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Buying a home?

Glossary of terms used in property sales and purchases

A

Advance Notice

Additional Dwelling Supplement (ADS) 

ALTIS 

Anti-money laundering (AML) 

Appropriation

B

Books of Council and Session 

Breach of Contract 

Bridging loan 

Buildings Insurance 

Burdens

C

Cadastral Map

Certificate of Title

Coal Authority Report 

Chain 

Closing Date 

Common Property 

Community right to buy 

Company and Charges Search 

Concluded Missives/Conclusion of Missives 

Confirmation  

Conservation area 

Consideration

Conveyancing 

Council of Mortgage Lenders (CML) (now UK Finance)

Creditor 

D

Date of Entry 

Date of Settlement 

Deed of Conditions 

Deed of Real Burdens 

Deeds 

Default 

Discharge 

Dispone 

Disposition 

E

Early repayment charge

Encumbrances

Energy Performance Certificate (EPC) 

Engrossment 

Environmental Search

Edinburgh Solicitors Property Centre (ESPC)

Ex adverso

Excambion 

Exchange of Contracts 

Executor

Execution 

Executry 

Exclusion of indemnity/warranty

Extract

F

Factor 

Feu Duty 

Feudal Superior 

Fittings and Fixtures 

First-time Buyer Relief 

Floating charge 

Flood Report 

Formal letter 

Freehold

G

Gazumping  

Gazundering 

Gifted Deposit 

Green Deal

H

Help to Buy New Build Scheme 

Help to Buy ISA 

Heritable Property 

Home Report

I

Indemnity Insurance Policy 

Infeft 

Inhibition 

Insolvency

J

K

Keeper

L

Land and Buildings Transaction Tax 

Land Register 

Lands tribunal for Scotland 

Leasehold 

Legal Report 

Lender 

Letter of Comfort  

Letter of Engagement 

Letter of Undertaking 

Level 3 Plans Report 

Liferent 

Listed Building 

Lender Management Services (LMS)

M

Matrimonial Homes Declaration 

Missives 

Money Laundering 

Mortgage 

Moveables

N

National House Builders Council (NHBC) 

Note of Interest 

Notice of Improvement/Repairs Grant 

Notice of Potential Liability for costs

O

Occupancy Rights 

Offer 

Offer/Mortgage in Principle 

Offer of Loan 

Open viewing

P

Prescription 

Pre-emption 

Pro-indiviso 

Property Enquiry Certificate 

Property Questionnaire

Q

Qualified Acceptance

R

Redemption Statement 

Rescind 

Resile

S

SCOTLIS 

Scottish Standard Clauses  

Single Survey 

Statutory Notice 

Solvency Declaration 

Septic Tank 

Settlement 

Sequestration 

Sasine 

Servitudes 

Suspensive Conditions 

Shared Equity 

Solum 

State for settlement 

Survivorship Clause/Destination 

Stamp Duty  

Sales Schedule

T

Telegraphic Transfer Charge 

Tenement 

Terms of Business 

Title deeds 

Title Number 

Title Sheet 

Tree Preservation Order

U

UK Finance (formerly Council of Mortgage Lenders (CML))

V

Vacant possession 

Vassal 

Vendor

W

Warrandice 

Wayleave

X

Y

Z

 

Advance Notice

This is a notice sent to the Registers of Scotland notifying them that a deed between two parties is shortly to be presented for a particular property. It is sent by the agents acting for the seller or lender and is either recorded in the Register of Sasines where the property is still held on an unregistered title or in the Land Register of Scotland where the title is a registered one. The Registers will protect the deed notified in the Advance Notice by giving preference to the protected deed for a period of 35 days. The deed will specifically be protected from a competing deed being registered and against the insolvency of the granter of the deed during that period. In view of the time limits which apply it is presented as near to the settlement date of a purchase transaction or the date of completion of any re-mortgage.

Additional Dwelling Supplement (ADS)

This is an additional tax levied as part of the Land and Buildings Transaction Tax (LBTT), effectively what is commonly and historically referred to as Stamp Duty. Introduced on 1st April 2016, it is an additional supplement payable upon the purchase of an additional residential property (such as buy-to-let properties and second homes) in Scotland of £40,000 or more. It was increased on 25th January 2019 to 4% of the purchase price and is added to the standard liability for LBTT faced by the purchaser of property. The ownership of an interest in any other property may trigger a liability for ADS and prospective purchasers are recommended to speak to one of our solicitors to confirm whether they might be liable. Further information is available as also available from (link to Revenue Scotland ADS page)

ALTIS

This is a secure online portal for Scottish conveyancing transactions developed by the Edinburgh Solicitors Property Centre (ESPC) in conjunction with the legal profession and linked to industry bodies such as Registers of Scotland and the Council of Mortgage Lenders. It aims to speed up the communication and increase the efficiency of a purchase/sale.

Anti-money laundering (AML)

All professions and financial institutions are obliged through international agreements and regulations to adopt anti-money laundering procedures and checks designed to detect and stop money laundering from taking place (i.e. the transfer of criminally obtained assets). In all cases it will require you to provide proof of identity in the form of photographic and address ID and in a purchase, proof of the source of funds used in any purchase and confirmation as to the source of wealth giving rise to those funds.

Appropriation

This is applicable to the sale of heritable property forming part of the estate in an executry. It arises where the sale price is in excess of the date of death value of the property, where a liability to Capital Gains Tax (CGT) might then arise. A Deed of Appropriation effectively allocates the property to the beneficiaries as individuals before the property is sold allowing the executors to then sell the property as trustees on their behalf. This enables the beneficiaries as individuals to access their own CGT allowance in the tax year of disposal, effectively maximising the number of individual allowances that can be used against any gain. It mitigates or avoids entirely the CGT which might otherwise be due if the property was sold by the executors who are only entitled to one allowance.

B

Books of Council and Session

This is operated by the Registers of Scotland and allows documents, most commonly wills, leases and minutes of agreement, to be publicly registered for safekeeping. The Registers retain the original document and issue an extract registered copy which has the same legal status as the original. This protects against important legal documents being lost, damaged or mislaid.

