The actual legal process involved in transferring the ownership of a house from one person to another is called conveyancing. Though it is perfectly legal to do this yourself, most mortgage lenders and even sellers will prevent you from doing so, therefore it is advisable to contract the services of either a solicitor or a conveyancing firm. Before deciding on any one firm get a range of quotes and always check that conveyancing firms are licensed to practice with the Council for Licensed Conveyancers. There are three main steps to the conveyancing process:
- 1. Pre-exchange of Contracts.
- 2. Exchange of Contracts.
- 3. Completion.
1. Pre-exchange of Contracts
1.1 Your solicitor and the seller exchange details, your solicitor receives a copy of the draft contract which they send to you, this outlines:
- The seller’s and your details.
- Details of prices.
- Which specific fittings are included in the price.
- Details of the sellers title deeds.
1.2 Your solicitor checks and negotiates the terms of the draft contract on your behalf.
1.3 Your solicitor applies for standard searches to be carried out. These are addressed to the Local Authority in order to check:
- Upcoming changes to the locality that may affect the property.
- If it is in a conservation area.
- If the building is listed.
- If there is a compulsory purchase order affecting the property.
Additional checks must then be made to the Land Registry and the Water Authority.
1.4. Your solicitor addresses a number of standard inquiries to the sellers solicitor such as:
- Are there any ongoing disputes over the property?
- What are the exact boundaries of the property? Who is responsible for specific fences, hedges etc.?
- Does a public footpath or right of way cross the property?
- Do the deeds contain any restrictive covenants?
- Is the property under guarantee with an authority like the National House-Building Council (NHBC)?
- Is the house under planning restrictions due to past extensions or for any other reasons?
- Are rights of way, road access and/or access to utilities shared by any neighbours?
- If the property is Leasehold, is ground rate up to date and who is the Freeholder?
1.5 Your solicitor will send you a mortgage deed to sign and make the contract formal (not just a mortgage agreement in principle).
Before the next stage (exchange of contracts), a completion date must be decided upon by both parties. On this date you are free to move in. It can take up to two weeks from exchange of contract to completion, or it can be done on the same day. In some cases it suits both parties to delay this stage for up to 6 months, possibly to give the sellers time to move on to another property. If you are both buying and selling or if the sellers are, making what is known as ‘a chain’, then this can vary.
2. Exchange of Contracts
2.1 After contracts are exchanged, you are legally bound to purchase the property. As such, before this stage, consider the following checklist:
- You have the deposit ready.
- Your mortgage offer is in place.
- The surveys are satisfactory.
- Life insurance and property insurance are set up.
- The contract terms have been revised by all parties.
- A completion date has been set.
2.2 You pay the non-refundable deposit to the seller.
2.3 Your solicitor prepares a transfer document which is sent to be signed by the buyer. This deed transfers the property to the buyer from the seller and, once it is agreed, it must be signed by both parties.
2.4 Your solicitor finalises your mortgage arrangements, readying the money for transfer to the buyer upon completion.
2.5 Final searches and inquiries are carried out by your solicitor.
2.6 Land Registry fees must be paid along with Stamp Duty.
3.1. On the date of completion, funds are sent by your solicitor to the seller and the sale of the house is completed.
3.2 You receive the transfer deeds and title deeds.
3.4 You receive the keys and may move in; the buyer must have vacated at a pre-arranged time. Welcome to your new home!