The conveyancing process explained
This is a guide explaining the conveyancing process when buying a home. Conveyancing involves legally transferring home ownership from the seller to the buyer. It starts when your offer on the house is accepted and finishes when you receive the keys. Understanding what it involves will help ensure there are fewer surprises along the way.....
Who does the conveyancing?
A solicitor or conveyancer usually conducts the conveyancing process, but it is possible (although difficult) to do it yourself as long as you are not taking out a mortgage.
- If like most people you are too worried or time-poor to do the conveyancing yourself, the next step is to find a solicitor or conveyancer and “instruct them” to do it for you.
- Your appointed conveyancer will then draw up a draft contract or terms of engagement with you, setting out their charges and deposits required.
- Your solicitor will write to your seller’s solicitor to confirm they are instructed and request a copy of the draft contract and any other details, such as the property’s title and the standard forms.
- Your solicitor will examine the draft contract and supporting documents and raise enquiries with the seller’s solicitor. You will be expected to go through the forms the seller has completed and let the solicitor know if you have any queries or concerns. In particular, you will want to double-check the tenure of your new home: is it leasehold or freehold? If leasehold, don’t rely on your solicitor to check for the length of the lease. Leases below 80 years are a problem, can be costly to extend and you need to have owned the property for two years before you are eligible to do so. Leases under 60 years are best avoided.
- Property searches. There are things you may not know about the property for sale in St Albans just from viewing it with estate agents or even getting a survey. The conveyancer will do a set of legal searches to ensure there are no other factors you should be aware of. Some searches will be recommended by the solicitor for all purchases and others will be required by the mortgage lender to protect them from any liabilities that the property may have:
- Local authority searches: are there plans for a motorway in your new garden? How about radioactive gas? This costs between £70 and £400 depending on the Local Authority and usually takes 1-2 weeks, but can take up to 6 weeks
- Checking the ‘title register’ and ‘title plan’ at the Land Registry– these are the legal documents proving the seller’s ownership. The title register check costs £3, and the title plan check costs £3. Both are legally required to sell.
- Checking flood risk – this can also be done at the Land Registry. If you are getting an Environmental Search, you might not buy this one separately as the environmental search will contain much more thorough flood information and maps.
- Water authority searches – find out how you get your water and if any public drains on the property might affect extensions or building works. The water authority search will cost between £50 and £75.
- Chancel repair search – to ensure there are no potential leftover medieval liabilities on the property to help pay for church repairs. This is a necessity and costs £18. However, you may decide to take out Chancel repair insurance instead for £20 or so. The laws around Chancel repair changed in October 2013, so now the onus is on the Church to establish and lodge liability with the Land Registry.
- Environmental Search – this report is used on the vast majority of transactions and is provided by either Landmark or Groundsure. Depending on which product your solicitor usually uses, the report will give you useful information. You will know the contaminated land at or around the property, landfill sites, former and current industry, detailed flooding predictions, radon gas hazard, ground stability issues, and some other related information. The cost should be around £50 to £60, including VAT.
- Optional and location-specific searches – sometimes extra searches are required or recommended depending on the location or type of property or due to particular concerns raised by the property buyer. These could include:
- Tin Mining searches in Cornwall
- Mining searches in various parts of the UK and Cheshire Brine searches
- Additional Local Authority Questions such as Public Paths, Pipelines, Noise Abatement Zones, Common Land, etc.
- You will need to get your mortgage in place. This will include ensuring you have the financing available for a mortgage deposit. Your solicitor will receive a copy of the offer and go through the conditions.
- You will need to get a mortgage valuation. This is carried out on behalf of the mortgage company, so they know that the property provides sufficient security for the loan. Usually, you have to pay for it, but a mortgage company might throw it in for free to attract business
- You will want to have any other necessary surveys done. Whether you have a survey done and what sort of survey you choose will depend on your specific circumstances.
- Before exchange of contracts can take place your lender will require you to get Buildings Insurance for your new home. You are responsible for the property once the contracts are exchanged, so it is in your interests to do so.
- Signing the contract. Since receiving the draft contract from the seller’s solicitor, your solicitor will have been in correspondence with you about what is covered. Before signing the contract, your solicitor will need to ensure:
- That all enquiries have been returned and are satisfactory
- That fixtures and fittings included in the purchase are what you expected
- A completion date has been agreed between the two parties, which is usually 4 to 12 weeks after exchange of contracts
- That you made arrangements to transfer the deposit into your solicitor’s account so that it is cleared in time for an exchange. You may want to negotiate on the size of the deposit, which is normally 10% of the value of the property. However, even if you agree to pay less than 10%, you are still liable for 10% of the value of the property if you later pull out of the agreement. Therefore if you pay a 5% deposit and pull out of buying the property, you will not only lose your deposit but also legally owe an additional 5% of the value of the property
- Visit the property for sale in St Albans with the estate agent and review the fixtures and fittings inventory list to ensure that everything you paid for is still there and the house has not been damaged in any way
- You and the seller will agree on a date and time to exchange contracts at any time on any given day
- Your solicitor will exchange contracts for you. This is usually done by both solicitors/conveyancers reading out the contracts over the phone (which is recorded) to make sure the contracts are identical, and then immediately sending them to one another in the post.
- If you are in a chain, your solicitor/conveyancer will do the same thing, but will only release it if the other people in the chain are all happy to go ahead. This means if one person pulls out or delays, then everyone in the chain gets held up.
- Once you have exchanged contracts, you will be in a legally binding contract to buy the property with a fixed date for moving. This means that:
- If you do not complete the purchase, you will lose your deposit and owe the seller more if the deposit was less than 10%
- the property seller has to sell, or you can sue them
- the property seller can no longer accept another offer (you don’t have to worry about being gazumped)
Between exchange and completion
- Your solicitor will lodge an interest in the property which will mean that the deeds to the property are frozen for 30 working days to allow you to pay the seller and lodge your application to the Land Registry to transfer the deeds into your name.
- The property seller will move out (although they may leave this to the day of completion)
- You should organise the moving
- The solicitor will send you a statement showing the final figure to pay, which will need to be cleared into your solicitors' bank account at least one day before completion.
On completion day
- Completion is generally set around midday on the specified date although in practice takes place when the seller’s solicitor confirms that they have received all the money that is due. Once this happens, the seller should drop the keys at the estate agents for your collection. You can then move in.
- Your solicitor will tie up some loose ends:
- Pay Stamp Duty Land Tax on your behalf.
- You will receive your legal documents about 20 days after completion after your solicitor has sent them to the Land Registry
- Send a copy of the title deeds to your mortgage lender, who will hold them until you pay your loan off
- Notify the freeholder if the property is leasehold
- Give you a bill for their payment
- You will want to collect together all your paperwork from the purchase of your new home, including the estate agent’s brochure, to file away and keep safe for when you move again.