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Jargon Buster

The language of leases and deeds can be unfamiliar and we have therefore provided some definitions to help you with their understanding.

We have also included some other terms which may be used within the home ownership sector.

Term/phrase Definition
Alienation The transfer of the ownership of the property rights
All that Tells you what and where the property is
Appurtenance Property that belongs to something else, eg, sheds and gardens of a building
Assignment Transfer from one person to another
Conveyance A document (other than a Will) that transfers Property from one to another
Covenant Agreement that obliges to do or not to do something
Cyclical Fund The lease will determine if a cyclical fund is applicable and what this would be used for. It would generally be used to collect towards future works within the service charges which are required on a cyclical basis, ie, if the lease stipulates that redecoration of the internal communal areas should be completed every 5 years etc.
Deed A legal document usually dealing with ownership or occupation of land
Deed of Covenant A document which the buyer of a leasehold property signs to agree to adhere to the lease terms.
Deed of Variation A document supplemental to the lease putting into effect a variation to the lease, ie, to allow sub-letting where it was not previously allowed within the original lease.
Defects Aspects of a new build construction which have not been carried out in accordance with the contract
Defects period There is generally a time-frame from the date of the first purchase of a new build property (or from the date that the property has been handed over to the landlord from the construction company), within which the purchaser can refer identified defects to the construction company/to their landlord.
Demise The physical extent of the property owned by the leaseholder
Easement The rights a landowner has over the lands of someone else, such as rights of way, rights of light, drainage etc
Enfranchisement Process of conversion to freehold
For and in consideration of How much the property is going to be sold for
Forfeiture of the lease The landlord may have the right to forfeiture of the lease if the leaseholder breaches the terms of their lease. This would allow the landlord to take back ownership of the property by terminating the lease and the leaseholder would lose any rights to or equity in the property.
Freehold Absolute ownership of the land
Freeholder The owner of the land
Ground rent The freeholder’s charge for renting the ground on which the leasehold property is built. The lease will outline any applicable ground rents and when these are due.
Head Lease A head lease is the original lease between a tenant and a landlord. In such a lease, the overall contractual responsibility is given to one identifiable tenant called the head lessee. It is a primary lease under which subleases have been granted. It is also termed as primary lease or chief lease.
Hereditament Land/property that can be inherited.
Indenture A deed with two or more parties involved.
Lease The lease is a legally binding document (a deed) between the leaseholder and their landlord outlining the term that the lease has been granted for and what obligations each party to the lease has in terms of paying rents, service charges, complying with restrictions such as age restrictions, making alterations to the property, repairs, assignments etc.
Lease extension The process of extending the term of the lease. For example, some mortgage lenders will not lend on properties with 80 or less years left on the lease, so leaseholders can apply to the freeholder to obtain a lease extension.
Leasehold The legal right to use a property or piece of land as outlined within the lease agreement for the term and in accordance with the conditions as prescribed within the lease.
Leaseholder/Lessee The person who owns the lease for the period specified within the lease.
LPE1 (Leasehold Property Enquiries form) This is a standard form issued by solicitors acting on behalf of the purchaser of your leasehold property to ascertain any specific terms of your lease, charges etc.
Major works Major works are works carried out on a large scale that may increase the service charge for a leaseholder. They may involve works such as redecorations, roof replacements, window replacements and projects in accordance with the terms of your lease to generally improve leasehold properties
Notice of Assignment/Transfer The lease or deeds for your property will outline any requirements in regard to the assignment of your property. A Notice of Assignment/Transfer is a general requirement of the Landlord to supply on assignment to certify that all conditions of the lease have been complied with.
Peppercorn rent A nominal rent which is usually not collected.
Protected Areas A principle introduced to ensure shared ownership properties in specific geographical areas to ensure the properties remain affordable either by restricting staircasing to a maximum level (75%, 80% etc) or by requiring the leaseholder to sell back to the Landlord.
Reserve/sinking fund Leases will usually specify if there is a reserve/sinking fund in place for your property or scheme. These funds are collected to set aside service charges for future costs at the scheme to help leaseholders save towards major works etc. The lease should also specify what the reserve/sinking fund can be used for, ie, improvements, replacement items for the communal areas or structure of the building.
Restrictive covenants A restrictive covenant is an agreement in a deed which restricts the use of the land. These restrictions remain with the land when it is sold and are therefore passed to the new owners. These covenants are generally imposed to ensure that the value and enjoyment of adjoining land is preserved, such as preventing the building of extensions on the land. These covenants are identified on the title register on land registry.
Right of way Right of passage over lands owned by another person
Section 106 A contract entered into by a local planning authority and property developer under section 106 of the Town and Planning Act 1990 under which the developer agrees to provide defined facilities such as affordable housing, as part of the proposed development.
Service Charges Service charges are defined within the terms of your lease or deeds as payable to your landlord for the costs incurred for the landlord’s repair and maintenance responsibilities. This could include buildings insurance and the costs for maintaining the communal areas of the scheme.
Scheme A group of individual properties typically of similar design that are usually built and sold or leased by one management.
Shared ownership Under a shared ownership lease, the Leaseholder buys a share in the property and pays rent on the remaining share of the property, which remains in the ownership of the Landlord.
Staircasing The process of purchasing more equity in a shared ownership property. For example, if the shared ownership property was originally purchased with 50% equity, then the lease will outline if and in what portions the remaining equity can be purchased.
Sub-Lease A lease by a tenant or lessee of part or all of leased premises to another person but with the original tenant retaining some right or interest under the original lease.
Unadopted road Road for the use of residents and maintained at their expense, not maintained by the council or local authority.
Whereas This often shows the history of the property.
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