Breach of Contract

A failure to adhere to or perform an obligation imposed by a binding legal agreement.

The penalty provisions in the contract will provide a mechanism for calculating the financial or other consequences of that breach.

Bridging loan

This is short-term loan to bridge the funding gap pending the arrangement of longer-term finance or receipt of sale funds being used to purchase a new property. A closed bridging loan is used to purchase a new house whilst awaiting the settlement of the sale of an existing property where there are concluded contracts for BOTH sale and purchase but where the date of entry for the purchase is before the sale date. An open ended bridging loan is where funds are advanced to settle a purchase but a sale has yet to be secured. In all cases these loans are difficult to arrange and you should never assume that your bank will provide one.

Buildings Insurance

This is insurance which covers damage to the structure of a property caused by incidences such as fire, theft, storms and flooding. Buildings insurance covers the cost of rebuilding the property if it is damaged or destroyed and is separately assessed having regard to the materials and manner of construction. It is important that the reinstatement figure under the policy reflects the figure confirmed for that purpose by the surveyor and not simply the market value of the property. For new build properties the reinstatement figure is often well below the market value and by contrast the reinstatement figure for historic/listed buildings can be considerably in excess.

Burdens

These are conditions imposed upon land and buildings which are registered against the title to the property. This is a generic term which can cover restrictions on the use to be made of a property, the obligation to maintain the fabric or appearance of common or exclusive parts, the obligation to allow a third party vehicular or pedestrian access or the right to allow a third party to run pipes, drains, cables etcetera through the land. They are contained in the burdens section of a Land Certificate or in the burden writs in an unregistered title still held under the Sasine system. 

C

Cadastral Map

A map of Scotland showing the boundaries and ownership of parcels of land.

Certificate of Title

This is the form submitted by conveyancers to a lender requesting draw down of mortgage/loan funds from a bank/building society. It confirms that the title has been checked and is suitable for mortgage purposes and that all the various conditions imposed by the lender have been complied with.

Coal Authority Report 

This is a report provided by the Coal Authority detailing past, present and future mining activities for a particular property.  The report will disclose if there is risk of subsidence due to unstable ground or the presence of a mine shaft within 20 metres of the property. It is required for properties located in former coal mining areas and the Coal Authority provide a post-code search facility to determine whether such a report is required.

Chain

This is a sequence of linked house purchases and sales where each person in the chain is dependent on a party further down the chain settling the sale of their property or securing mortgage finance to allow the transactions further up the chain to settle. The Scottish system used to pride itself in not having such linked transactions but the reality today is that they are often encountered.

Closing Date

This is the date and time set by the seller’s agent by which all parties wishing to bid for the property should submit their formal offer for consideration. It is effectively a blind auction where a prospective purchaser has to consider the best offer they are prepared to make for the property in the hope that it will be either the highest or otherwise preferred by the seller. The seller is not obliged to accept the highest or indeed any offer at the closing date.

Common Property

This is common property belonging to two or more owners such as a shared access drive, roof etcetera.

Community right to buy

This is a right available to a community body to register an interest in an area of land and to be given the opportunity to buy the land when it comes up for sale. It most often applies in a rural situation.

Company and Charges Search

These are searches against a company to establish the details of the directors, secretaries, returns made and also to obtain details of all outstanding charges affecting the company and any notices lodged in respect of liquidation, administration, receivership or winding up of that company. When a company is selling property then these searches are required to satisfy a purchaser that there is no legal impediment against that company being able to grant a good title.

Concluded Missives/Conclusion of Missives

This is when a legally binding contract between buyer and seller is achieved. The missives are formal letters passing between the solicitor for the buyer and the solicitor for the seller agreeing terms. Once all terms and conditions are agreed, the missives are concluded. Parties are unable to withdraw from concluded missives unless there is agreement to do so or there is a clause in the missives allowing withdrawal (a suspensive condition which has not been satisfied). Please note these contractual letters are NOT signed by the parties themselves but rather their solicitors as their agents and are legally binding on the seller and purchaser notwithstanding.

Confirmation

This is legal document granted by the Sheriff Court in an executry which gives the Executors authority to deal with property belonging to the deceased and to distribute it according to the Will of the deceased or the laws of intestate succession. It is a requirement that this Confirmation is available before the Executors are in a position to grant any title to heritable property to an incoming purchaser.

Conservation area

This covers areas of special architectural or historic interest, where it is desirable to preserve and protect the character or appearance of such an area. Extra planning controls and considerations will apply restricting the work that can be carried out on the property.

Consideration

This is the motivation to the seller to part with title to the property. Most often it is the purchaser price but in matrimonial situations it might be in implement of a separation agreement or for gifts, of the “love, favour and affection” the seller has for the donee.

Conveyancing

This is the term used to describe the process of transferring legal title to a property from one person to another.

Council of Mortgage Lenders (CML) (now UK Finance)

This organisation is an amalgamation of the major mortgage providers in the UK, established to promote a favourable and stable operating environment in the housing and mortgage markets. It originally led to the creation of the CML handbook which is referred to for guidance and rules on what all lenders will expect a conveyancer to cover in examining title to a property and in determining what is an acceptable property to them for lending purposes. The organisation changed its name in July 2017 to UK Finance and the CML Handbook became the UK Finance Mortgage Lenders Handbook. It includes generic conditions which apply to all lenders but also specific requirements individual to the particular lender. These particular conditions must be met before the certificate of title can be submitted to the lender.

Creditor

This is a person or organisation to whom money is owed and in a conveyancing context most often refers to the mortgage lender.

D

Date of Entry

This is the date upon which the purchase/sale will settle and when the purchase price is paid to the Seller in exchange for delivery of the signed disposition transferring title to the purchaser, the keys and vacant possession of the property.

Date of Settlement

The is the date on which settlement is actually effected whether that is the original date of entry contained in the contract or not.

