A commercial lender may secure a loan against the property, the borrowing company’s assets, personal guarantees or a combination of these. Before you sign, understand which document covers what, how the lender will rank against existing finance and what must be registered after completion. This guide explains the practical questions to raise with your broker and solicitor.
A legal charge secures the property; a debenture can secure a company’s wider assets
The documents are related but not interchangeable. A lender taking property security will usually require the appropriate mortgage or land-security document. Where the borrower is a company or LLP, it may also require a debenture containing fixed and floating security over specified or wider business assets. The exact package depends on the lender, borrower, property, existing finance and transaction.
Four types of security can appear in a commercial mortgage transaction
A case may use one document or several. Understanding the role of each helps prevent surprises during legal work and makes it easier to compare lender terms properly.
Legal charge or land security
This gives the lender security over the commercial property. The document and registration route depend on the UK nation and title. It can affect sale, transfer, further borrowing and enforcement if the secured debt is not repaid.
Debenture
A company debenture may create fixed security over identified assets and floating security over a changing pool of assets. It can also contain restrictions on granting later security without consent.
Personal guarantee
A director, shareholder or other person agrees to be responsible for specified borrower obligations. A guarantee is separate from property and company security and may be capped or unlimited according to its wording.
Cross-guarantee or extra security
A lender may ask another company or property owner to support the debt, take an assignment of rent or insurance, or require shareholder loans to be subordinated. These terms need their own legal review.
Current public lender material demonstrates why the package must be checked case by case. Aldermore’s commercial criteria list a first legal charge and other possible security requirements, while InterBay’s commercial criteria show that additional company security and guarantees can apply in particular structures. These are examples, not Count Ready promises that the same terms will apply to your case.
What should you check in a commercial mortgage legal charge?
The property charge is not merely an administrative form. It is a core lender document and can contain continuing obligations that matter throughout the loan.
Property and title
Confirm every title, building, yard, parking area, access strip and leasehold interest intended as security. An omitted title or right can delay completion or leave the lender without the security it approved.
Debt covered
Establish whether the charge secures only the stated mortgage or uses wider all-monies wording that can cover other present or future liabilities to the lender. Ask the solicitor to explain the practical scope.
Priority
Check whether the lender requires a first-ranking charge and whether another bank, bridging lender, asset financier or creditor already has security. Priority may need consent or a separate deed.
Property obligations
Review duties concerning insurance, repair, occupation, letting, alterations, planning, environmental matters, access for inspection and information. These may sit in the charge, facility agreement or mortgage conditions. The commercial mortgage covenants and lender consent guide explains how to identify financial tests, information duties and changes that need written approval.
Disposals and further borrowing
A lender may require consent before a sale, lease, transfer, subdivision or later charge. This can affect future plans even when repayments are up to date.
Default and enforcement
Understand which events can trigger lender remedies, including non-payment and breaches of other obligations. The commercial consequences must be considered before signing, not only after a problem occurs. If non-payment, a default notice or an enforcement deadline is already involved, use the commercial mortgage arrears, default and lender support guide to organise the immediate response. A refinance enquiry does not by itself pause lender rights or extend a deadline.
For England and Wales, HM Land Registry Practice Guide 29 covers registration of legal charges and deeds varying them. The exact legal route differs in Scotland and Northern Ireland.
What does a commercial mortgage debenture mean for the business?
A debenture can give a lender security beyond the mortgaged property. Its scope is document-specific, so the business should understand both the assets covered and the operational consents it may need later.
Fixed security
Fixed security is normally tied to specified assets or asset classes identified by the document. The company may have less freedom to dispose of or deal with those assets without lender consent. The precise assets and restrictions must be read from the debenture.
Floating security
Floating security can cover a changing pool of business assets while the company continues trading. The document explains when it may attach more specifically to assets and what happens after a default or other specified event.
Negative pledge
A negative pledge can restrict the company from creating later security that ranks equally with or ahead of the lender’s charge. This may affect future bank facilities, asset finance or refinancing plans.
Public company record
A registrable company charge is entered on the Companies House record with a certified copy of the instrument. Permitted personal information can be redacted, but the filing is not a private internal document.
