If you ever intend to use your property as collateral for a loan, make sure you know what the title says. There may be rules, called restrictive covenants, that you may have broken without realising, and legitimate financial institutions do not unconditionally approve loans for properties that are in breach.

The breach may range from building a gate at the front of your house or a wall that’s too close to the curb, depending on guidelines put in place, sometimes long before you bought your dream home.

This is because these restrictions remain in place even when land is sold or passed down. For property owners who may have never carefully scrutinised their titles, now may be a good time.

“Usually, in the middle of the title you will find numbered sentences, which almost seems to be a paragraph, which speaks to the encumbrances or restrictive covenants,” said attorney-at-law, realtor, and lecturer with the Real Estate Board, Priscilla Duhaney.

Property law is among the subjects she teaches.

As Duhaney explained, restrictive covenants sometimes do not appear on titles of subdivided property so it is important to go back to the parent title and check. This prevents any surprises down the line.

According to the National Housing Trust’s Assistant General Manager, Corporate Communications and Public Affairs Dwayne Berbick, homeowners are often not aware of breaches until they have hired a professional to prepare a surveyor’s ID report, one of the documents requested when applying for loans that use the property as collateral.

“Maybe the wall you’ve built, it’s in the wrong place; maybe your neighbour has come over too far on your property; maybe that thing you put on upstairs is kind of hanging over. That’s not going to be approved by the municipal corporation. Sometimes people do things to the property that are not approved. They’ve added other structures that are not approved,” he told the Jamaica Observer recently.

“You have to correct the breach or at least start the process to correct the breach. Or in some instances you can give an undertaking to correct the breach within a particular time. It depends on the nature of the breach,” he added.

That is an expensive process that runs into hundreds of thousands of dollars. Duhaney, who described it as paperwork-intensive, does not recommend that property owners try to wade through the legal quagmire themselves.

“There are certain areas in law that you can do for yourself, but restrictive covenant is usually not one of them,” she said.

According to the attorney, there has to be engagement with the municipal corporation, sometimes National Environment and Planning Agency as well as the Town and Country Planning Authority, and there are typically two to three hearings required. Any misstep may drag the process out to four or five hearings.

“That just means you will be going on and on, probably for years. So it is definitely something I wouldn’t recommend a layman just try to do on his own. If you want to even act with some form of speed or to expedite your process, it’s very unlikely that you doing it on your own is going to bring that result. It’s not a fill-out-a-form [kind of process],” she said.

Stressing that procedures vary within municipal corporations, she said it was “very unlikely” that getting a restrictive covenant lifted or modified will take less than a year. The time it takes also depends on variables, such as whether there are multiple owners, whether they are all located in the same jurisdiction, whether the person trying to do the transaction has the title to the property in hand, or whether it is being held by a mortgagee.

Duhaney also suggested that ahead of applying to the authorities to have a restrictive covenant modified you speak with your neighbours. Some developments have built-in by-laws that prohibit any changes being made without approval from other residents. In the case of a strata, for example, the rules of the strata corporation will clearly outline if approval has to come from all residents or a set percentage of votes. If you are applying to have a restrictive covenant modified, placing ads in the local newspaper and giving neighbours and other concerned parties an opportunity to object is one of the steps required.

“Once your neighbours make the objection, it can delay the process as well as prevent you from getting the restrictive covenant modified,” said Duhaney.

“Based on experience, you want to deal with the [strata] corporation first. Then, from getting their approval, the next step would be to go through the parish council [municipal corporation]. Because the process, at some point, is for your neighbours to be notified. So whether parish council says yes — they’ll give you a provisional approval — you will still need to serve notice on your neighbours or the [strata] corporation,” she added.

It’s also worth noting that if you encroach on your neighbour’s property, it can create a logistical nightmare to sort out if either of you are applying for a loan or want to sell. A surveyor’s ID report will alert you to boundary issues. Duhaney stressed that the nature of the encroachment will determine whether both properties are in breach.

“I’ve seen where persons have built partially on their wall but it doesn’t affect a neighbour. Say you build your house on top of your wall, so your wall and the boundary wall become one. It doesn’t necessarily impact the other person,” she explained.

But if a neighbour’s wall comes over onto your property, it may become very complicated to untangle.

“You technically are not in breach because it’s not you who caused the problem, but you are in breach because it is still your wall and your neighbour’s wall. There is a clear misalignment with your boundary fence, and the bank will not approve of your loan. So you and your neighbour will have to come to some understanding,” said Duhaney.

In a situation like that she suggested seeking guidance from a surveyor who will go through the various options available. This may involve resurveying the property and changing the boundaries to reflect the current reality and then having the changes reflected on the titles of both properties. For that approach to work, both parties will need to come to an agreement.

The best way to avoid all the hassle is to know where your property boundaries are located and go through your title with a fine-tooth comb to see if there are any restrictive covenants.