What is possessory title?
Possessory title is one of several grades of title, or ownership, granted by HM Land Registry under the Land Registration Act 2002. It covers property or land where the registered owner can’t prove that they legally own the property.
For example, possessory title may be granted where the original title deeds have been lost, or where property has been handed down from generation to generation without official title deeds. Possessory title can also be granted following on from adverse possession in cases of ‘squatters rights’.
Is possessory title a problem?
There’s a common saying that ‘possession is nine tenths of the law’. The problem with possessory title is the other tenth. In many cases, possessory title may never be a problem, but there’s always the potential that it might be. Unless you have absolute title, which cannot be challenged (unless it was obtained fraudulently), then there’s always the possibility that someone could challenge your title with a stronger, more valid claim.
What’s more, the original deeds may contain rights and covenants which you won’t know about. If someone finds these deeds, they could have access to your land or the right to graze sheep on it, and you wouldn’t be able to stop them.
Naturally, these possibilities make selling a house with possessory title a problem. Buyers will always be put off by complications, from subsidence to septic tanks, underpinning to damp, and title issues are no different. This means you’ll have less interest in your property and will inevitably have to accept a lower price to compensate for the potential problems.
What can you do about possessory title?
The best way of selling a house with possessory title is to try to upgrade the title before you go to market. The good news is that in many cases it’s possible to upgrade possessory title to absolute title. If you’ve lived in the property for at least 12 years, and continue to live there through your application, then you can apply to upgrade your title quickly and easily. You’ll need to show evidence that no one has ever challenged your title during those 12 years and swear a Statutory Declaration to that effect.
You can also upgrade possessory title to absolute title if you can put right the reason for the lesser title being granted in the first place. For example, if you come across the original title deeds, or you find other evidence to support your claim.
What does it cost to upgrade possessory title?
Applications to upgrade possessory title can be made online for as little as £20 or so. If they meet the criteria of HM Land Registry, and are unchallenged, then absolute title will be granted, making your house much easier to sell.
However, unless the situation is simple and straightforward, for example where you’ve found the original deeds, your costs will inevitably be higher. You may need to employ a solicitor or a land expert to research the title and you may also need to have your Statutory Declaration witnessed. Once the lawyers get their hands in the honey jar, your costs will start to soar.
How to sell a house fast with possessory title
As with all property problems, there’s no point in trying to hide your title issues. They’ll always come to light during the conveyancing process and this will only break the trust of your buyers and potentially squash the sale.
In fact, the best course is to do the exact opposite. To increase your chances of a successful sale, you need to provide as much evidence as you can about why you only have possessory title. Your buyers need to know what they are getting themselves into, and what risks they could face in the future. Unless they’re cash buyers, then their mortgage company will also need to know all this information and more.
An open market sale is still possible, but will inevitably be more difficult and take much longer, as you will have less buyers who are willing to take the risk. You can sell at auction, but you’ll need to accept a far lower asking price and pay significant fees to the auction house.
The quickest and easiest way of selling a house with possessory title is to sell to a cash house buyer. They’ll buy any property, in any condition, under almost any circumstances, including properties without absolute title.
