ARTL

Automated Registration of Title to Land system of title registration.  Titles and mortgages can now, subject to certian criteria, be registered in the public Land Register on-line through the use of high-security digital signatures, thus doing away with paper titles and documents all together

Asking price

The price that a seller is advertising their property at.  This price may be expressed as (a) “offers over” indicating that the seller seeks to achieve a price in excess of the figure specified.  An offers over price may encourage interest from more than one prospective purchaser in which case a closing date for the submission of competing offers may be fixed (b) “offers in the region of/offers around”  indicating a possible degree of flexibility in the seller’s expectation (c) “fixed price” essentially the seller would accept an offer at the the amount specified

Bridging loan

A loan from a bank in order to fund a property purchase pending the completion of a concurrent sale.  “Closed” bridging would be in circumstances where sale missives had already been concluded.  “Open” bridging would be where the property has not yet sold.  Because of the inherent risks to a bank of lending in either circumstance, bridging facilities are not commonly available

Building consents

Local authority consents required in relation to proposed alterations to a property.  The form of consent will depend on circumstances and may include: change of use, planning, listed building and/or building warrant.  There are material risks in carrying out works without consents being obtained, even for apparently minor works, in relation to compliance (to avoid enforcement action on the part of the local authority), health and safety issues and the the ability to produce relevant documentation to a purchaser on a future sale of a property.

Closing date

If in a property sale there is interest from more than one prospective purchaser  a closing date for the submission of competing offers may be fixed by the selling agent.  Offers in written legal terms are invited from parties who have noted interest in the property, to be submitted by the purchaser’s solicitors by post, fax email for the property, at a specific time on the closing date, and from which the seller chooses the preferred offer.  The seller is not obliged to accept the highest or indeed any offer.  The seller is not subsequently entitled to trade offers between offering parties.

Completion (English law)

The English equivalent of Settlement in Scotland

Conveyancing

The legal process of transferring title, security matters and implementation of the missives contract.  For purchasers the process involves examination and reporting on title (including extent and description of property and conditions of ownership), co-ordination of funding arrangments including mortgage instructions and security documents, examination of local authority property certificates, examination of building consents documentation/requirements, investigation of issues raised in survey reports, processing of missives requirements, inspection of land register searches and reports and co-ordinating settlement.  For seller’s the processes and roles are reversed

Date of Entry

The day on which the sale of a property is completed

Deposit

With more expensive properties a deposit (of 5%-10% of the price) may be requested by a seller to be paid within so many (typically 14 -21) days from the conclusion of missives. This may or may not be refundable in the event of the purchase not going ahead

Disposition

The Disposition is the legal transfer of title document that is signed by a seller in favour of a purchaser

Energy Performance Certificate (or EPC)

An element of a Home Report containing an assessment by a surveyor of the energy efficiency of a property and its environmental impact as well as recommending ways to improve its energy efficiency

Exchange of contracts (English law)

The English equivalent of conclusion of missives in Scotland (in England a deposit on exchange of contracts is usually payable whereas in Scotland this is not normally the case)

Factors

Factors are companies that organise the repair and maintenance of blocks of flats or developments of properties with common areas on behalf of all the owners.  They may also arrange common buildings insurance policies, gardening of mutual grounds, cleaning of common areas etc

Heritable/moveable items

The land and building, and anything that is permanently fixed to it is known as heritable.  Moveable items include furniture and freestanding  appliances. If damage would be caused in the removal of an item it will generally be considered heritable. The distinction between heritable and moveable items may become important in relation to Stamp Duty Land Tax which is only due on the heritable element of a transaction.

Home Report

From December 1 2008 houses for sale have had to be marketed by the seller of a property along with a Home Report which is a pack of three documents:  a Single Survey, an Energy Report  and a Property Questionnaire.  The Home Report must be made available on request to prospective buyers

Land and Buildings Transaction Tax (LBTT)

The tax payable to Revenue Scotland on the purchase of a property. The tax is calculated on a progressive incremental scale fixed by the Scottish Government from time to time, according to the price paid for the property.

Land Register of Scotland

The government agency tasked with the indexing of all property in Scotland

Legal charge (English law)

The English equivalent of a Standard Security

Loan to value (LTV)

In the context of mortgages, the percentage of loan relative to the valuation of a given property

Missives

Missives are formal letters passing between the solicitors for seller and purchaser adjusting the details of a contract up until the point that a full consensus on all points has been reached.  At that point and only then, the missives are said to be concluded and comprise a binding legal contract which both parties are bound to implement (failure to do so constituting a breach of contract for which parties will have entitlements to exact contractual penalties and raise court proceedings for recovery of damages etc)

Money Laundering Regulations

The more accurately termed Anti Money Laundering Regulations are statutory provisions enforced in relation to the prevention of concealment of the identity, source, and/or destination of illegally gained money by which the proceeds of crime are converted into assets which appear to have a legitimate origin.  The stringent regulations require amongst other things evidence of the identity of parties to transactions, source of funds involved and the reporting of any suspicious circumstances.  Their are criminal penalties for non-compliance

