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Land Registry suffering ludicrous delays

Mortgage Introducer

April 30, 2015

Emma Coffey, business development and sales manager at Blacks Connect, said while straightforward requests for copy entries from the Land Registry pre-offer took “60 seconds”, post-completion registrations were taking anything from a day to four months.

She highlighted four key problem areas where delays were particularly long: transfer of part for example changing boundaries on a property; first registrations; new leases; and lease extensions and variations.

Coffey said: “These aren’t straightforward areas to deal with and I would guess that the back-ups are down to the Land Registry simply not having enough skilled staff to deal with the pick-up in business volumes.”

Figures obtained from the Land Registry show the current average completion time for all new title work is 40 working days. The average completion time for registration applications that do not require a new title to be created, which constitutes the majority of what the Land Registry receives, is less than eight working days.

A statement from the organisation insisted that delays in the processing of registration applications to Land Registry do not hold up property transactions as these take place after sales and mortgages have gone through.

But despite the average figures provided by the Land Registry, Harpal Singh, managing director at Broker Conveyancing, said on first registrations – where the property is either new or has not been registered since 1979 – his firm had seen delays of up to six months.

He said: “You expect this to take a couple of weeks but six months is ludicrous. And I can’t see it getting better – they can’t hire the staff quickly enough and this has to be done correctly from the legal point of view.

“Conveyancers are livid because they’re being chased by the lenders. It’s crazy for the Land Registry to take this long – at what point does that delay become completely unacceptable?”

Kit Thompson, director of bridging at Brightstar Financial, warned that delays of six months could wipe thousands of pounds off developers’ profit or demolish it completely if they planned to flip the property more quickly than this.

Bridging lenders often charge between 0.75% and 1.5% interest a month with some imposing harsh “extension” penalties if borrowers cannot repay the principal when the agreed term finishes.

For property developers taking short-term bridging loans, where buyers might take a loan for four months intending to sell at that point to repay their loan, a six month delay to register the title in their name could pose serious and costly problems.

Thompson said: “We have come across this – the worst case was when a property should have been free of any legal charge but it still showed the previous owner because it hadn’t been registered yet. That stops our client selling and discharging their loan.”

Andrew Hosford, director at Voltaire Financial, said in some cases the Land Registry will prioritise deals that require a charge to be registered quickly.

But he added: “Our client is looking to drawdown a bridging loan against an unencumbered property to increase his equity stake in the purchase of a new multi-million pound property in central London.

“The security property was purchased with his own cash which originated overseas but because of anti-money laundering measures employed by the lender they require the charge against the property to be registered before they release the funds.

“We have now been waiting over a month and with 10 days to go are now panicking that the charge will not be registered in time, which could cause the new purchase to collapse resulting in the client and a number of interested parties losing six figure sums.”

A spokeswoman from the Land Registry said: “Reflecting the general upturn in the property market, our intakes of new leases and transfers of part are at a significantly higher level than in previous years. As we will never compromise on accuracy or quality, this has led to a longer processing time in some cases.”

She added that the organisation was taking steps to reduce delays including: recruiting more operational staff in 2014 and committing to recruit over 100 more this year; introducing targeted overtime resulting in more than 400 staff increasing their working hours – equivalent to 85 additional full time staff; and moving forward with the development of digital services to increase flexibility and shorten timescales.


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