The Conveyancing Process


The Conveyancing Process

Tue 22 Nov 2016 by Lorraine Imhoff

Written by Lorraine Imhoff

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In the context of property, ‘Conveyancing’ is the process of transferring ownership or ‘legal title’ of a property from one person (or company) to another.

The Conveyancing Process is the set of steps carried out by a solicitor or legal representative on behalf of the buyer and seller.

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The time and complexity involved in completing the conveyancing process varies greatly depending on any number of factors including the tenure of the property, difficulties obtaining finance, the competency and workload of the solicitor, other parties in the chain dragging their heels and so on.

Many buyers and sellers are unaware of what the conveyancing process involves and simply place their full trust in their solicitor.  This article sets out to empower the home over with enough knowledge to ensure that they are getting the best possible attention from their legal representative.

The following is divided into sections for buyers and sellers and assumes you have already chosen your solicitor.

(for more information see how to choose a conveyancing solicitor)

Throughout the process, your solicitor should be in constant communication with the buyer/seller, buyer’s/seller’s solicitor, managing agents or freeholder (if leasehold), the lender, the estate agent and any number of other parties.  A good solicitor will take a pro-active stance and push other parties along to reduce delays.

The conveyancing process for buyers

  • File set up stage

    The initial file set up stage is where your solicitor must issue you with a formal written quote along with their terms and conditions, client care letter and complaints procedure. This initial pack of information will also include a number of forms and a request for identification details which must be completed before work can commence on the file.

    Once the requested information and buyers authority to proceed is received, the solicitor will proceed with the initial stages that will include:

    • Allocating a suitable Fee Earner to your case
    • Notifying the estate agent of the solicitor's instruction to act and requesting a copy of the Sales Memorandum (aka Sales Memo) detailing the details and parties involved in the property sale.
    • Processing the initial pack of information and setting up a file
    • Verifying the clients identification from the provided information such as passport or driving license, NI number etc. Increasingly this is carried out using an online service.
    • Returning any supplied identification documents to the client
  • Acquire/review the estate agent's particulars of sale

    Once in receipt of the Sales Memo which contain the seller's solicitor's details, the solicitor will write to the seller's solicitor confirming instructions (and raising management enquiries if leasehold). The solicitor will then:

    • Email Agent confirming receipt of sales memo
    • Apply to the Land Registry for Office Copies
  • Chasing papers from sellers solicitor

    Should there be any delay, a proactive solicitor representing a buyer will chase the sellers lawyer for the initial papers which include things like a draft contract of sale. All too often these papers are incomplete and further chasing results. The client will be advised of any missing documentation and kept informed during these initial stages as they may be able to assist with chasing relevant parties.

    Unless there is a reason not to, the solicitor should apply for Local Authority and other conveyancing searches at this stage as it reduces the chances of delays later on.

  • Enquiries of the sellers solicitor

    Once in receipt of the pre requisite information supplied by the seller's solicitor, the purchasers lawyer will:

    • Approve the contract
    • Submit additional 'enquiries' about the property
    • Report to the client on any provisional issues
    • Send the estate agent a copy of the additional enquiries
    • Identify and obtain suitable indemnity insurance policies where necessary
    • Raise enquiries of appropriate government body
    • Submit further searches - such as Chancel, Coal, Tin and other geographically specific searches
    • Inform the mortgage lender of any issues or concerns
    • Chase the sellers solicitor for replies to enquiries
    • Review replies to enquiries received
    • Chase any missing replies/clarifications to enquiries
    • Run a Lender Issues Report
    • Chase the lender for comments on issues raised

    Once it is ascertain that sufficient replies have been received in relation to the above issues, the buyers conveyancing solicitor will Prepare a Deed of Covenant if required and Prepare, check and send a full Report on Title to the client.

    The agent will be notified that the client is in receipt of the Report on Title

  • Searches

    The searches stage involves the solicitor ensuring they are in receipt of all conveyancing searches and informing the client of any implications. (this advice may already be in the report on title). The Environmental Search results are sent to the client and in the event of a fail an indemnity policy may be advised.

    Further enquiries may also be raised depending on search results and both the client and agent will be advised of progress

  • Mortgage Lender

    Typically the mortgage lender will need to be pushed for issue of the mortgage offer and, once received the client and agent will be advised. The offer will be reviewed and any issues will be reported to the client and or lender where appropriate.

