2025-02-21 28Hse Editor
You’ve probably heard that it’s essential to conduct a property search before signing a Provisional Sale and Purchase Agreement. Sometimes, agents will even provide this information for you. But what exactly can you find in a property search, and why is it so important? Let’s break it down in simple terms.
A property search is a crucial step when buying or renting a property. It helps you confirm if the seller is the legal owner and whether the property has any issues, such as legal disputes or restrictions. The search involves reviewing land records, which are divided into four key sections: property information, ownership details, encumbrances (such as mortgages or legal orders), and pending documents.
The first section, property information, contains basic details about the property, including its address, lot number, reference number, share of the lot, lease term, land grant conditions, and government rent or rates. For those interested in village houses, the lot number and land lease are particularly important. The lot number helps you identify the exact location of the house, while the lease reveals what type of village house it is and whether it can be transferred without paying a land premium.
The second section is ownership details, which show the names of all current and past owners of the property. You can also see how the property is owned, such as whether it’s owned solely or jointly. Additionally, this section reveals the transaction price and registration date of past sales. This information is vital because it allows you to confirm that the seller is the legal owner and has the authority to sell the property.
The third section, which covers encumbrances, is especially important. It includes registered documents that may affect the property, such as mortgages, sale and purchase agreements, tenancy agreements, building orders, and court orders. For example, the mortgage details will tell you which bank issued the mortgage, whether the mortgage has been fully paid off, and whether the owner has taken out a second mortgage or other loans against the property. Building orders and court orders can reveal whether the property has received any notices from the Buildings Department, such as orders to remove illegal structures. This information helps you understand whether the property has unauthorised building work or has been involved in legal disputes.
One term to watch for in the mortgage section is "All Money." This means the loan is not limited to just the mortgage amount—it also covers other debts the borrower owes to the bank, such as credit card bills or personal loans. If the borrower fails to repay any of these debts, the bank has the right to repossess and auction the property to recover the money.
The "All Money" arrangement also makes it easier for the owner to adjust or increase the loan amount. For instance, if the owner wants to take out a second mortgage, they don’t need to sign a new mortgage deed with the bank. Instead, they can simply sign a loan agreement, which doesn’t require a solicitor. If you come across "All Money" in the property search, it’s possible that the owner has already taken out a second mortgage.
The final section, pending documents, lists any contracts or agreements related to the property that have been submitted to the Land Registry but haven’t yet been fully registered. These could include sale agreements or other important documents still being processed.
A property search provides critical information that helps buyers and renters make informed decisions. It ensures you’re aware of the property’s legal status, ownership, and any potential problems before committing to a deal. This article explains what you can learn from a property search. In the next article, we’ll guide you through how to conduct a property search, how much it costs, and what renters and buyers should pay attention to.
Like
