A property charge is a legal claim placed on a property by a creditor to secure the payment of a debt. It gives the creditor the right to seize or sell the property if the owner fails to meet financial obligations, such as unpaid taxes, mortgages, or contractor fees. Until the charge is resolved, it can hinder the property’s sale or refinancing.
When buying a property, your conveyancing solicitor plays a key role in ensuring that no charges are attached to it. Their responsibility includes confirming that the property’s title is free from any burdens or encumbrances before the sale can proceed.
Conducting title searches
Your solicitor will start by conducting a thorough title search to check the property’s legal status. This involves reviewing the Land Registry or Registry of Deeds to ensure there are no outstanding charges, mortgages, or burdens against the property. If a charge is found, it must be resolved before the sale can proceed.
Identifying the charge
If your solicitor finds a charge on the property (such as a judgment debt or an unpaid mortgage), they will inform both you and the property owner. Your solicitor will identify the amount owed, the creditor, and the nature of the charge (whether it’s a voluntary charge like a mortgage or an involuntary charge like a court judgment).
Arranging for payment of the debt
Your solicitor will then work with the property owner to ensure that the outstanding debt is paid. Generally, it is the seller’s responsibility to settle any charges on the property by or before the closing day. In most cases, charges are paid off using the proceeds from the sale at the time of closing. Your solicitor will ensure this process is handled correctly by coordinating with the relevant parties to ensure that the charge is fully paid and released.
Obtaining the release of the charge
Once the charge is paid off or settled, your solicitor will obtain a Release of Charge from the creditor. This legal document confirms that the charge has been cleared and will be submitted to the relevant authorities to update the property’s title.
Ensuring proper registration
Next, your solicitor ensures that the charge is officially removed from the property’s title. This is done by registering the Release of Charge with the Land Registry or Registry of Deeds. Once registered, the charge is no longer associated with the property, ensuring that the buyer will receive a clean, unencumbered title.
Handling the closing process
Finally, your solicitor oversees the completion of the sale, ensuring all legal and financial matters are in order. They ensure all necessary documents are prepared, verify property titles, and handle contracts between the buyer and seller. Your solicitor also manages the financial transactions, such as transferring funds and paying relevant fees, ensuring that legal obligations are met by both parties and that you are not liable for any previous debts or encumbrances.
Require assistance with buying or selling a property?
The conveyancing team at McCarthy + Co Solicitors LLP has many years of experience assisting clients across Ireland with the legal aspects of buying or selling property. Arrange an appointment to speak to a conveyancing solicitor today by completing our confidential online form.
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