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Land Law: Mortgages, Legal and Equitable Title

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    Hey TSR'ers,

    All enjoying revision time?
    I've just got a quick question on mortgages within Land Law... How do the titles stand? So for example, in a bog-standard case of Bob buying a house and acquiring a mortgage from HSBC lets say.... Who holds the titles? Would Bob hold both the legal and equitable title? Or would HSBC? Would one hold one, or one hold the other.

    I feel like this should be so simple, but I think my brain has reached full capacity so has obviously lost all rational thought, but I also can't find anything in my notes, so if anyone could enlighten me please, I will rep you like nobody's business

    Peace out sugar mouse! (and thanks in advance!)
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    (Original post by sophie_snail)
    Hey TSR'ers,

    All enjoying revision time?
    I've just got a quick question on mortgages within Land Law... How do the titles stand? So for example, in a bog-standard case of Bob buying a house and acquiring a mortgage from HSBC lets say.... Who holds the titles? Would Bob hold both the legal and equitable title? Or would HSBC? Would one hold one, or one hold the other.

    I feel like this should be so simple, but I think my brain has reached full capacity so has obviously lost all rational thought, but I also can't find anything in my notes, so if anyone could enlighten me please, I will rep you like nobody's business

    Peace out sugar mouse! (and thanks in advance!)
    Unless the land is held on trust, there is no equitable title. Bob is the registered proprietor and legal owner of the freehold. HSBC is the legal owner of the charge they hold over the freehold to secure repayment of the mortgage loan. No equitable titles or interests are involved at all in the typical case.
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    A mortgage can only be created by way of legal charge, so the borrower will possess both the legal and equitable title however, the mortgagee will have a charge over it. He will however, NOT own the freehold etc etc. Having a charge over the property gives him certain rights, e.g.the right to sale (when it becomes exercisable), the right to possession (although this is not usually exercised unless the lender wishes to sell the property).
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    (Original post by HannanB)
    the borrower will possess both the legal and equitable title
    No - this is categorically wrong. There is no equitable title to the freehold unless a trust has been created. The registered proprietor - the borrower - has the legal title. And that's it. No one has 'the equitable title' because there is no equitable title.
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    (Original post by mja)
    No - this is categorically wrong. There is no equitable title to the freehold unless a trust has been created. The registered proprietor - the borrower - has the legal title. And that's it. No one has 'the equitable title' because there is no equitable title.


    I agree, but for the purposes of the question she's asking, I'm just trying to make it clear that the beneficial ownership and the legal ownership of the property has NOT been separated, thus the borrower remains the sole owner of the property, and the lender therefore has no interest in the property
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    It's a document that lays over the land in color of title; though it is not the Land itself, it may include with it the right to real property that sits upon the Land. Banks and corporations like Real Estate because they can own it without an Act of Congress. They and others can use the fiction of title to it to seize property under the color of law.

    They've taken their colors of title into the courts for so long that the people (under three generations of deception and ignorance) simply allow them to go ahead. Generally, people seem to have forgotten about land patents.

    For that cause when you go into a court today with a real land title case (a Land Patent case) chances are the judge and any attorneys involved won't know what a Land Patent is.
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    (Original post by areyanstalin)
    chances are the judge and any attorneys involved won't know what a Land Patent is.
    Especially not in the UK where we don't have attorneys (at least not in the sense you are using it), no land patents, no Acts of Congress, etc (this is a UK based forum).
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    (Original post by mja)
    Unless the land is held on trust, there is no equitable title. Bob is the registered proprietor and legal owner of the freehold. HSBC is the legal owner of the charge they hold over the freehold to secure repayment of the mortgage loan. No equitable titles or interests are involved at all in the typical case.
    Thank you so much - reading your reply I feel like Homer Simpson - d'oh! Of course I knew that, I'm just thinking about things too much and it all makes sense now

    Have repped!

    xx

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Updated: May 9, 2012
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