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Alex J.
Alex J., Solicitor
Category: Law
Satisfied Customers: 3671
Experience:  Solicitors 2 years plus PQE
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A property being sold has 2 charges registered by a bank one

Customer Question

A property being sold has 2 charges registered by a bank one is for a mortgage the other for some business borrowing that has been redeemed (same bank Lloyds) it has been establish that there are sufficient funds to redeem the borrowing.
can the purchaser proceed and exchange contracts, with the charges in place and are they then removed on an undertaking, a generic over view would be appreciated .
Submitted: 2 years ago.
Category: Law
Expert:  Alex J. replied 2 years ago.
Thank you for your question and welcome.
A charge is discharged using a form DS01 - normally the solicitor for the sellers will hold this with instructions from the bank saying that the form can be filed at the Land Registry when they have received the funds.
The solicitor will then give an undertaking to do this to the buyers solicitor. This is all perfectly safe and is process under written by insurance (professional indemnity).
I look forward to hearing from you.
Kind regards
AJ
Customer: replied 2 years ago.

Thank you for your prompt response, If the charge has provisions attached to it will this prevent the process you have already explained

Expert:  Alex J. replied 2 years ago.
Thank you.
What provisions does it have?
Normally charges just contain additional powers for a receiver.
Kind regards
AJ
Customer: replied 2 years ago.

I am not sure of the exact wording, but if we assume it is a standard bank charge to secure a modest loan facility, in point of fact we are being told that although this charge exists the lending was ported to a regular mortgage facility but the bank left the charge in place. Apparently the bank have authorised the charge to be lifted but we are into day 14 and still the land registry do not have any instruction.

I was hoping that the solicitor would be happy to go ahead and purchase on the usual undertaking, would this be unreasonable.

Many thanks

Expert:  Alex J. replied 2 years ago.
Hi,
Thank you.
Why don't you ask the bank to deliver a DS1 to the solicitor to be held strictly to the order of the bank?
Kind regards
AJ