The following is a step by step guide to the conveyancing process if you’re the buyer. The process is similar, but slightly different if you’re the seller.
The basics in a nutshell
Conveyancing is the process of transferring legal ownership of a property.
It starts when the seller accepts your offer to buy and ends when you receive the keys.
Conveyancing is usually carried out by a solicitor or a licensed conveyancer, but if you’re not taking out a mortgage, it is possible to do it all yourself.
When buying, as well as the legal transfer of ownership, the purpose of many of the stages of the conveyancing process is to make sure that the seller is the owner with the right to sell to you, and that you are aware of any potential issues or restrictions before you commit to the purchase.
If you are buying with a mortgage, your conveyancer also acts for your mortgage lender, making sure that the property is sound security for the loan and that you are who you say you are.
Conveyancing is a process, not a skill (although experience can be valuable to identify possible problems). The most efficient conveyancers tend to be organised and task focussed.
In 2020, conveyancing fees for the purchase of an average freehold property tend to be in the range of £700 to £1,500. In addition, other expenses will be payable, and depending on the value of the property, you as the buyer may also be liable to pay Stamp Duty Land Tax.
For a straightforward purchase, with a short chain, from start to finish the conveyancing process takes between 8 and 12 weeks.
30% of purchases fall through, usually because of delays in conveyancing, so speeding up the process where possible is important if you want to secure your new home.
Before you make an offer
Obtain a mortgage decision in principle (DiP)
Shop around for the mortgage that suits you best. Although the lender offering the lowest interest rate may seem attractive, other factors may also be important to you.
Obtain quotes, and when you find the best deal, complete all the application forms so that the lender gives you an agreement in principle.
A decision in principle is a statement that the lender will let you borrow up to a given amount for certain subject to the property you make an offer on meeting certain criteria.
A DiP gives a seller reassurance that you’ll be able to finance the purchase and that you won’t slow the conveyancing process down by having to find a bank willing to lend to you. In other words, a DiP makes a seller more likely to accept your offer.
Find a conveyancer
You don’t have to use the conveyancer recommended by the estate agent. The recommendation is likely to be based not on the service that the conveyancer gives (which might be excellent or poor), but rather that the agent receives a referral fee. Some of this referral fee will be passed on to you.
Conveyancing can be carried out at distance, so you don’t need to find a conveyancer who is geographically close to you or the property you’re buying. There should be no need ever to meet your conveyancer in person. An online conveyancing service may be cheaper than a local branch of solicitors.
Ask friends and family who have bought or sold a property recently about who they used and whether they received a good service.
Find the best person in the firm or company and ask for that person to be assigned to your work. Although good firms tend to put efficient processes and systems in place, there will always be one or two people in the team who are more experienced, or more motivated to help you.
Check that your conveyancer is on the panel of approved conveyancers for the bank or building society from which you’ve obtained a Decision in Principle letter. If your choice of conveyancer is not on the list, your mortgage lender will not let him or her work for it.
Protect against the costs of abortive transactions
Because many purchases fail, you may want to use a conveyancer who charges on a no completion, no fee basis.
You can also take out a homebuyer’s insurance policy (for under £50), which allows you to claim back survey and search fees (which can be over £1,000).
Instruct your conveyancer
Asking a solicitor or licensed conveyancer that you would like them to work for you is known as instructing.
You’ll need to provide the contact information of your conveyancer to the estate agent soon after making your offer. If you have a conveyancer lined up in advance of your offer, persuading the seller that you’re a serious buyer who can complete quickly is easier for the estate agent.
Your conveyancer will send you a Letter of Engagement and a Client Care Letter and possibly other documents, which together form your contract with him or her. Read the contract through carefully, particularly so that you know what costs there are. If you are unsure about anything, ask the conveyancer.
In order to be able to handle client money (and protect against money laundering), conveyancers need to carry out “Know Your Client” checks. You’ll be asked to provide certified documents that prove your identity, such as your passport or driving licence, and documents that prove your address, such as utility and council tax bills.
