I own 4 terrace properties on one title deed and have contracted to purchase a further 4 on a separate title deedAll eight properties back onto a shared yard area in the form of an horseshoeThe eight are to be refurbished and extended in two phasesThe first 4 (owned)have got planning permission for an extension on the rearAll of the extensions have been built on land owned with the exception of a strip of land approx 1.45m x 3 m which has been built on the shared yard area.The contract entered into to purchase the 2nd 4 properties includes permission to build and extent the properties including the shared landI am re mortgaging the 1st 4 properties and the lender has refused to complete as they are sating I have a defective title.I disagree with this as I have permission to build on the land although at present I do not own it but will do when the 2nd 4 properties have been purchasedAre they right in this assumption and if so what action is required to rectify the situation.My solicitor agrees with my understanding
Province/Country relating to question : co durham
Hi. I agree with your mortgage lender. On your own admission, you do not yet own all of the land on which the extension to the first block of properties has been built. The lender will not and cannot secure a mortgage advance on land that you do not own. The solution would appear to be not to complete the re-mortgage of the first block until after you have completed the purchase of the second block. If you need funds from the re-mortgage of block 1 to complete the purchase of block 2, and on completing the purchase of block 2, you will own the land needed to complete the re-mortgage of block 1, it ought to be possible to complete both transactions on the same day. You may need a temporary bridging facility during the day to complete the transactions, but your solicitor should be able to organise this for you.
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I need to re mortgage to complete the refurbishment of the first block
It is my intention that the 2 title deeds will be split to form 9 new titles (one per house) and one for the rear yard area
Would it be possible to do this now on the 1st blocjk
thus creating 4 new titles
The defective one could be left until the shared land is transfered but will leave 3 with clear title
Hi. yes of course you can split the title for the first block now from a legal viewpoint. However that could create a problem with mortgages in that you would need to arrange with the existing lender to release the three clean titles from its mortgage before you can register them separately and then offer them as security for the re-mortgage. Will they do that? Does the existing lender have enough equity to support its loan in the remaining property, were it to release the other three?
Why cant the new lender agree to split the title on my solicitors undertaking to do it
Alternatively can the seller of the 2nd block agrre to transfer the small piece of land to me or do they have to get their lenders permisiion before
If the seller of the second block has a mortgage over the small piece of land wanted to transfer it to you before completing the main sale, they would need their lender's permission to release it from the security. As you are probably aware, lenders are now extremely cautious and pedantic. If I were acting for a lender, I would not agree to lend on the security of land that you don't own, on the basis of a solicitor's undertaking. Without knowing all the facts and seeing all the documents, it is difficult to suggest practical ways of resolving the problem.
Thnks for that can you suggest any alternative
Would it be possible to lend on the security with an undertaking from my solicitor to split the title into 4 and lend pro rata on the three which would be clear
then release a further amount on the 4th property when title is clear
I already have a retention clause with the lender which is to be released as the work progresses
Waiting for an answer
I have a problem with the land registry title plans I have spoke to the land registry and they have told me a need to write to them with a deed of ratification to adjust the plans attached to the title deeds
Can you tell me where I can get a deed of ratification from to send with the AP1 form and amended plan to the land registry
I have been a Solicitor since 1981 with experience in property, landlord & tenant & wills & probate
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