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Cancellation of Paper Certificates of Title in NSW

The cancellation of all remaining paper Certificates of Title in NSW has been announced. If the legislation is passed by the NSW Parliament later this year, the cancellations are expected to occur in mid-2021.


On cancellation, a paper Certificate of Title will cease to be a legal document, and will no longer be evidence of title to the land represented in the Folio. The paper Certificate of Title will be replaced with the Control of the Right to Deal (CoRD). For unencumbered property, the CoRD Holder will be the registered proprietor (owner). If a property is mortgaged, the CoRD will usually be held by the registered mortgagee.


This significant change will impact lenders who have the practice of holding the paper Certificate of Title as security for payment. On cancellation, possession of the paper Certificate of Title will cease providing effective security as the registered proprietor will be free to deal with the property as the CoRD Holder.


Lenders should prepare now and consider what alternative security is available. Not all options are suitable to every circumstance.


Options that may be considered include:

  1. Registration of a formal mortgage on title;

  2. Lodgement of a caveat over the title; and

  3. Registering a Security Interest over personal property on the Personal Property Securities Register (PPSR).

Lenders should also review the wording of security clauses in their standard loan agreements, and update these if necessary to ensure the Lender is able to enforce its security.

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Article written by Ruth Tzouras | Conveyancer and Paralegal

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