Title challenges: Protecting a property finance investment
At Westcor, we work to protect our clients’ interests, sometimes for individual property owners, but often for lenders. A recent claim highlighted how a single oversight can jeopardise both a property transaction and the related financial arrangements. In this case, both the borrower and our client, the lender, were able to avoid serious consequences thanks to swift intervention.
The challenge
Our client, a property finance lender, had provided a loan to a borrower, secured by what was intended to be a first legal charge over a property. The borrower was combining the loan with other funds to purchase a new home.
Shortly after completion, the borrower notified the lender that the property had been sold and requested to repay the loan. It quickly became clear that the borrower’s solicitors had failed to register the lender’s legal charge. The property had been transferred to new owners, and another party’s legal charge had already taken priority. This error meant our client was left without the security they had been assured, placing the loan at risk.
The response
Upon being alerted to the issue, Westcor immediately instructed our panel solicitors to obtain and assess the full legal file from the external firm. Our investigation revealed that although the necessary searches had been initiated, the solicitors had not waited for the full results from HM Land Registry. As a result, they missed critical information and allowed the transaction to proceed without the lender’s charge being registered.
Understanding the seriousness of the situation, Westcor swiftly accepted the claim, and the lender was repaid in full under our six month “cure or pay” promise.
The outcome
But we didn’t stop there. Our team pursued a professional negligence claim against the borrower’s solicitors and secured a full recovery within eight weeks of issuing the letter of claim. This case demonstrates the strength of having a title insurance partner who not only responds quickly to protect your position but also acts proactively to pursue remedies and limit losses.