Deed of Conditions

This is the deed which provides a framework of rules, most often in a new development, to preserve the amenity of that development. The deed will contain obligations and conditions of ownership which all owners require to adhere to.

Deed of Real Burdens

This is the deed outlining the burdens which have been imposed on one property/area of land in favour of another or between various owners.  It can cover restrictions on development, maintenance of common parts, access and almost any aspect of interest between owners.

Deeds

This is the generic term covering the legal documents detailing the ownership of an area of land of property or a security, right or burden affecting the property or land. It often includes associated documentation such as timber specialist guarantees, local authority consents for alterations, window/roof guarantees etcetera.   

Default

This is the failure to implement a legal obligation. This is a term commonly used to describe the failure to repay a loan in accordance with the mortgage terms.

Discharge

This is the legal document executed by a lender acknowledging that a loan has been repaid in full. Once recorded or registered it frees the property from the original security in favour of the lender which would otherwise have allowed the lender to have repossessed and sold the property in the event of a default or other failure to meet the mortgage conditions.

Dispone

This word signifies the act required to transfer ownership in land or property.

Disposition

This is the legal document signed by a seller which transfers ownership of a property/area of land to a purchaser. The disposition narrates the major details of the transaction- the seller, the consideration or price, the purchaser, the description of the property and the date of entry.

E

Early repayment charge

This is the additional charge levied by your mortgage lender for redemption of your loan prior to the end of the agreed term. It typically applies to fixed rate loans where the loan is being repaid before the end of the fixed rate period. While some loans may be “portable” (i.e. can be transferred to new property) this should be checked with your lender before you make any decisions in relation to your move.

Encumbrances

An interest or burden over a property which restricts transfer or use.

Energy Performance Certificate (EPC)

This is a report outlining the energy efficiency of a property and it is a legal requirement for a seller to provide such a report regardless of the circumstances surrounding a sale. The general energy efficiency of a property is rated on a scale of A to G (A being the most energy efficient) and the report also identifies how the property’s efficiency might be improved in the future. It forms one of three major components of the Home Report along with the Single Survey and Property Questionnaire and is undoubtedly the most colourful of the three.

Engrossment

This word is used to describe the final version of a legal document which is then ready to sign. In a conveyancing transaction this would cover the disposition in favour of the purchaser or security in favour of a lender.

Environmental Search

This is a report analysing potential environmental risks affecting a property such as contaminated land, flooding, radon and ground stability. In certain circumstances such a search will be a requirement depending on the comments made by the surveyor.

Edinburgh Solicitors Property Centre (ESPC)

The Edinburgh Solicitors Property Centre was formed in 1971 and Balfour+Manson were founding members. It offers an advertising platform for solicitor estate agents, a free advice service, mortgage advice and a lettings service. The ESPC publish a popular property listing and run a full website highlighting the various properties being offered for sale by member firms. It handles the majority of the Edinburgh residential market. It has been advertised over the years as “a super market for property” and should be the first stop for anyone actively looking for property in Edinburgh or surrounding areas.

The full individual property particulars available online should allow prospective purchasers to filter those properties of interest, allowing them to target their actual viewings. For anyone thinking of selling it offers a hugely competitive advertising platform for your property. The ESPC is accessed exclusively through member solicitors.

Ex adverso

This Latin term means "opposite to" and is used to describe the position of land or buildings relative to another property or feature.

Excambion

This is a swap or exchange of land between two parties usually by way of a contact of excambion.

Exchange of Contracts

This is in fact an English term used to describe the point which marks the creation of a binding legal contract. The Scottish equivalent is conclusion of missives and it is this latter term which should be used.

Executor

This is the individual, group of individuals or organisation acting in the administration of a deceased person’s estate. Where they are acting by appointment under a Will they are known as executors-nominate and under the laws of intestacy as executors-dative. In both cases if heritable property is involved then they will require Confirmation to be issued by the court before they have power to grant any title.

Execution

This is the action required to formally sign and/or seal a document in accordance with the appropriate formalities particular to the person or legal entity involved. For an individual it usually means signing in front of an independent adult witness.

Executry

The process of administering or winding up the estate of a deceased by the executor/s according to the terms of the Will or under the laws of intestacy.

Exclusion of indemnity/warranty

When the Keeper of the Registers of Scotland issues a Land Certificate after completion of the first registration of a property under the Land Registration regime it includes a government backed guarantee indemnifying the owner from any loss in the event that title to that property or rights pertaining thereto are challenged in the future.  The Keeper may however exclude indemnity in the Land Certificate where the Keeper has not been satisfied that the underlying title included all of the property or right to which registration has been sought.

Extract

An extract is used to describe a document which has been obtained or “extracted” from a public record such as the Register of Sasines, Land Register, Books of Council and Session, any of the various courts or the Register of Births, Marriages and Deaths.

F

Factor

This is the managing agent usually appointed to organise the maintenance, cleaning, insurance and/or gardening for a group of flatted properties or other type of residential development. They can be appointed voluntarily by a group of owners but most often are appointed under mechanisms included in a Deed of Conditions for a development. The extent of their involvement will depend on the remit from the owners or the scope established by the Deed of Conditions. Their factoring charges will reflect the extent of their involvement.  All property factors must be registered with the Scottish Property Factor Register.

Feu Duty

Feu duty was originally an annual sum paid to a feudal superior but since the abolition of feudal tenure, it is no longer payable. The imposition of a feu duty in a Georgian or Victorian deed may still however be relevant today, if the obligation to maintain a common part such as the roof, was by reference to the proportion that, that feu duty bore to the total feu duty allocated to the individual owners within the block.     

Feudal Superior

This denotes the party from whom land was held under the system of feudal tenure.  Originally all title flowed from the Crown to the initial tier of superiors with the process cascading endlessly down, creating a vast web of over superiorities. A superior could impose restrictions on the actual owner and possessor of the property (the vassal) to adhere to certain conditions and to pay feu duty. This form of tenure was abolished in November 2004.

