The conveyancing process made easy There are four main stages in the conveyancing process:- Pre exchange- Exchange- Completion – Post completion Pre exchange Now you have identified a property and found a solicitor, whatare the next steps? You will be sent client care documents, asking you to confirmyou wish to instruct the firm, provide some basic information about yourselvesand put money on account so the solicitors can get started with ordering titledocuments for the property and searches (if buying). You will then be asked tocome in for ID checks. Very simple so far. This is where the path of the buyer and seller begin tofork.
The buyer’s sols will request a draft contract from the seller’s, alongwith an information form and fixtures and fittings form.Now it is time for the buyer’s solicitors to investigate thetitle. This is the most complex and potentially time consuming stage of theprocess.
The key enquiries are as follows:Searches/Enquiries – Review searches. These will be discussed in moredetail later in the blog. – Are there any restrictive covenants on thetitle? Has the seller breached any terms of the title? In simple terms, a titlemay include a covenant stating- ‘you may not build an extension on thisproperty’. If an extension has been built, the seller will need to provideinsurance in case years down the line you as the occupier are sued for theworks. – Have there been any alterations to the property?The enquiries will need to ensure that the correct planning permissions/building regulations certificates/ FENSA certificates and any other necessarycertificates have been obtained at the time. If these are not provided thebuyer could incur costs in the future.
Insurance policies will need to be takenout to cover this. The same goes for rights of way, changes of use etc. Thereare many potential pit falls here to be investigated.
– Review the mortgage offer, are there any specificrequirements from the lender? E.g. “Exchange and completion must occur aminimum of ten working days apart”. – Check for any charges over the title. Hassomebody taken out a loan in the past and used the property as security for it?Is there an existing mortgage on the property? If there is a charge, a thirdparty will have a legal right to the property up to the amount agreed in thecharge. – Check boiler maintenance/ gas safety checks.
Again,certificates will need to be obtained to ensure everything has been checkedrecently and is in working order. Surveys – While these enquiries are ongoing, the buyer(not the buyer’s sol) will arrange mortgage finance and have the propertysurveyed. All buyers should have a survey carried out. You should bewary of relying on your mortgage lender’s survey report because very often theywill have only commissioned a “valuation” and not a full survey. The”valuation” will be limited to advising them that the property is worth themoney they are lending.
Many lenders will not release their surveys. If yourlender gives the option of paying a little more for a full survey (which youwill receive a copy of) we would advise you to take advantage of that offer. Otherwiseyou should instruct your own independent surveyor to carry out a survey foryou.Unfortunately when enquiries are raised they don’t alwayscome back in one go. Often it involves chasing the other side’s solicitors fordocuments, with replies to enquiries coming in dribs and drabs.
It is only onceall enquiries have been responded to and your solicitor is confident allpotential issues have been addressed, will they proceed. Once mortgage offer, searches and enquiries are allsatisfied, we will request deposit monies (from buyers) in preparation forexchange. ExchangeUnderstandably people are very keen to arrange dates forexchange and completion. These are the final stages. Once these are set you areon the home straight to buying/ selling your property. Once both sides are holding signed contracts and depositmonies received (these can take 3-5 working days to clear via BACS transfer),we are ready to exchange.
Your solicitor will phone the other side’s solicitors,date the contracts and transfer your deposit (usually 10% of purchase price) tothe other side. Remember, once contracts have been exchange you will belegally bound to complete on the date agreed. If you fail to complete the transaction on the completiondate yu will have to pay interest to the seller. Rates of interest for latecompletion are set out in the contract.
If the transaction fails to completeyou will lose your deposit (in the case of the buyer) and may be sued for theother parties losses. Pre completion Between exchange and completion solicitors will carry outsome final searches e.g bankruptcy search to ensure buyers are still solventand OS1 searches to make sure no new interests have been registered against thetitle since the initial searches were carried out. The latter ensures the property will besuitable insurance for lenders.
If it has not yet been done, the mortgage deed and transferwill now be signed. Finally you will be sent a completion statement setting outexactly the amount coming into your account from sale monies/ mortgage advanceand what will be coming out- solicitors fees/ land registry search fees etc. Arrangements will be made for moving into the property. Completion Funds will be transferred from buyer’s solicitors to sellers.
As this point you will officially own the new property and keys will beavailable for the estate agents on collection. As previously mentioned, if completion does not take placeby the time appointed in the contract (normally between the hours of 12-2 pm)and the delay is caused by you, the Seller will be entitled to charge youinterest. In addition, you may be charged for their solicitor’s costs inserving any notices (typically between £75 -£200 plus vat) as a result of latecompletion.