Bank Securities

We choose the lien holder’s caveat as the most suitable caveat to be lodged by the bank as lender is because of it is lodged by a person with whom the document of title has been deposit as security for a loan. The continuance of the lien-holder caveat will not be possible if the lien ceases to exist, e.g. caveator ceases to have the custody of the title. A lien-holder caveat may be withdrawn by the caveator or cancelled by the Registrar when all sums are paid or by court’s action if its entry or continuance is not authorized. A lien-holder’s caveat subsists until it is withdrawn. To be effective as a lien holder caveat, the issue document of title must be deposited with the lender by or with the consent of all the proprietors and not merely by a borrower who is not sole proprietor.
The lender should lodged the caveat when temporary loan. Secondly is transaction involves transfer of ownership at Memorandum of Transfer is pending adjudication. Thirdly, borrower refuses to pay extra stamp duties. And the last is borrower does not want any encumbrances to be indorsed on the title deed.
Once a caveat has been lodged, people are assumed to deal with the property at their own risk. This means that the usual rules of registered interests taking priority will not necessarily apply. For example, a person who is in possession of land and claims to be the purchaser paying by installments to the current registered owner would ordinarily need to seek registration as the owner to protect their interest (hence why most land purchases involve finance to ensure that the owner gains the full purchase price in exchange for transferring full ownership). However, if this unregistered owner was to lodge a caveat, the registered owner / seller could not easily attempt to sell the land to a second person.
A caveat will act to prevent the registration of a further dealing with the land that affects the caveated interest, unless the caveator consents or the caveat lapses, is cancelled,