Fittings and Fixtures

These are any items which are screwed or affixed to the fabric of the property.  If they are actually attached to the property then they become part of the property itself and are not moveable items, though you may view them as such.  An example would be a light fitting which is screwed to the ceiling or an over-mantle mirror which is secured to the actual wall.  Any items falling within this category must be specifically excluded by a seller if it is intended that they be removed.

First- time Buyer Relief

This is a partial relief from the full effects of liability for Land + Buildings Transaction Tax (LBTT) for first time buyers and was introduced in June 2018. It applies to residential property only where the purchaser is a first time buyer and intends to occupy the property as his/her only or main residence. It currently operates by raising the zero tax threshold for first time buyers from £145,000 to £175,000. First time buyers purchasing a property above £175000 will also benefit from an additional element of relief on the amount above the threshold up to a maximum of £600. Click here for First-time buyer relief worked examples (Revenue Scotland)

Floating charge

This is granted by a company to a lender and is a charge for the debt over the assets of the company, both heritable and moveable.  The charge “floats” over the assets of the company.  If the company then sells any of the heritable property, the lender requires to consent to the release of the property from the charge. The existence of such charges is disclosed in the Company and Charges Searches.

Flood Report

This is a report providing an assessment of the risk of flooding, likely flood depths and recommendations to mitigate the impact of a flood event for a particular property. Given the increased occurrence of catastrophic weather events these reports are increasingly requested for properties that might potentially be at greater risk.

Formal letter

This expression is used to identify any of the formal letters making up part of the Missives.

Freehold

This is a common law term used in England to describe the ownership of property as opposed to 'leasehold' where the property reverts to the prior owner after a period of time. Freehold is not a term used in Scotland but it broadly relates to the full rights of ownership of property which apply in Scotland. Leasehold property is rare in Scotland other than in certain parts of the North East. 

G

Gazumping 

This is effectively a seller instructing the acceptance of a higher offer where a verbal or written acceptance in principle has been issued to another party confirming that their offer is acceptable.  In these circumstances a selling solicitor is under strict guidelines issued by the Law Society of Scotland and would require to withdraw from acting.  

Gazundering

This is an attempt by a purchaser to reduce the price otherwise agreed in principle for a reason not directly related to a satisfactory suspensive condition. For example, if an offer is made subject to an independent survey and that valuation is below that contained in the Home Report then there is room for negotiation.  If the attempt to reduce the price is merely to secure a better deal then again the purchasing solicitor operates under strict guidelines issued by the Law Society of Scotland 

Gifted Deposit

This is a gift of a sum of money by a family member to a purchaser to assist them with their deposit in a purchase. Where a purchaser is also obtaining a mortgage then the lender will insist that the donor sign a gifted deposit receipt establishing that it is absolutely a gift and is not masquerading as an informal additional loan.

Green Deal

This was a Government initiative providing homeowners with assistance to pay for energy efficient home improvements.  The Green Deal Scheme was relatively short lived having been introduced in October 2011 and was closed to new applications on 23 July 2015 at which time the UK Government announced they would cease funding the Scheme.  The concept of the Green Deal was to encourage homeowners to make energy efficiency improvements to their properties without having to outlay the costs “upfront”; rather the homeowner made instalment repayments on the Green Deal Grants received from the Scottish Government via their electricity accounts for a period of up to 25 years.  The level of the payments was agreed in advance with the homeowner prior to the commencement of the Green Deal improvement and the Green Deal attached to the property rather than the individual homeowners so that liability to make the repayments transferred to prospective purchasers on the sale of the property concerned.  The justification for this was to ensure that the repayments were made only for so long as the benefit (in theory lower energy costs) were enjoyed by the homeowner.  Also central to the Green Deal Scheme was the principle of the “Golden Rule” being that the homeowner should not repay a sum which exceeded the savings arising on their energy bills from the improvements made to their properties.  This was not however an absolute guarantee and the actual cost to the homeowner may have exceeded their expenditure, for instance where energy consumption increased or if energy prices fell.  Clause 29 of the Scottish Standard Clauses requires a Seller to disclose any ongoing Green Deal Schemes affecting their property to a prospective purchaser.

H

Help to Buy New Build Scheme

This is a government scheme to assist buyers with the purchase of a new build property.  The Government offer interest free equity loans of up to 15% of the value of the new build home. The purchaser must contribute at least 5% of the deposit.

Help to Buy ISA

This is a government scheme to assist first time buyers with saving towards the purchase of a property.  The Government will boost savings with a bonus of 25% of the sum saved. Buyers must save at least £1,600 to receive the minimum help to buy bonus of £400.

Heritable Property

This is a term used to identify property which comprises buildings or land as distinct from moveable property such as cash, shares etc. In many other jurisdictions heritable property equates to real estate.

Home Report

This is report which a Seller requires to provide before marketing a property in Scotland. It was introduced in  2008  and comprises three distinct sections:

  1. The Single Survey – this report is prepared by a surveyor and provides details as to the condition of the property including an assessment of the requirement or otherwise of repairs to certain areas, a market valuation and a re-instatement figure for buildings insurance;

  2. The Energy Performance Certificate (EPC) providing a rating as to the property’s energy efficiency and recommendations as to how this might be improved and

  3. The Property Questionnaire which gives an incoming purchaser useful information on the property’s background including Council Tax banding, utility suppliers, history of past repairs and alterations etcetera (links to each definition)

The Home Report must be provided by the seller when the property is marketed and is not optional.

I

Indemnity Insurance Policy

This is form of insurance which is quite often used as a comparatively inexpensive way of dealing with a title issue or anomaly or the lack of associated documentation which is required for the sale of a property. A one off premium is paid for a policy to protect a purchaser from loss resulting from a legal defect.  A common example is a policy to compensate a purchaser in the event enforcement action is taken by the Local Authority for alteration works that have been carried out without the proper consents.

Infeft

This is an expression used to denote that a person has a recorded or registered title  to heritable property.