Companies House MR01 guidance expressly asks whether an instrument contains other fixed security, a floating charge and a negative pledge. That makes these important document-reading questions rather than interchangeable labels.
First charge, second charge and priority arrangements
Security ranking affects who is paid first from secured assets and which lender can control later decisions. It should be mapped before the new lender instructs legal work.
How the security package moves through a commercial mortgage transaction
The broker can help coordinate the finance requirements, but the solicitor must advise on the documents, execution, priority and registration for the actual transaction.
Confirm the lender requirement
Read the offer and security schedule. Identify the property charge, debenture, guarantees, assignments and any additional or third-party security.
Investigate existing security
The solicitor reviews title and company records, while the borrower discloses all current facilities. Redemption, consent or priority arrangements are identified.
Explain and execute documents
The appropriate parties receive legal advice, company approvals are completed and documents are signed using the execution route required for that entity and instrument.
Complete and register
After drawdown, the responsible legal team completes land and company filings, follows any lender deadline and reports completion or registration as required.
Companies House guidance states that a company charge should be delivered within 21 days beginning the day after creation; late registration requires a court order. The filing includes a certified copy of the charge instrument and becomes part of the public company record. Confirm responsibility and evidence of filing with the solicitor rather than assuming it has happened automatically.
The land-security document and register depend on where the property is located
The commercial objective may be similar, but terminology and registration differ across the UK. Use a solicitor qualified for the relevant jurisdiction and property.
England and Wales
A legal charge over registered land is dealt with through HM Land Registry. The lender’s charge form, title restrictions and any discharge after repayment must follow the relevant land-registration process.
Scotland
Mortgage security over Scottish land is generally known as a standard security. Repayment does not itself remove it from the register; a lender-signed discharge must be registered if the security is to be removed.
Northern Ireland
The Northern Ireland Land Registry records title and encumbrances such as mortgages. Its forms, rules and registration process are separate from those used by HM Land Registry and Registers of Scotland.
Official starting points include HM Land Registry, Registers of Scotland and the Northern Ireland Land Registry information service.
Questions to put to the broker and solicitor
Use this list to expose gaps before they become a completion or refinancing problem.
For the wider legal timetable, read Count Ready’s commercial mortgage solicitor guide. For individual liability, use the separate personal guarantees guide.
Paying the debt and releasing the security are separate tasks
A redeemed loan should be followed through until the relevant property and company records show the correct position. This matters for later sales, refinancing and company due diligence.
Obtain the redemption position
Confirm the amount, date, interest, fees and any conditions for repayment. If refinancing, coordinate the old lender’s release with the new lender’s completion and priority requirements.
Release the land security
The lender or solicitor must use the jurisdiction-appropriate discharge or release route. In England and Wales this may involve electronic discharge or Land Registry forms; Scotland uses a discharge of standard security.
Update the company record
For a registered company charge, check whether Companies House should be told that the charge is satisfied in full or part, or that property has been released. Keep evidence with the company’s finance records.
Companies House provides MR04 and MR05 routes for satisfaction and release information. HM Land Registry Practice Guide 31 explains discharges for England and Wales. The responsible professional should confirm the correct steps for your transaction.
Sources used for this legal charge and debenture guide
These sources illustrate lender requirements and official registration or discharge processes. They do not replace the finance offer, security documents, lender instructions or transaction-specific legal advice.
- Current lender examples: Aldermore’s commercial mortgage product guide and InterBay’s commercial criteria. These demonstrate that first legal charges, guarantees, subordinations or other security can be requested, but they are not market-wide rules or promises for an individual case.
- HM Land Registry Practice Guide 29 — official professional guidance on registering legal charges, priority and variations for England and Wales. Other UK jurisdictions use different documents and registers.
- Companies House guidance: register a company charge and complete paper form MR01. The company’s solicitor or other responsible professional should confirm whether the security is registrable, who will file it and the applicable deadline.
- HM Land Registry Practice Guide 31 — official guidance on discharging registered charges in England and Wales. Repaying the debt and completing every property or company-record update remain separate steps.