You’ll also need to prove that you are able to finance the purchase, by providing bank statements and the Decision in Principle letter if you’ll have a mortgage.
You will be asked to provide money on account to pay for searches and other expenses. Usually this amount should be under £500.
Sign and return the engagement letter and the other documents as soon as you can, and then send all of them by tracked post so you can check that they have been received. When they have, telephone your conveyancer to make sure that he or she will start working for you promptly.
From offer (and acceptance) to exchange of contracts
Make an offer
Once the seller accepts your offer, the conveyancing process starts.
Ask the estate agent to ask his or her client to take the property off the market (i.e. no longer advertise it or show other potential buyers around). Most agents will advise the seller to do this if, within 14 days, you provide to the agent the contact information for your conveyancer (who you must have instructed) and you book a mortgage valuation survey or building survey.
The estate agent should send a Memorandum of Sale document to your conveyancer as soon as you give the agent the conveyancer’s contact information.
Contact your conveyancer and tell him or her that your offer has been accepted and ask that he or she tells you (by email or telephone) when he or she receives the Memorandum of Sale. Also ask for a provisional completion date.
Write down a list of questions about the property that you would like your conveyancer to ask the seller to answer. For example, you might want to ask about rights to use parking spaces. Send these questions to your conveyancer so that he or she raises matters of particular importance to you with the conveyancer acting for the seller.
Obtaining information
Your conveyancer will ask the seller’s conveyancer for a copy of the draft contract and a copy of the sale pack. The sale pack contains copies of: the title deeds, the lease (if the property is leasehold), the completed Property Information Form, the seller’s Leasehold Information Form (if the property is leasehold) and the Fittings and Contents Form.
When he or she receives these documents, he or she will review them (giving you a copy of each to read as well) and then raise further questions known as additional enquiries.
You should send the mortgage valuation report and building survey to your conveyancer as information in these reports may influence what questions are asked as additional enquiries.
Your conveyancer will also request searches. These usually include:
- Local authority searches, which report on local planning issues and transport infrastructure schemes.
- Checking at the Land Registry the title register and title plan, which together confirm that the seller is the legal owner of the property.
- Water authority searches, which report on whether the property is connected to the mains water supply and drainage systems.
- Environmental searches, which report on environmental and wildlife issues, such as whether the property lies on contaminated land, or whether protected animal species live on the land.
- Chancel repair searches, which check that the owners of the property are not required to contribute to local church repairs (a relic of medieval rights of the Church). If you could be liable, you can take out Chancel repair insurance cheaply.
Your conveyancer may also carry out other searches, such as those that report on flood risks or radon gas levels, either because the property is located in a known risk area, or as a result of answers given by the seller.
Your conveyancer will investigate potential issues and will ask the seller’s conveyancer or your Local Authority for any further information if necessary.
If you are buying a leasehold property, check that the lease has at least 82 years left of the term otherwise you might not have enough time to exercise your automatic right to extend it. Extensions with fewer than 80 years remaining are more expensive to obtain, and you can’t extend a lease until you’ve owned the property for at least 2 years. If there are fewer than 60 years remaining on the lease, you might consider withdrawing your offer to buy – these leases can be very difficult and very expensive to renew.
Secure the mortgage
Complete the documents your mortgage provider has requested, and when the lender provides terms and conditions, pass these to your conveyancer so he or she can arrange for funds to be made available when required.
Your lender is likely to give you standard contractual terms that are non-negotiable. Your conveyancer should read through them and bring to your attention any unusual points. But you shouldn’t expect to be helped to decide whether the mortgage is right for you.
Review your conveyancer’s report
Once all information has been collected, your conveyancer will report on it.
You should read the report (several times) and ask questions or request that your conveyancer asks the seller for more information on matters that you don’t think have been disclosed to the level you would like.
Be aware that your conveyancer might assume that you know what you’re buying and rely on you to think about the risks related to it.
