RES exam question on Private Property Sale: Ms Ho exercised an option over a Bukit Timah apartment that is mortgaged to the seller's…
Ms Ho exercised an option over a Bukit Timah apartment that is mortgaged to the seller's bank. Her salesperson sets out the conveyancing steps her solicitor will take before and after completion. Which of the following statements are correct? (i) Her solicitor searches the title early to confirm the owner and any mortgages, caveats or other encumbrances. (ii) Her solicitor lodges a caveat after exercise to protect her interest against later dealings. (iii) Her caveat prevents the seller's bank from exercising its power of sale under its earlier registered mortgage. (iv) The transfer is lodged after completion, and she becomes registered proprietor only when it is registered.
- A(i) and (ii) only
- B(ii), (iii) and (iv) only
- C(i), (ii) and (iv) only
- D(i), (iii) and (iv) only
Show answer & explanation
Answer
C. (i), (ii) and (iv) only
Explanation
Answer: (i), (ii) and (iv) only. A caveat gives notice and protects priority, but it cannot defeat a mortgage registered earlier.(i) True. The buyer's solicitor searches the title to confirm ownership and any encumbrances.(ii) True. A buyer who has exercised an option has an interest she can protect by caveat.(iv) True. Ownership passes only on registration of the transfer.Rule: A caveat gives notice and protects priority but neither transfers ownership nor freezes the title. Priority generally follows the order of registration or lodgement.Source: Land Titles Act 1993 ss 115(1) and 119(4) (sso.agc.gov.sg, read 1 October 2026); /learn/caveats-and-registration-of-title
Why the other options are wrong
- (iii) False. The bank's mortgage was registered first, and a later caveat does not defeat its power of sale. Ms Ho is protected because the mortgage is redeemed from the completion money.
Study the concept behind this question: OTP Singapore: Option to Purchase Fee, Period & Exercise
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