For most, buying or selling a house is something the majority of people will only do a handful of times, if that, during their lives. In the legal world, we refer to the process of buying or selling houses as conveyancing.
The conveyancing process may sometimes appear complicated and shrouded in mystery. However, it need not be and that is the purpose of this article the attached infographics. It is my intention to demystify, answer some of the most frequently asked questions and set out the conveyancing process in broad strokes from start to finish.
CHOOSING YOUR SOLICITOR
Your choice of solicitor and relationship with them is one of the most important decisions in the conveyancing process. Choosing the right solicitor will have a bearing on and influence your experience of the whole conveyancing process.
Your solicitor should put you at ease and make the conveyancing process as smooth as possible. They should identify problems and present solutions. You should have a good rapport with your solicitor and feel comfortable picking up the phone to them.
Traditionally most people don’t have cause to be in contact with their solicitor on a regular basis. They can feel intimidated and reluctant to ask questions for fear of being perceived as “stupid”. A good solicitor will be happy to answer such questions. A great solicitor will pre-empt them.
My advice would be to think carefully before choosing your solicitor. Speak to your family, friends, and colleagues ask for their honest recommendations and be informed by their experiences. A referral is the highest form of complement in our business. As with all things in life, generally, you get what you pay for. If you are motivated solely by price, do not be surprised if you’re conveyancing experience is more unpleasant than it need otherwise be.
STEP ONE: LOCATE THE TITLE DEEDS AND GET THEM TO YOUR SOLICITOR
If you are selling your house the first thing you will have to do is locate the title deeds to the property. The title deeds are a collection of documents relating to various aspects of the property. If you have a mortgage on your property the title deeds are most likely with the Bank. In this situation, your solicitor will prepare an Authority for you to sign authorising the Bank to release the title deeds to them. Some banks will charge a small fee for taking up the title deeds. This process can take anywhere from 6-8 weeks, so the sooner you see your solicitor the better.
Your solicitor will need to review and inspect the title deeds in order to prepare the Contracts.
STEP TWO: FIND A BUYER
There is no obligation on you to use an Auctioneer. However, in most cases, we would advise that you do so and choosing the right auctioneer is important. Their experience and knowledge of the local market is invaluable. This can help to ensure that you obtain the maximum value for your property and select the right buyer for your property. If in doubt speak to your solicitor and they should be able to point you in the right direction.
Once a buyer has been identified, the Auctioneer will request that they pay a booking deposit. The purpose of the booking deposit is to show that the prospective buyer is serious and genuinely interested in the property. This booking deposit is fully refundable up until contracts have been signed and exchanged.
STEP THREE: GET ALL THE INFORMATION
Your Solicitor should give you a list of all of the information and documentation they require in order to draft contracts. Typically, this would include proof of payment of local charges and taxes (NPPR, LPT and Household Charge) and planning documentation, if there has been an extension to the property. Once your solicitor has all of the necessary information, they will be in a position to draft contracts and replies to requisitions and send these to the buyer’s solicitor.
STEP FOUR: SENDING CONTRACTS & ANSWER THE BUYERS’ QUESTIONS
Your solicitor will send the Contracts (in duplicate), title documents and replies to requisitions to the buyers’ solicitor.
Once the buyer’s solicitor has reviewed the contracts and associated documentation, they will raise queries and questions on title. The buyer will have carried out a planning search on the property and this may have thrown up questions relating to the physical structure of the property or the boundaries. Your Solicitor will respond to these queries.
Once the buyer’s solicitor is happy that all the questions have been satisfactorily answered they will get their client to sign contracts (in duplicate) and transfer the balance of the 10% deposit to their client account. The buyer’s solicitor will then send the signed contracts (in duplicate) along with the balance deposit to the vendor’s solicitor.
STEP FIVE: SIGNING CONTRACTS
Upon receipt of the signed contracts from the buyer’s solicitor. Your own solicitor will arrange for you to sign the contracts. Once signed, your solicitor will return one of the fully executed contracts to the buyer’s solicitor, at this point a fully binding contract is in place.
STEP SIX: PREPARE FOR CLOSING
If there is a mortgage on the property your solicitor will write to your bank and get a note of the redemption figures. The redemption figure is the amount of money required to clear the loan. Your solicitor will give an undertaking to the bank to withhold the redemption amount from the proceeds of the sale and will discharge this on closing.
Your solicitor will prepare all of the closing documentation and arrange for you to sign the various declarations and certificates required.
STEP SEVEN: CLOSING
Normally, your solicitor will send all of the closing documentation to the buyer’s solicitor in advance of the agreed closing date. The buyer’s solicitor will transfer the balance of the purchase monies to your solicitor’s client account. These funds will be held in trust by your solicitor pending the closing of the sale.
Once the buyer’s solicitor is happy that all of the closing documentation is in order they will carry out closing searches. They will search against you (the seller) and against the property to make sure no judgements or other burdens have been registered against you or the property.
The buyers’ solicitor will send these searches to your solicitor to be explained and endorsed (signed and confirmed). Assuming nothing turns up and they are all in order, the buyer’s solicitor will authorise the release of the funds and your solicitor will authorise the release of the keys to the buyers. The sale is now closed.
STEP EIGHT: THE MONEY
Your solicitor will redeem (discharge) the outstanding balance of any mortgage on the property. They will also obtain a discharge for this mortgage and forward same to the buyer’s solicitor.
They will arrange for the return of the booking deposit from the auctioneer, less the auctioneers agreed fee.
Your solicitor will then prepare a cash account and fee note for their services. They will transfer the net proceeds of sale to you.