Morgages and Charges

Mortgages and Charges

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Overview

Whilst mortgages and charges are technically different ways to secure money, in practice the two terms are used interchangeably, and the modern wording of these documents is such as to blur any distinction between the two. The legal effect of a legal charge or legal mortgage is to secure payment of a loan, usually given for the purpose of purchasing your home.

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Section C of the Title Register

Section C of the Title Register refers to matters that burden the property. This would include mortgages and charges as they burden the property over which they are registered, as well as burdening the mortgagor. This means that the property cannot be sold without paying off the mortgage or charge.

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Register Entries relating to a Mortgage or Charge

C: Charges Register

This register contains any charges and other matters that affect the land.

1 (02.02.2017)   REGISTERED CHARGE dated 27 November 2016.

2 (02.02.2017)   Proprietor: WYKE COMMERCIAL LIMITED (Co. Regn No 121212121212) of Wyke House, Chiltern Road, Cheadle SK8 3HR, tradiing as WYKE MORTGAGES.

In the above example a Legal Charge was executed by the Chargee on 27 Nov 2016, which was registered by the Land Registry on 2 Feb 2017. Note that the Mortgage is described as a Registered Charge.

The above entry was made in the Title Register for a property that is referred to in the A section of the Title Register as:

A: Property Register

This register describes the land and estate comprised in the title.

WEST MIDLANDS : WOLVERHAMPTON

1 (02.09.1998)   The Freehold land shown edged with red on the plan of the above Title filed at the Registy and being 73 James Street, Wolverhampton (WV4 8BH).

Section B of the Register states the name and address of the registered owner of the property. This person is also the mortgagor, i.e. the person in whose favour the loan was made. The date in brackets refers to the date of First Registration of the property.

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Subsequent Mortgages

It is often the case that the owner of a property needs to raise further money to fund, e.g. repairs and improvements to the property. In such a case he may approach another lender, who will also grant a mortgage on the property. A subsequent mortgage is always listed below the first mortgage, as the first mortgage, having been registered first, will already have been registered, and will, unless otherwise stated, take priority in the event of a forced sale. This will ensure that the first mortgage is paid off first.