Legal Jargon

An organisation controlled by central government that maintains a register of properties and their ownership in England and Wales. Approximately 90-95% of residential dwellings are now registered.

The fee payable to the Land Registry to register any change in the property details including a change of ownership or to register the property for the first time.

A search at the Land Registry to verify the owner(s) of a property and other details including previous owners, the price last paid for the property, any charges or debts registered against the property, and any rights of way or access. The search will also usually provide a plan of the property. Ordering a search provides a buyer or lender with a window of 30 days’ protection, during which no changes can be made to the register, and a purchase can be completed without, for example, any new mortgages being registered on the property.

Another word for “lessor” – usually the person who owns the property subject to the lease and who is entitled to receive the ground rent.

Usually (but not necessarily) the freeholder of a property and the person entitled to receive the ground rent from the lessee or tenant.

A document setting out the rights and obligations of the landlord and tenant (lessor and lessee) in the leasehold arrangements.

A form of property ownership where the property is owned for a limited period only, although this can be for anything up to 999 years. The freehold of the property is retained by the freeholder and the leaseholder is usually required to pay them an annual ground rent. All new residential leases now have to be created with a peppercorn rent. When a leasehold property is sold, it is sold with however much of the lease remains, though there are legal mechanisms available now to extend a lease when it becomes too short to be valued by prospective buyers.

Where a lender lends money, such as a mortgage loan, that has to be repaid at some point to a buyer or existing owner and a document is signed by all parties to the arrangement to confirm this. Legal charges are registered against the property at the Land Registry secure the repayment to the lender so that, for example, if the borrower defaulted on their loan repayments or died without having repaid the loan, the lender could recover the value of the loan against the value of the property when it was sold.

When a property is owned as a leasehold, the leaseholder may be required to make a regular payment to the freehold owner. It is literally a payment for renting the ground (land) on which a leasehold property stands. The freeholder is not required to provide any additional services for this payment. The requirement for ground rent is usually created when a freehold piece of land is sold on a long lease or leases. Ground rent is often paid yearly.

A fee that may be charged by a mortgage lender when a borrower borrows a high percentage of the value of a property. This is usually set at loans of 75% or more of the property’s value. The fee is used to insure the lender (but not the borrower) against possible loss arising if the borrower defaults on the mortgage payments and the lender is forced to repossess and sell the property, but the sale proceeds are insufficient to cover the original loan.