Inhibition

This is a form of diligence (enforced legal action) preventing a property owner from selling their property or taking out further lending over the property until money owed to a creditor is paid. As part of the conveyancing process searches are carried out to ensure that such action has not been taken against the parties to a transaction.

Insolvency

Where the liabilities or debts of an individual or organisation are greater than their assets then they are technically insolvent. Where this situation arises then a creditor may legally enforce their rights in a variety of ways which can prevent or frustrate the smooth process of a conveyancing transaction.

J

K

Keeper

The Keeper is correctly known as the Keeper of the Registers of Scotland and is currently Jennifer Henderson. The Keeper is the executive head of the various registers which make up the Registers of Scotland (link to Wikipedia ROS)

L

Land and Buildings Transaction Tax

This is effectively a tax paid to Revenue Scotland by a purchaser on the purchase of a building or land in Scotland. It originates from and replaces the old stamp duty that was paid by a purchaser in the form of stamps as a duty on the document transferring title to such buildings or land. It is calculated by reference to the purchase price as well as your ownership of other heritable property and whether or not you are a first time purchaser. See also First Time Buyer Relief and Additional Dwelling Supplement. To calculate the L+BTT payable you can use Revenue Scotland’s calculator 

Land Register

This is the registers of titles held in Scotland for registered titles under the comparatively new Land Registration regime. It is a map and computer based system.

Lands tribunal for Scotland

This is a tribunal with statutory powers to resolve certain types of dispute involving land or property in Scotland. It is designed to be accessible and user friendly and has authority to interpret ambiguities in titles and to vary any conditions attaching to a particular title.

Leasehold

The ownership of land/property for a fixed period of time only under a long lease is known as leasehold property.  This type of land ownership is comparatively rare in Scotland where ownership is generally held outright under the old feudal system.

Legal Report 

This is a search which checks the legal ownership of a property, any deeds, charges or notices which might have been registered against the property.  It also includes a search in the Register of Inhibitions, Adjudications and Insolvencies to ensure that there are no inhibitions or bankruptcies affecting the parties to the transaction which can impede the transfer of property. The initial legal report is obtained at an early stage and a legal report update obtained just before the settlement of a transaction.

Lender

This term used to describe a person or organisation who lends money, usually a bank or building society. 

Letter of Comfort

This is a letter issued by the Local Authority confirming that they will not take enforcement action in respect of alterations carried out to a property, notwithstanding that alterations have been carried out without the necessary permissions and consents. It usually follows on an inspection of the property and the completion of any necessary remedial work which they have identified.

Letter of Engagement

These are mandatory letters issued by solicitors to their clients upon receiving instructions to act, outlining the work to be carried out, the estimated costs, the identity of the person or persons who will carry out the work and the necessary contacts should matters of concern arise.

Letter of Undertaking

This is a letter issued by one party to another undertaking that a particular obligation will be fulfilled.  It is often used by a seller’s solicitor to confirm that a task will be completed or document will be delivered after settlement of the transaction.

Level 3 Plans Report

Where the property being sold is still held under the old Sasine system or being split off from an existing title registered in the Land Register of Scotland, then a comparison of the title plan is made with the Ordnance Survey (OS) data base as this underpins all the registered titles held in the Land Register. These reports are typically ordered as soon as possible as they very often, particularly in rural areas, give rise to discrepancies between what is actually occupied and the extent of legal ownership in the title. In many cases remedial conveyancing is needed to resolve these discrepancies.

Liferent

This is the legal right to continue to occupy a property or to benefit from its rental during the lifetime of the beneficiary where the residual ownership ultimately moves to another beneficiary on the life rent coming to an end.

Listed Building

Properties can appear on the list of buildings of special architectural or historic interest. Listed buildings are divided into 3 categories - Category A listed (national or international interest), Category B listed (regional importance) and Category C listed (local importance).

Where a property is listed then it can severely impact on the ability of an owner to develop or alter the building where such action is deemed to prejudice the essential character of the building. Appropriate Planning Permission and Listed Buildings consent is required from the Council planning department to carry out such alterations to a listed property. If such consent is NOT required, then this should be confirmed in writing from the department to avoid the matter becoming a potential problem in the future.

This consent is always in addition to the building warrant and completion certificate which is obtained from the building control department of the Council. This deals separately with the technical compliance with the building acts rather than the more aesthetically focused listed building and planning consent.

Lender Management Services (LMS)

This is an online lender portal used by many of the UK's leading mortgage providers to distribute solicitor’s mortgage instructions and loan documents to solicitors and to subsequently communicate with them or monitor progress during a loan transaction.

M

Matrimonial Homes Declaration

This is a declaration confirming that a property is not a matrimonial home to which a spouse or civil partner has rights. Under the Matrimonial Homes (Family Protection) (Scotland) Act 1981 a spouse has the right to occupy the matrimonial home even without title and this has been extended to civil partners under the Civil Partnership Act 2004.  If a property is occupied as a matrimonial/family home, the consent or renunciation of the spouse/civil partner is required. Where an individual is single then a declaration is granted confirming that status on which a third party is entitled to rely.

Missives

These are the formal contractual letters issued by the purchasing and selling solicitors which make up the binding legal contract. They comprise the formal offer submitted on behalf of the purchaser, the qualified acceptance to that offer issued on behalf of the seller and whatever number of further formal letters are needed to reach full agreement when the final formal letter concluding the contract is issued by whichever party has received the penultimate letter.  It is important to appreciate that these formal letters are not actually signed by the parties to the deal themselves but by their solicitors as their agents but nevertheless legally bind the purchaser and seller.

Money Laundering

This is the process of “laundering” or appearing to legitimise money or assets originally obtained through criminal activity so that they appear cleansed of that criminal association.

Mortgage

This is simply a term used to denote the loan of money for the purchase of a heritable property.  The borrower agrees to pay back the loan in repayments usually monthly and usually with interest and to abide by certain mortgage conditions.  The agreement to repay the loan and abide by the mortgage conditions is usually secured against the title to the property, entitling the lender to repossess and sell the property in the event of there being a default in the loan conditions.

