Author: Mike Steele
When you are buying or selling a property, one of the first questions the estate agent will ask you is who your conveyancing lawyer is. Many people will instruct a lawyer to carry out the work for them but will not know what that will actually involve.
Different transactions may require different work to be carried out, but the conveyancing lawyer will generally carry out the following:
If selling the property, the first thing your lawyer will ask you to do is complete some forms, the main two being the Property Information Form and the Fittings & Contents Form.
The Property Information Form contains a wide range of questions and is designed to provide the buyer and their lawyer with a wide range of information about the property. The Fittings & Contents Form contains details of the items in the house that are included in the sale, or excluded from it.
Upon receiving the completed forms, your lawyer will check through them and send copies to the buyer’s lawyer together with a draft contract, which sets the terms upon which the transaction will take place. The seller’s lawyer will also provide evidence of the title to the property, which nowadays comes as a downloadable Land Registry entry (if the land is registered, as is the case the vast majority of the time).
Upon receipt of the contract papers, the buyer’s lawyer will look through the paperwork to check whether there are any legal issues the buyer needs to be aware of. They will also ask any questions they have about the property (known as raising enquiries) of the seller’s lawyer. At the same time, they will also apply for any searches to be carried out on the property.
If the buyer is obtaining a mortgage, the buyer’s lawyer will also review the mortgage offer and report on the terms of that to the buyer. The buyer’s lawyer will also make sure that the instructions of the mortgage company are adhered to, as they usually also act as the mortgage company’s legal representative in the transaction.
Preparing for exchange
When enquiries are received from the buyer’s lawyer, the seller’s lawyer will answer any questions they can from the paperwork they have been provided with, or contact the seller for answers to those questions and provide replies to the buyer’s lawyer.
The buyer’s lawyer will then review all the replies to enquiries, together with the results of the searches and report to the buyer on all matters, before asking them to sign all the documentation. The seller’s lawyer will also obtain the seller’s signature to the contract and Transfer Deed. The documentation is not legally binding until contracts are exchanged (see further about exchange of contracts below), and so the documentation is signed at this stage if possible so that the transaction can proceed smoothly later. At this stage, the lawyers will also negotiate a date for the transaction to take place (the completion date), taking the instructions of the buyer and seller the suggested dates.
Exchanging contracts and completion date
Once a date for completion is agreed and the buyer’s lawyer is satisfied with the replies to enquiries and has satisfactory search results, the transaction proceeds to exchange of contracts. Exchange of contracts is where both parties become legally bound to the transaction on the completion date they have agreed. A deposit from the buyer (usually 10%) is required by the contract and is payable upon exchange of contracts. In order to exchange contracts, the lawyers go through all terms of the contract over the telephone to ensure that they both have the same contract containing the same terms. When all terms have been run through, the lawyers confirm the time of exchange and send the signed contracts they are holding to each other through the post, hence the term ‘exchange of contracts’.
If the buyer requires a mortgage, the buyer’s lawyer will also request mortgage funds from the mortgage company for the date of completion.
On the completion date, the buyer’s lawyer sends the monies due to the seller’s lawyer. When the money is received by the seller’s lawyer, they will inform the estate agent that they can release the keys to the buyer for them to collect. The seller’s lawyer will also pay off the seller’s mortgage (if there is a mortgage) and send any money left after that to the seller. The seller’s lawyer then sends the signed Transfer Deed to the buyer’s lawyer.
Registering the property
Upon receiving all the documentation they require, the buyer’s lawyer registers the purchase at the Land Registry who update the register to show the buyers as the new owners.