Mortgage

A loan from a bank or building society to assist a purchaser in the purchase of a property, secured over the property in the form of a Standard Security (or mortgage deed)

Negative equity               

Where the amount due to a lender exceeds the current market value of a property that is subject to the lender’s mortgage

Note of interest

A verbal indication made by a prospective purchaser’s solicitor to a seller’s agent that the prospective purchaser is interested in a property.  Noting interest does not guarantee that a seller will give a prospective purchaser the opportunity to make an offer for the property, nor does it oblige the prospective purchaser to make an offer

Offer

A missive in formal legal terms issued by a purchaser’s solicitors on client’s instructions addressed to a seller’s agents setting out the basis on which a property is offered for

Property enquiry certificate

A certificate issued by a local authority either direct or through a professional  searching agency, providing up to date details relating to notices, orders, zoning, roads, water and drainage etc in relation to a given property (equivalent of an English local search)

Qualified Acceptance

A missive in formal legal terms issued first by a seller’s solicitors and thereafter by the solicitors for either parrty to the negotiation, issued on client’s instructions responding first to the terms of the offer with relevant qualifications to the deal, and thereafter adjusting terms with a view to reaching agreement on all relevant matters

Roof report

If a Home Report or survey specifies work that needs to be carried out to a property a roof report may be instructed to report on matters such as the condition of the roof, chimneys etc and the cost of rectifying any problem

Settlement

The process by, and day on which the price of a property is paid over by the purchaser to the seller, the formal transfer arrangements and implement of the contract is completed, all via the parties’ respective solicitors, and the keys are handed over

Settlement statement

A statement of account issued by a purchaser’s or seller’s solicitors detailing the cash transactions anticipated at settlement of a transaction. Also may be referred to as a cash account or completion statement.

Specialist report

If a Home Report or survey of a property comments on certain defects at the property (eg rising damp, woodworm or  rot) or indicates that certain work may be required, a specialist report may be instructed to investigate and report further (and usually estimate costs associated with rectification).  Sometimes there is a charge for such reports, and it is a matter of negotiation as to who pays for it

Standard Clauses

Purchase/sale negotiations having significantly grown in complexity in recent times, a form of standard offer, that most parties would agree to “settle for” in normal circumstances, has emerged as a means of assisting the speed and efficiency of these negotiations.  The form is that of standard offer clauses based on the “settled for” position of what most parties will usually accept and is a normally accepted starting point to negotiations

Standard Security

A bank or building society’s fixed legal security over a property (equivalent of an English mortgage or Legal Charge)

Statutory notice

A notice placed on a building (commonly a tenement flat (or flat in a block) or building in multi ownership) by a local authority using statutory powers (and in default of action taken by the proprietor/s concerned) requiring repairs or other works to be carried out

Structural engineer’s report

If a Home Report or survey of a property comments on certain structural aspects of a property, a structural engineer’s report may be required to investigate and report further.  A structural issue with a property or building may have a material affect on the property’s mortgageability and/or marketability

Subject to survey

The term used when a purchaser makes a formal offer for a property, which is conditional on obtaining and approval by them and/or their lender of the seller’s Home Report, or their own survey of a property

Survey

A report on the condition and value of a property, carried out by a member of the Royal Institution of Chartered Surveyors.  Lenders will only accept reports from their panel of approved surveyors.  There are a number of different levels of survey to choose from depending on purpose, cost and practical considerations

Terms of Business

Terms of Business set out the basis on which solicitors for the parties will carry out the relevant work involved

Title deeds/documents

The legal evidence of ownership of a property, title conditions and current mortgages/securities.

Ownership is registered in the public Land Register, and copies of title deeds/documents, if lost or otherwise required, are generally available from the Registers of Scotland at prevailing cost.

Unregistered title deeds/documents (titles to properties still held in the Sasine records of the Land Register) are retained as physical documents.

In the case of registered titles evidence of ownership is no longer physically retained, and is held electronically in the Land Register.

Along with documents relating to ownership other property related papers (eg consents to alterations, specialist guarantees/specifications, new-build certification) should be retained with care.

Some lenders require to hold on to all or certain specified title and other property related papers in furtherance of their security during the period of the loan. Otherwise such documentation will, unless instructed otherwise, be forwarded to the property owner for their own safe keeping.

Title Sheet

The electronic record maintained by the Land Register of Scotland as a public register or index of each and very registered property in Scotland. Hard copy Land Certificates are no longer issued. Copy Title Sheets can be downloaded from the Registers of Scotland website subject to access permissions and prevailing charges.

Under offer

In circumstances where a seller’s solicitor has verbally accepted a formal offer on behalf of the seller, but missives have not yet been concluded, the property is said to be “under offer”

Vacant possession

A property bought with vacant possession is one which is not subject to and tenants’ rights of occupancy

Vendor (English law)

A seller in Scotland