Moveables

These are items included in the sale which are capable of being moved. They are an entirely distinct category from heritable fittings and fixtures (link). Sellers should consider which items they intend leaving which might form part of this category e.g. white goods in the kitchen, carpets, curtains etc. Purchasers should always highlight the moveable items they expect to be included in an offer for a property as they can otherwise be overlooked. Always check with your solicitor what category an item might form part of and don’t assume as sometimes the distinctions are not entirely logical.

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National House Builders Council (NHBC)

The National House Builders Council is the UK’s most prominent new home warranty and insurance provider.  Where a builder or developer is registered with the NHBC, they will inspect the property during and after construction. If the property meets the required standard, a 10 year Buildmark guarantee is issued against defective workmanship, though it should be appreciated that the cover offered is limited. The guarantee will be appropriate to the type of property being purchased. For new build properties, lenders will insist that NHBC cover or its equivalent is in place for the first 10 years of a property’s life before they will be prepared to lend. The NHBS operate a comparatively easy online service explaining the cover offered.  www.nhbc.co.uk

Note of Interest

This is formal expression of interest in a property made by a purchaser 's solicitor to the selling estate agent. It does not oblige the purchaser in any way but merely puts the selling agents on notice of their interest in the property. Ordinarily you would expect a selling agent not to recommend that a seller accept an offer for a property where there are competing notes of interest without giving those other parties the opportunity of offering as well.  Where there are a number of notes of interest, the seller may be best advised to set a closing date.

Notice of Improvement/Repairs Grant

Where the Local Authority provide a grant for repairs, adaptations or improvements to a property they often do so on the basis that certain conditions are adhered to (usually for a 5 or 10 year period). A notice is lodged over the title to the property highlighting those conditions and a breach can lead to a situation that the sum advanced is repayable.

Notice of Potential Liability for costs

Where an owner, typically in a block of flats, fails to pay their share of the cost of a common repair, it is possible to lodge a notice against the title to the Property with the Land Registers of Scotland. The details of the notice will be disclosed in the event of the sale of the property and the incoming owner becomes liable for the sum owed. The purchaser will usually refuse to accept liability and will insist that the Seller repay the sums owed at the point of sale. The notices last for three years but can be renewed.

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Occupancy Rights

Under the Matrimonial Homes (Family Protection) (Scotland) Act 1981 a spouse and under the Civil Partnership Act 2004, a civil partner has the right to occupy the matrimonial/ family home even though they do not hold title to the property. These rights are referred to as occupancy rights.

Offer

The offer effectively forms the first formal letter in what will hopefully become concluded missives for the transaction. In most cases it is submitted by the purchaser’s agents on behalf of the purchaser. It contains full details of the purchaser and the price, date of entry and moveable items sought by the purchaser to be included in the deal. It will also contain details of any suspensive conditions and a reference to the Scottish Standard Clauses. (link to guide to Scottish Standard Clauses).

The exception is where a new build property is being purchased from a builder or developer where it is common for an offer to sell to be issued detailing the terms and conditions on which the property is offered for sale.

Offer/Mortgage in Principle

This refers to the initial decision by a mortgage lender which confirms that, based on the information provided to them, they are prepared in principle to lend to a purchaser. Before embarking on a proposed purchase it is advisable to obtain this from at least one lender or have it confirmed by an independent mortgage adviser.  It is not a binding decision and still requires the purchaser to undergo the full mortgage application process which may disclose difficulties, either with the purchaser’s personal circumstances or with the property involved, which leads to a lender refusing to issue an offer of loan. Even where mortgage agreement in principle has been obtained any offer should be made subject to the suspensive condition that it is conditional on a satisfactory offer of loan being issued by the lender.

Offer of Loan

This is the formal mortgage offer issued by a lender confirming it is prepared to lend on certain terms and subject to certain conditions. It follows the formal mortgage application process where the lender checks the purchaser’s personal circumstances, employment and credit history and the valuation, type and condition of the property. All of these details must meet the lending criteria of the institution involved before the offer of loan is issued.

Open viewing

These are fixed periods when potential purchasers can view a property for sale without the necessity of arranging an appointment in advance. In Edinburgh it commonly takes place on Sunday between 2 to 4pm. The opposite is “viewing by appointment” which requires the purchaser to contact the selling agent to arrange the viewing.

Prescription

This refers to the effect that time can have on title to, ancillary rights associated with or obligations affecting land or property. Most commonly in this context title can be perfected through holding an imperfect right to property for a period of 10 years if that title has been held peaceably, openly and without a third party seeking to interrupt that possession through a judicial process.

Rights of access or servitudes for pipes etc. can similarly be acquired by uninterrupted use for the period of positive prescription (where a right is being exercised) even though the title does not contain those rights. Conversely rights in a title can indeed be lost by negative prescription (where the right is not being used) and in both cases this is 20 years.

Prescription can also apply to the lack of listed building consent/planning permission for a listed building if the local authority have not raised objections within 20 years of an alteration having been completed and for an unlisted building within 4 years.

Pre-emption

This is the right contained in a title allowing a party to have the first option to buy back a property in the event of a subsequent sale. It is exercisable only once.

Pro-indiviso

This is the Scottish equivalent of English tenancies in common and refers to the ownership by two or more persons each of a portion of a property as a whole.  The pro indiviso share need not be an equal one.   

Property Enquiry Certificate

This is the search in the local authority records for matters affecting a property such as planning and building applications particular to that property, its listing or location within a conservation area, the existence of statutory notices, its history as regards environmental matters, its connection to mains water and drainage and the adopted status of the roads and pavements giving access to the property. It should be emphasised that it does NOT disclose planning applications submitted by nearby properties and if a prospective purchaser in concerned about possible development then they need to carry out their own personal search of the planning register.