- Jurisdiction-specific starting points: Registers of Scotland guidance on discharging a standard security and Northern Ireland Land Registry information. Terminology, forms, professional rules and registration routes differ across the UK.
Evidence boundary
The executed legal charge, debenture, guarantee, facility agreement, mortgage conditions, priority documents, lender instructions and the advice of the solicitor acting in the relevant jurisdiction control the case. Count Ready can help clarify the proposed mortgage structure and coordinate finance questions, but cannot interpret security documents, approve their legal effect or confirm registration or release.
Source status: Aldermore’s product guide is dated 25 March 2026 and marked for intermediary use only; InterBay’s criteria are lender-specific examples. HM Land Registry Practice Guides 29 and 31 cover registered-charge applications and discharges in England and Wales; Companies House guidance covers company-charge filings across the UK; Registers of Scotland covers Scottish standard securities; and the Department of Finance covers Northern Ireland Land Registry. These sources do not replace executed security documents, lender instructions or jurisdiction-specific legal advice.
Last reviewed: 22 July 2026. All eight linked sources were checked on this date.
Tell us about the borrower, property and proposed security
Share the purchase or refinance objective, borrowing entity, property, loan amount, existing lenders and any security, guarantee or debenture requirements already mentioned. Count Ready can review the mortgage route, explain the finance questions to clarify and help you prepare for the lender and solicitor discussions. Use the form for outline details only; the note below explains what not to send and how documents should be shared.
Commercial mortgage legal charge and debenture questions
Practical answers about property security, company charges, ranking, registration and release.
What is a legal charge on a commercial mortgage?
A legal charge is a security document giving the lender rights over the commercial property if the secured obligations are not met. It is normally registered against the relevant property title using the process for the UK nation where the property is located. The actual document can also contain continuing duties and restrictions, so it should be explained by the solicitor before signing.
Is a debenture the same as a legal charge?
No. A property legal charge secures the lender against the land or property interest identified in the document. A company debenture can create security over other company assets and may include fixed security, floating security and a negative pledge. A lender may require either document or both, depending on the borrower and transaction.
Does every limited company commercial mortgage need a debenture?
No. Security requirements vary by lender, loan, property, company structure, credit assessment and existing finance. Some lenders require a debenture for particular limited-company cases, while others may rely on a property charge and different supporting security. The offer and lender’s solicitor instructions confirm the requirement for the actual case.
What is the difference between fixed and floating security?
Fixed security is generally tied to specified assets and can limit how the company deals with them without consent. Floating security can cover a changing pool of company assets while the business continues trading, subject to the document’s terms and events that may cause the security to attach more specifically. Your solicitor should explain the assets, restrictions and enforcement wording in the proposed debenture.
Can a lender take a personal guarantee as well as a debenture?
Yes. A personal guarantee, company debenture and property charge protect the lender in different ways and can be required together. The guarantor should understand the amount and obligations covered, any cap, continuing liability, independent legal advice requirement and circumstances in which the guarantee can be enforced.
What is a first-ranking commercial mortgage charge?
A first-ranking charge is intended to give that lender priority over later charges against the same secured property, subject to the law and any agreed priority terms. If another charge already exists, it may need to be repaid, released, postponed or governed by a deed of priority before the new mortgage can complete.
How is a company charge registered at Companies House?
A registrable company charge is normally delivered using form MR01 with the required fee and a certified copy of the charge instrument. Companies House says the documents must be delivered within 21 days beginning the day after the charge was created; late registration requires a court order. Confirm who will file it and retain evidence of registration.
What happens to the security when the commercial mortgage is repaid?
Repaying the debt does not by itself complete every public-record update. The property security must be discharged or released through the relevant land-registration route, and the company record may need a satisfaction or release filing. In a refinance, the old release and new security are usually coordinated as part of completion.
Prepare the complete legal and finance picture
These guides cover the questions that usually sit alongside lender security requirements.
This guide provides general information and is not legal, tax, accounting, insolvency, valuation, insurance or mortgage advice. Security documents, priority, registration, enforcement and release depend on the lender, borrower, property, UK jurisdiction and full circumstances. Obtain advice from a solicitor qualified for the relevant transaction and rely on the actual offer, facility and security documents for your case.