As examples: he or she might not know that you have agreed with the seller to buy the fixed wardrobe in the master bedroom; or a recently constructed garden shed may not appear on the plans yet appears to be a permanent structure.
Sign the contract
When you and your conveyancer feel that full information about the property has been obtained, your conveyancer will send you the contract for the purchase and Form TR1, which is the form that actually transfers ownership.
If you are happy to proceed, return both the signed contract and Form TR1 by next day recorded delivery. Ask your conveyancer to confirm receipt.
Transfer the money for the deposit
Before you exchange contracts, your conveyancer will need to have the money for the deposit as cleared funds in his or her client account.
The amount of the deposit is negotiable. It is usually 5% to 10% of the value of the property.
If you’re in a chain, it may be possible for you to use your buyer’s deposit as your own, even if the amount is lower than your agreed deposit percentage. However, even if you don’t pay all of the deposit, you’ll still be liable for it if the purchase falls through.
Set the completion date
The completion date is the date you receive access (keys) to the property. Your conveyancer will agree a completion date with the seller’s conveyancer. This becomes a contractual term of sale.
Most parties usually agree a completion date that is 1 to 4 weeks after exchange of contracts, depending on your need to move in and the seller’s need to remain in the property until he or she has a new home to which to move.
Take out building insurance
Your mortgage provider will require that the property is insured before making the loan. You will need to buy a building insurance policy and provide confirmation of it to your conveyancer.
Exchange of contracts
Until you and the seller both sign the contract, either of you may still pull out of the deal.
If you are in a chain, exchange of contracts can only take place when your buyer is also ready to exchange on your current property.
Your conveyancer will ask you for authorisation to exchange. If you give it, he or she will arrange a date and a time to exchange contracts.
The two conveyancers need to make sure that the contracts they hold are the same. In the past, one would travel to the other so that both could verify that the other’s contract matched his or her version. However, nowadays, it is more common for exchange to be carried out in a recorded telephone conversation, where each side reads his or her contract, and then immediately sends their copy to the other (usually by email and then by recorded post).
From exchange of contracts to completion
Prepare to complete
The time period between exchange of contracts and completion allows both you and the seller enough time to arrange to move house: organise a removals company, packing and notifying utility providers of the change of address.
Your conveyancer will send you a completion statement, which will breakdown how much money you need to transfer to the conveyancer before completion. This will include all conveyancing expenses, including your conveyancer’s fees, search fees, the Land Registry fee and Stamp Duty Land Tax (if payable).
It is advisable to transfer this money as soon as possible, as it needs to clear at least one before the day of completion.
You will need to sign the mortgage deed so that the mortgage can be transferred to the conveyancer as well.
Your conveyancer carries out pre-completion searches – an additional check to make sure that nothing has changed that might affect the value of the property.
Completion
The seller’s conveyancer must have Form TR1 signed by the seller.
This form will be exchanged for the balance of the purchase price, which your conveyancer will transfer electronically to the seller’s conveyancer. The seller’s conveyancer will confirm to the seller that he or she should give the keys to you (or more usually, to the estate agent for you to pick up when convenient).
Most transactions complete between 12pm and 1pm.
The property is then yours, and you can move in.
After completion
There will still be tasks to complete after completion.
Your conveyancer will pay Stamp Duty and file a return to HMRC.
He or she will also send Form TR1 to the Land Registry with the mortgage deed. These register you as the new owner. He or she should confirm to you that this has been done.
Within a month, the Land Registry should confirm that you are the new owner by sending your conveyancer a copy of the title deeds. Your conveyancer will send these to the mortgage lender (if you have a mortgage) or to you.
If you have bought a leasehold property, your conveyancer will notify the freehold owner that you are the new leaseholder.
You should register for Council Tax with the local council.
Make sure that you keep safe: insurance documents, indemnities, surveys, the Property Information Form, boiler servicing records, electrical installation certificates and guarantees.