Property Questionnaire

This questionnaire forms one of the three principal parts of the Home Report.  The Questionnaire is completed by the Seller of a property and is signed off by them. The Seller provides details regarding the property’s background including Council Tax banding, utility suppliers, parking arrangements, details of guarantees, alterations and repairs carried out throughout the duration of ownership etcetera.

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Qualified Acceptance

This is the written acceptance issued by the selling solicitors on behalf of the seller to the terms of an offer to purchase. If it contains modifications to the terms of that offer it is deemed to be “qualified” and in turn requires the purchaser to accept such modifications in a further formal letter stating that the bargain is held as concluded before a binding legal contract or concluded missives is achieved. If a seller accepts an offer without modification (which is rare) then that is deemed a de plano (plain) acceptance and the contract is concluded immediately.

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Redemption Statement

This is the statement provided by the lender confirming the amount required to fully repay or redeem a mortgage on a certain date. It will most likely contain a daily rate of interest and include any charges or early repayment penalties. It is usually obtained in a sale prior to conclusion of missives to check that there is sufficient equity in the property to repay the loan.

Rescind

This expression is used to signify that one party to a contract is bringing that party’s future obligations under that contract to an end as a result of a material breach by the other party of their obligations. In this situation the aggrieved party will probably have a claim for breach of contract under the terms of that contract.

Resile

This contrasts with rescinding a contract in that it signifies that one party is withdrawing from a contract lawfully, in the exercise of a right to do so. If there were suspensive conditions in the contract which had not been met and the contract provided for that right, then the party is simply intimating an intention to hold the contract at an end without any penalty being due to or by either party.

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SCOTLIS

This is an online Land Registers portal which is used to search against properties registered in the newer Land Register and older Sasine register and to identify deeds which may be required during the course of a conveyancing action.

Scottish Standard Clauses

This is a standardised set of missive clauses or offer terms which a forum of solicitors in Scotland have agreed is a fair balance of the rights and obligations between both Seller and Purchaser. The clauses outline the responsibilities of both the Seller and Purchaser in a normal conveyancing transaction but can be added to or qualified as required in any particular situation. Its use is intended to avoid large volumes of formal contractual letters being exchanged between the solicitors for either party, as happened in the past. Then a fairly common compromise was arrived at in most transactions and all the Standard Clauses represent is advanced agreement on what that compromise should be. It is also designed to speed the conclusion of missives though in practice this will depend on whether the offer is subject to suspensive conditions. Both Sellers and Purchasers should be familiar with the clauses and read the guide to them (link to SC page).

Single Survey

This is the section of the Home Report which involves a qualified surveyor providing a report on the condition and value of the property. The condition of various aspects of the property are given grades in 3 categories. Category 1 – No immediate repair is needed. Category 2 – Repair or replacement requiring future attention, but estimates are still advised. Category 3 – Urgent repairs or replacement are needed now. Our property team will advise on how a Seller should pre-empt any problems disclosed in the report and advise a purchaser on how such reports should be interpreted.

Statutory Notice

This is a notice served by the Local Authority which identifies a defect, hazard or nuisance in a building that may cause damage, or danger or risk to safety or health. The Council will insist that the owners carry out the necessary repairs within a specified time scale or the Council will carry out the work and will bill the owners thereafter.

Solvency Declaration

This is a sworn declaration signed by a party transferring title to another party confirming that, that party is solvent, their assets exceed their liabilities and that they are not carrying out the transfer to avoid creditors. It is usually required in circumstances where the property is being transferred as a gift.

Septic Tank

When a property is not connected to publicly maintained mains sewage then a septic tank is most often involved in the treatment of sewage and waste water. A septic tank collects and, through biological breakdown, treats that waste before the resultant water drains into a soakaway. A septic tank system can be individual to one property or shared amongst a number of owners. If the septic tank is not located exclusively within the grounds of the property then it is necessary to ensure that all pipes, the tank itself and the soakaway have the necessary servitude rights to be located on a third party’s ground and that rights of access for maintenance are in place as well. All septic tanks require to have consent to discharge from the Scottish Environmental Protection Agency (SEPA).

Settlement

This is the completion of a property transaction.  Settlement is deemed to have taken place when the price has been paid to the seller in exchange for vacant possession of the property, release of keys and delivery of the necessary conveyance documents.

Sequestration

Sequestration, commonly termed Bankruptcy, is the legal process by which you are formally declared insolvent. If a person has been sequestrated they lose the right to dispose of their assets including heritable property.

Sasine

If a property is held on a Sasine title it means it is still recorded in the General Register of Sasines, which is the oldest national public land register in the world, dating back to 1617. This is gradually being replaced by titles being registered in the Land Register of Scotland under the more up to date, map and computer based land registration regime.

Servitudes

This is a generic term covering ancillary rights over a piece of land for the benefit of another. A servitude might be one of access for pedestrian and vehicular traffic, a right of wayleave to run pipes, drains, cables etcetera on, through or over another property or a right of access for maintenance, repair or renewal.

Suspensive Conditions

These are clauses which can be included in an offer for a property which highlight that the offer is entirely conditional on certain material conditions being met. Common examples include:

  1. Subject to survey- this is where the offer is conditional on the purchaser (and possibly their lender) being satisfied with either their own survey report or a refreshed Home Report being provided by the seller.

  2. Subject to mortgage finance- this is where the offer is conditional on the purchaser receiving a satisfactory offer of mortgage from a lender.

  3. Subject to sale- this is where the offer is conditional on the purchaser concluding missives for the sale of their current property.

  4. Subject to planning permission or building consent-this is where the offer is conditional on the purchaser obtaining a specific local authority consent for their intended development or use of the property.

If such clauses are acceptable to a Seller then the contract remains conditional on them being fulfilled otherwise the purchaser would have a right to resile from the contract without penalty.

Shared Equity

This is a scheme whereby the purchaser acquires a percentage of ownership in the property but the remaining percentage is retained, most often by a housing association.  There will be a detailed agreement in place covering the right of the purchaser to acquire additional shares of the property in the future and detailing how a future sale is to be dealt with.

Solum

This refers to the area of ground upon which a building has been constructed. The owner of a flat in a tenement should also own a right in common with the other proprietors in the building to the solum on which that tenement is built.

State for settlement

In advance of settlement of a purchase, a state for settlement is often produced providing a detailed breakdown of all the funds required to complete the transaction. Often the majority of these funds will come from the mortgage provider, with the remaining balance being provided by the purchaser including the deposit, all tax due and the registration dues for the title.

Survivorship Clause/Destination

A survivorship destination is a clause included in a title for a property owned by two or more individuals which provides that on death, the share of title which is held automatically passes to the surviving co-owner/owners. This is most commonly used when a property is owned by husband and wife. It is deemed to operate out of contract and cannot be unilaterally removed at a later date without mutual consent. This also operates irrespective of the provisions in any Will.

Stamp Duty

Stamp Duty was the previous tax payable to HMRC on the purchase of a property. This has now been abolished and replaced with Land and Building Transaction Tax (LBTT), introduced in April 2015.

Sales Schedule

The sales schedule is the brochure produced by the selling agents listing the key characteristics of the property, the viewing and relevant information from the seller.

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Telegraphic Transfer Charge

A telegraphic transfer, commonly abbreviated to TT, is the electronic transfer of funds between banks. The transfer charge is the charge which the transferring (rather than receiving bank) make for this service.

Tenement

Section 26 of the Tenement (Scotland) Act 2004 defines a tenement as:

"Two or more related but separate flats divided from each other horizontally.” 

Essentially this definition means that a tenement consists of two or more individual dwellings within a single building and may arise from the conversion of a former self-contained dwellinghouse or they may be purpose built as a flatted tenement.  Accommodation within the city centre of Edinburgh is predominantly tenemental in nature.  Whilst each individual flat within a tenement building comprises a separate dwelling, they are inter-linked by the use and/or ownership of shared facilities (for example a common stair and outer entrance door), amenities (for example a drying green or car parking spaces) and services/utilities.  The successful management and maintenance of a tenement building invariably involves a degree of co-operation amongst co-owners within the building which may be reinforced by the appointment of a Factor, the constitution of an active Proprietors or Residents Association and the local authority, if the maintenance works required have an urgent or emergency element (usually interpreted as a danger to public health or safety).

The Scottish Law of the Tenement was largely codified (condensed into writing) within the Tenements (Scotland) Act 2004.  The Act sets out the position in relation to the ownership of certain areas forming part of the tenement building and liability for maintaining the structural components of a tenement (known as “Scheme Property”) for instance the foundations, exterior walls and roofs. It also establishes a comprehensive decision making procedure for agreeing the execution of repairs and/or maintenance to and of Scheme Property. This is known as the Tenement Management Scheme and operates where the titles to the separate flats do not themselves regulate those matters or where the share of liability for maintenance imposed within titles collectively do not aggregate to 100%.  For tenements located in Edinburgh, the Local Authority’s Shared Repairs Service is also available to assist homeowners wishing to arrange, repair or have maintenance carried out on Scheme Property or other communal areas [link to Shared Repairs website] and also to recover from an uncooperative or unresponsive owner their share of the costs incurred in undertaking a communal repair or in the maintenance of a communal area.
The Act also deals with ancillary matters, for example providing that it is now a legal obligation for each flat to maintain continuous buildings insurance at the full reinstatement value assessed on the flat from time to time.                                                         

Terms of Business

It is mandatory for all solicitors to issue terms of business letters to their clients in all property transactions. This is included in the letter of engagement which is sent out in the early stages of any transaction.

Title deeds

Title deeds are the legal documents demonstrating ownership of a property. They can consist of the more historic Sasine titles or the simple Land Certificate registered in the Land Register of Scotland. Titles also usually contain any timber specialist guarantees and local authority documentation for alterations etcetera.

Title Number

Every property registered in the Land Register of Scotland is assigned a specific Title Number to help identify it on the Cadastral Map. This contains an initial three letter code identifying the specific Land Registration County in which the property is located and then its particular number.

Title Sheet

A title sheet is an official record relating to a particular property. Each title sheet contains the boundaries of a property, the property description, details of the current registered proprietor, whether there is a mortgage over the property and the obligations on the property owner.

Tree Preservation Order

Commonly known as a TPO this is a mechanism for protecting individual trees, woodlands or groups of trees which have particular amenity value or make a significant contribution to the landscape.  Where there is a TPO in place, it is an offence for any person to cut down or wilfully destroy or damage a tree, without the consent of the planning authority.

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UK Finance (formerly Council of Mortgage Lenders (CML))

This organisation is an amalgamation of the major mortgage providers in the UK, established to promote a favourable and stable operating environment in the housing and mortgage markets. It originally led to the creation of the CML handbook which is referred to for guidance and rules on what all lenders will expect a conveyancer to cover in examining title to a property and in determining what is an acceptable property to them for lending purposes. The organisation changed its name in July 2017 to UK Finance and the CML Handbook became the UK Finance Mortgage Lenders Handbook. It includes generic conditions which apply to all lenders but also specific requirements individual to the particular lender. These particular conditions must be met before the certificate of title can be submitted to the lender.

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Vacant possession

Most property is bought with vacant possession that is empty of moveable objects and most importantly of occupiers such as tenants.

Vassal

A now archaic term used to identify a property owner who, under the feudal tenure system had obligations to a Feudal superior.

Vendor

This is not a term used in Scotland other than to denote a street hawker.

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Warrandice

This is a clause contained in the deed transferring title to a property whereby the seller guarantees that they have not sold or transferred ownership to a third party. Warrandice is the personal guarantee given by a granter of a deed to the grantee.

Wayleave

This is commonly used to describe the right to run utilities of whatever description on, through or over land in the ownership of a third party and is often coupled with a right of access for the maintenance, repair and renewal of those utilities subject to the obligation to make good any surface damage caused to the land in the exercise of that right. 

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