“Title Absolute” and “Possessory Title” – what does this mean?
Lauren Walker, an associate in the Real Estate team, looks at the importance of understanding the different types of title which can be given when land is registered at the Land Registry.
When a property is registered at the Land Registry, it is registered with a class of title. Both freehold and leasehold interests may be registered with:
- An absolute title.
- A possessory title.
- A qualified title.
What do these mean?
- Absolute title
Absolute title is the best class of title and this is the class of title granted in most cases.
- Possessory title
Possessory title tends to be granted where an owner is unable to provide documentary evidence of their title to the land – for example, where deeds have been lost in a fire or simply lost over time. Possessory title may also be granted where someone has claimed title by adverse possession of a property or piece of land.
There are two main differences between absolute title and possessory title:
- title can be challenged by someone who claims to have a better title to the property; and
- the property may be subject to third party rights and/or covenants but it is not possible to know what these are as the deeds may have been lost.
Qualified titles are uncommon, but are granted where there is a specific defect in the title to the property, and this will be stated clearly in the title register.
Where a property does not have absolute title (and therefore has either possessory or qualified title), the title to the property will generally not be considered to be “good and marketable” and this can affect the value of a property. Any future lender or purchaser may therefore have concerns regarding the title to the property. It is possible to obtain a title indemnity insurance policy to provide comfort to any lender or purchaser, but whether this will be acceptable to any future lender and/or purchaser will depend on the circumstances in each individual case.
Can I upgrade my title?
The registered owner of the property can apply to the Land Registry have their class of title upgraded.
If you have possessory title to a property, you must wait 12 years from the original registration before you can make such an application. There is no requirement to provide any additional evidence to support such an application. The fact that the property has been registered for the 12 year period without challenge is sufficient.
If you have qualified title to a property then you can apply at any time to upgrade your title by providing evidence of title to the Land Registry which remedies the reason why the qualified title was granted in the first place. The Land Registry will then examine any evidence provided and, if the evidence is sufficient, then the title will be upgraded. Unlike with possessory title, it is not possible to upgrade qualified title merely by waiting 12 years from the original registration.
If you have any questions relating to the class of title granted in relation to property you own or if you require any assistance in having land registered or your title upgraded, please do get in touch with our Real Estate Team who will be happy to help you.