A standard form where the seller sets out all those items in the property which they have agreed to leave as part of the sale price and which is attached to the contract.
The legal word for the ownership of land and usually the property that stands on it where both belong to the owner with no time limit.
FULL TITLE GUARANTEE
The seller of a property must state the guarantee they are prepared to give. Full Title Guarantee is the best guarantee given by the seller that they have the right to sell the land.
This is paid by a lessee to a lessor where a property is leasehold and is usually expressed as a yearly sum.
H - J
HM LAND REGISTRY
The government body that deals with ownership of property and land throughout England and Wales.
To comply with the Money Laundering Regulations and anti-terrorist legislation, in any transaction involving large sums of money, such as conveyancing, your solicitor will be obliged to ask for identification. Usually your passport and a recent utility bill will have to be produced.
INDEX MAP SEARCH
A search at the land registry to see if a property is registered or unregistered.
Indemnity insurance is taken out by all solicitors to cover losses to clients arising from errors or fraud in dealing with their matters.
A form of ownership of a property where on the death of one of the co-owners, the surviving co-owner(s) is (are) entitled to the whole ownership of the property.
L - N
LAND CHARGES SEARCH
A search at the Land Charges Registry to see if a person has any bankruptcy proceedings pending or if the property is unregistered to find out if there are any mortgages or interests registered against the property.
LAND REGISTRY FEE
The fee payable to the Land Registry to register any change affecting the property including a change of ownership.
LAND REGISTRY SEARCH
A search at the Land Registry to check that no undisclosed charges or interests are registered against the property.
LAND REGISTRY SEARCH
A search at the Land Registry to check that no undisclosed charges or interests are registered against the property.
Where a property is leasehold this is the document giving the lessee the rights to possession of the property for the lease term and setting out all rights and obligations.
Where the ownership of property is for a limited period only. For example 99 years or sometimes 2000 years. Possession of the property will be subject to the payment of an annual ground rent.
LEGAL CHARGE (OR MORTGAGE)
A legal document a bank or building society relies on when lending money on property. It gives the lender the power to sell the property if you fail to make the necessary repayments. Following completion the buyer’s solicitor will register the charge against the title and the seller’s solicitor will ensure any charges relating to the seller’s ownership have been paid off and removed from the property title.
This is the document which actually transfers the legal title to the property from one person to another and is signed shortly before completion.
Where a property is leasehold the lessee means the current owner of the leasehold property as opposed to the freeholder or landlord whose interest is subject to the lessees right of occupation until the lease term has come to an end.
This means the landlord or freeholder who owns the freehold title and is entitled to the ground rent under the lease and possession of the property at the end of the lease term.
LIMITED TITLE GUARANTEE
This is the title guarantee given by a seller where, because of their limited knowledge of the property, the full title guarantee cannot be given (e.g. a personal representative of a deceased owner or a mortgagee in possession).
LOCAL AUTHORITY SEARCH
This represents a list of questions about the property which are sent to the local authority. It covers item such as, whether the road serving the property should be maintained by the council, and whether there have been any planning applications on the property.
A document signed by the mortgagor and used to record the terms of the lender’s charge against the property.
The details of the terms upon which the mortgagee is prepared to make the mortgage loan.
The length of time agreed for the repayment of the loan.
Somebody who provides a mortgage (e.g. a bank or building society).
Somebody who takes out a mortgage (a borrower).
A situation where the amount of money you owe on the mortgage on the property is more than the sale price.
A 10 year guarantee by the National House Building Council that a property’s builder will put right serious defects affecting a newly built property.
O - R
Any person who lives at the property but will not be signing the mortgage deed will be asked to consent to the mortgage being taken out and agree to move out if the mortgagee takes possession due to the default of the mortgage.
An official copy of the registered title and title plan issued by the Land Registry. These are usually provided to the buyer’s solicitors by the seller’s solicitor to prove the seller’s title to the property.
A wall owned jointly with a neighbour and repairable at shared expense.
Approval by the local authority to the building or change of use of a property or extension to an existing property.
A road maintained by property owners rather than by the local authority. The property owners need to have rights over it as it is not necessarily a public access.
PROPERTY INFORMATION FORM
This is a questionnaire about the property completed by the sellers. It covers such items as guarantees, neighbour disputes and boundaries.
The repayment of an existing mortgage.
A penalty charged by a mortgagee when you redeem a mortgage within a fixed rate, discounted rate or cashback period.
Property which has already been registered at the Land Registry.
S - T
Stamp duty land tax paid to the government on the purchase of a property over a certain value.
This is a report carried out by a surveyor on the physical state of a property.
SUBJECT TO CONTRACT
The phrase used to indicate that the parties have not yet exchanged contracts.
TENANTS IN COMMON
A form of co-ownership where on the death of the co-owners the remaining owner(s) is (are) not automatically entitled to the deceased’s share in the property. The deceased’s share will pass in accordance with their wishes contained within their Last Will and Testament.
The owner’s right to a property.
These documents firstly act as evidence that the person selling the property actually owns it, and secondly they set out any rights or obligations that affect the property.
TITLE INFORMATION DOCUMENT
Document issued by the Land Registry on completion of an application for registration confirming the ownership of the property and any mortgage.
A dealing with property (e.g. sale or purchase).
A document which transfers ownership of a property from the seller to the buyer. The document will be forwarded to the Land Registry following completion in order for their records to be updated.
TRANSFER OF EQUITY
A document transferring ownership of a share or interest in a property from one person to another.
TREE PRESERVATION ORDER
An order made by the local authority designating a tree or group of trees as protected and requiring the local authority’s permission to lop or fell them.
U - W
Where the title to a property has not previously been registered at the Land Registry and ownership is proved by the production of a complete chain of documents showing successive ownership.
Possession of a property free of the presence of any people, possession or rubbish.
A very simple form of survey designed to establish the market value of the property.
The seller of the property.
WATER AND DRAINAGE SEARCH
Enquiries made of the local water authority to confirm whether or not the property is connected to the mains water supply or a private water supply and whether the property is connected to the public sewer or has a septic tank.
A formal agreement entered into with a property owner to give a service provided (e.g. electricity or telephone company) a right for their pipe or cable to pass through or over the property.
For further information, please contact Stephen Pooley on 01539 720049 and a member of our Commercial department will respond to your enquiry as soon as possible.