A comprehensive guide to conveyancing

 

 

 When buying or selling a house, a conveyancing legal expert is a key part to the process.  

Conveyancing can be the most complex part of moving to a new house for homeowners. Here at Versus Law we understand the frustration that can be felt when paperwork stands in the way of you purchasing or selling your home and do our best to make the experience as efficient and professional.  

What is conveyancing? 

Conveyancing is known as the legal process of transferring ownership of a property from one individual to another. It encompasses the entire body of legal-administrative work undertaken to allow for a house sale or purchase to be legally valid and the work is usually undertaken by a conveyancing solicitor. At Versus Law we deal with both commercial and residential properties.

Can I do the process independently? 

It is possible for homeowners to undertake conveyancing themselves. However, this can be extremely complicated and time consuming. It may also lead to errors being made which could open you up to legal issues down the line.  As specialists here at Versus Law, we have the expert knowledge that is needed should your transaction become complex. We cover all types of properties such as freehold and leasehold properties as well as other niche types of contracts. 

What are the costs of conveyancing?

The cost of conveyancing services vary depending on the property.  At Versus Law we have a handy calculator you can use to get a free no obligation quote.  

How long should the conveyancing process take?

On average, the process takes between eight and 12 weeks in total. However, this can vary case to case. 

Here is a breakdown of how it works: 

Phase 1: 

• Commence communication with the seller’s solicitor to attain the contract pack 
• Conduct a survey by a regulated chartered surveyor 
• Have the offer on the property accepted 
• After the valuation has taken place liaise with the mortgage lender to approve the mortgage 

Phase 2:

• Request and obtain a copy of your mortgage offer
• Carry out local authority searches

Phase 3:

• Examine the contract pack, results of local authority searches and mortgage offer
• Consider likely completion dates and negotiate a date with your seller’s conveyancing provider

Then, you will:

• Communicate with mortgage provider about most suitable completion dates
• Analyse the information, asking any questions about anything you haven’t understood 

And finally, you will sign the final contract and return it to us– your solicitors.  Once this is signed you are bound to purchase or sell the property. 

Phase 4:

• Notify the seller’s solicitor and inform them you wish to advance with the contract exchange
  

You will then:

• Send off the deposit to your conveyancing provider – us.

Phase 5:

As your conveyancing provider we will:

• Exchange signed contracts with the seller’s conveyancing provider

Send the deposit to the seller’s conveyancer

Exchange to Completion:

Phase 1:

As your conveyancing provider, we will then:

• Arrange the completion statement and send it to you
• Prepare priority searches
• Advise you about arranging building insurance

Phase 2:

Your conveyancing provider will:

• Organise the transfer deed

You will:

• Study, sign and return the transfer deed

Phase 3:

We will then:

• Send the signed transfer deed to the seller’s conveyancing solicitor
• