WANGANUI VALUERS LIMITED  
  • What is a company title?

    17 September at 20:16 from atlas

    A Company Title is a form of property ownership represented by owning shares in a company that owns a property, but not represented by direct ownership of the property itself.

    Company share title is most common with multi-unit properties like apartments. 
    The Title to the land and buildings is owned by a company.
    The owner of a company share apartment will not own (i.e. have any title to) the apartment, but will own an equity share in the company that owns the land and buildings. The owner's occupation of the apartment is normally represented by a licence to occupy.

    An important note is that a lender cannot register a mortgage over a company  title as it can over freehold or leasehold title. Therefore, the lender cannot exercise the same rights as mortgagee. Most lenders will not accept company tites as security for a loan.

    For lenders that will accept company  title, the security normally required is an unregistered mortgage over the licence to occupy, a signed blank share transfer form plus a deed of covenant from the company. This gives the lender some rights to take possession and sell the property to recover its loan if the borrower defaults on his or her commitments.