  • Exchange of Contracts stage

    This is stage is the final run up to the Exchange of Contracts which is in essence the point of no return. Should a buyer withdraw after exchange then they will lose their deposit (typically 5-10% of the sale price and may face other costs. The exchange of contracts process includes:

    • Receipt of final signed contract, deposit and completion of necessary accounts statements deposit and generate accounts slips
    • Notification of the agent and client that contract/deposit received
    • Final check and confirmation of satisfactory replies to all enquiries
    • Run pre-exchange checklist
    • Obtain instructions on completion dates and agree with other side
    • Contact both client and lender to confirm authority to exchange contracts
    • Exchange contracts and notify client and agent
    • Draft and send exchange letters
    • Send Certificate of title to the lender and prepare necessary invoices
  • Completion Stage

    Now that contracts have exchanged there are a number of formalities to complete before 'Completion' and the handing over of the keys to the buyer. These include:

    • The submission of pre-completion searches (OS1, K15 etc)
    • Receipt and interpretation pre-completion search results
    • Contact the insolvency office for K15 entries
    • Raise requisition on OS1 results if applicable
    • Chase replies to requisitions
    • Prepare financial statements and pre-completion checklists
    • Contact the lender to confirm they are in receipt of the Certificate of Title
    • Chase the completion statement from the seller's solicitors
    • Receive mortgage advance, clients balance and forward balances to the sellers solicitor
    • Inform the client and agent of completion, draft and send confirmation of completion letters and place any indemnity insurance policies on risk
  • Post Completion stage

    Most buyers assume that this is the end of the process as they have now received keys and in all probability moved into their new home.

    In fact there are still a number of additional tasks that must be completed. These relate to the correct registration of the new owners at the Land Registry along with any charges such as the lenders interest. Also critical is the settling of any stamp duty returns and transferring stamp duty amounts to HMRC.

    These tasks include:

    • Diarise search expiry dates
    • Prepare stamp duty form and payment slips and send stamp duty to HMRC
    • Send form and charge to companies house where relevant i.e. if Freehold Management company
    • Serve notice on the Landlord or Freeholder
    • Send stock transfer form for stamping if management company
    • Chase Deeds
    • Prepare AP1
    • Deal with requisitions
    • Diarise date for retention release if a retention has been agreed
    • Send deeds to the lender and copies to the client
    • Send copies of deeds to client
    • Chase retention release or release retention at later diarised date
    • Release retention

The conveyancing process for sellers

  • File setup stage

    The initial stages of file setup more or less mirror the initial stages of acting for a buyer. However there are a number of additional conveyancing forms that sellers must complete including:

    • FFF - Fixtures and fittings form
    • SPIF - Sellers Property Information Form
    • SLIF - Sellers Leasehold Information Form (where applicable)

    Sellers are advised to complete and return these forms as quickly as possible as these form part of the initial package of information sent to the buyer's solicitor. Without this information the conveyancing process cannot proceed.

    If a property is leasehold another critical stage that should be addressed as early on in the process as possible is to identify and the Managing Agent and request the 'Management Information Pack'.  An astute solicitor will also request any documents referred to but not accompanying the returned conveyancing forms (e.g. Tenancy Agreements referred to in the SPIF)

    The remaining tasks to be completed with the file set up include:

    • Apply for and review the Official Entries, Office Copies of the lease and other Documents from the Land Registry.
    • Chase and review the Sales Memo supplied by the estate agent
    • Write to the buyers solicitor confirming instruction t act for the seller
    • Chase any outstanding Deeds, Redemption Figures from the lender and Management information if relevant
  • The Contract Stage

    The most important part of getting ready to issue a contract is ensuring that all relevant documents are collated and reviewed. This tends to mean the constant chasing of clients, lenders, agents, managing agents etc. Once all of the information has been received the following stages will be addressed:

    • A contract package ('papers') is prepared and sent to the buyers solicitor with an accompanying letter and all parties are notified that the contract package has been issued
    • Any latecomer information such as the deeds, the lease or the management information pack are also sent to the other side
    • The buyers solicitor will then raise a set of enquiries or questions which are forwarded to the sellers solicitor
    • These enquiries are addressed as quickly as possible and the client will probably have to provide input at this stage
    • The contract, TR1 form and Stock Transfer Forms are sent out and the agent is notified
    • It is usually necessary to chase the lender for a redemption statement on the mortgage at this stage and once received this is sent to the client
  • Preparation for Exchange of Contracts

    Once the signed contract and completed forms (TR1) are received back from the client, the sellers solicitor will run through a lengthy pre-exchange checklist to ensure no detail has been overlooked. The solicitor will then seek to obtain instructions relating to completion dates and broker the agreement of these details with the other side.

    The client must then provide authority to exchange contracts and all parties are subsequently notified once exchange occurs. Exchange is also formally notified in writing from the solicitor.

    A further redemption statement must be requested from the lender as the situation may have changed since the last statement.

    Further financial matters such as obtaining final ground rent (and service charge receipts must also be obtained if the property is leasehold), invoices are prepared and the deposit is awaited from the buyer.

  • Completion

    Completion formalities are somewhat more straightforward when selling as the registration process is handled by the buyer's solicitor. However there are still a number of loose ends to tie up including:

    • Preparation and dispatch of financial and completion statements to the client and the buyer's solicitor.
    • Internal accounts slips need to be prepared and signed off
    • The agent and client are notified of formal completion and keys can be issued
    • Any indemnity policies must be 'placed on risk'
    • If any money has been held over pending a post completion event (this is called a 'Retention') this must be noted and diarised accordingly.

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