Buying Your New Home Part II – The First Steps

First of all, I offer my apologies to anyone reading this right now who is hoping to do their own conveyancing. There are a lot of stages and procedures and it may be some time before this series is finished! When I am finished, though, I would hope that you will all have some sort of overview of what I and my fellow property lawyers do to earn our money.

The first step that anyone contemplating buying or selling a property will have to do is choose a solicitor. If you look in your Yellow Pages or Thomson Local, you will see that there are quite a few out there. Some are local, some further away. All are desperate for your business. It is often (but not always) the case that those further away who are advertising in your locality are what High Street Solicitors would term ‘Conveyancing Factories’. With such firms, they carry out a lot of transactions and work in teams. Quite often the people you deal with will not be qualified but will have a qualified lawyer overseeing 20 or more of them. You may find that you will not speak to the same person twice on the telephone. It is also often the case that they will quote for headline costs that sound very low. You then discover the additional cost if there is a mortgage involved, for completing Stamp Duty forms and several other steps.

For some people this is fine. If you are only selling, the property is freehold and you have it mortgage-free, then you will be quids in. However, transactions like that are few and far between. Most people buy when they sell. A huge percentage have mortgages. Your property may be leasehold. You may only be selling part and retaining the rest.

High Street firms tend to be better placed in terms of conveyancing. Usually the lawyer dealing with you will know the area, know what specific items to look for. For instance, would a factory firm in Devon know that you need mining searches for properties throughout Nottinghamshire, but not in Newark or in Southwell? You could end up paying for searches you don’t need without that knowledge and experience on your side.

I know what you’re thinking. To quote Mandy Rice-Davies…”He would say that, wouldn’t he?” My answer is that I do have a position to protect but above are some of the reasons that I work at Tallents and not in a bulk conveyancing firm. We have systems in place to ensure that you have a named person dealing with your file (with bags of qualifications, bags of experience or (more often than not) both). You can always contact that named person and we don’t offer a charter to return calls ‘within 24 hours’ – we will, of course, be much quicker than that. Your advantage is that firms like Tallents rely on your business, your recommendation and want you to come back next time. We have to work hard to earn that from you.

OK…so we’ve looked at some differences in firms. Ultimately, though, word of mouth and recommendations are the best way to choose.

Once you have your solicitor sorted, they will open a file and send you a bundle of documents to review. Unfortunately, we are governed by more and more bureaucracy. Whether we are buying for you, selling, or both, we can no longer allow money to change hands until we are sure of who you are. (Another advantage of using a local firm with whom there may already be strong connections and who know you already). As I often tell clients, the Government has decided that everybody is a criminal and if they get away with it, its my fault! We therefore ask for certain ID documents. This used to be almost embarrassing and people baulked at it, but we’re now in a climate where such evidence has to be produced regularly for all manner of reasons.

When you are selling a property, the next stage is for your solicitor to obtain your deeds. Sometimes these are with a lender (particularly if you took out a mortgage more than 10 years ago). In more recent years, lenders suddenly realised that they were running out of storage space, so the Land Registry adapted its systems and most lenders no longer retain title deeds. Your ‘title deeds’, if there has been a transaction within the last 25 years locally, will be registered at the Land Registry and the worst case scenario is that, if you lose them, less than £10 will get you another copy from the Land Registry online.

However, solicitors generally look for more than this simple document which proves your ownership. Purchasers will be interested in planning consents, warranties, certificates and more. Sometimes a Land Registry Title Information Document will raise issues that only an old deed can provide the answer to.

The additional paperwork I referred to above will include a fittings and contents form for you to complete stating what is included in the sale and what is not, and a Property Information Form. This latter form gives the buyer an indication of some important matters which will not show up on the deeds – have there been any disputes? Who has looked after which boundaries? Have there been any extensions, new boilers, new windows or electrical works? These documents ultimately form part of the contract so you have to fill them in carefully.

So, we now have you identified and we have your paperwork. At this point, I think its only fair to leave you hanging and continue to retain the ‘mystique’ of the Law which is enshrined in words such as ‘indenture’ and ‘easement”.

Part III to follow.

Buying Your New Home – Part 1 – Overview

Happy New Year to you all.

I thought that I’d put together a little series explaining the steps involved in basic conveyancing transactions

These days contracts are usually exchanged over the telephone and most solicitors will call their clients immediately to let you know the good news. It’s safe to crack open the champagne now. Things can go wrong between exchange and completion but it is extremely rare. I have dealt personally with only two cases in 18 years.

In the first one the purchaser died the day before completion was due to take place. It was resolved for the deceased’s spouse and the seller’s were quite understanding so there was no additional cost to my client, although there could have been.  In the second case, the purchaser’s lender had overlooked the issue of funds, causing a lot of stress for the solicitors involved.  However, we were able to get all parties in the chain into their new properties over the weekend under licence and then completed on the Monday.  The only cost here was about £100 in interest along the chain and this was paid by the defaulting party.  As everybody had got into their properties when they expected, I imagine nobody particularly gave it a second thought over that weekend.

Nevertheless there are a number of legal procedures that must be dealt with before completion can take place. The main ones are as follows.

Evidence of title/contract

The vendor’s solicitor will send your solicitor a copy of the deeds or a summary of their content. If your solicitor has any questions he will make enquiries before contract.  He will also carry out the necessary searches.

Draft transfer/conveyance

The vendors’ solicitor will send your solicitor a draft transfer (for registered property) or conveyance (for unregistered property). This is the deed which passes the vendors’ interest in the property to you.

Mortgages

Your solicitor will write to your mortgage lender to ensure that the mortgage money is available in time for completion.

Engrossment of transfer or conveyance

When both solicitors are satisfied with the terms of the deed it will be ‘engrossed’, ie a final version will be prepared for signature by both sides.

Signing of final documents

You will be asked to sign the final documents and provide a banker’s draft (or, more often these days, a telegraphic transfer) for any further money required to fund completion over and above your mortgage advance.

Final searches

Your solicitor will conduct a final Land Registry search in case the vendor has just been declared bankrupt (in which case the property would no longer be his to sell) and to ensure that no last minute charges have been registered against the property. These could affect the mortgage lender’s security.

 

Over the next few weeks, I’ll explain each of these steps in a bit more detail.  The amount of work required for any particular stage will vary depending upon the location of the property, its history and the quality of the package supplied by the vendor’s solicitors at the outset.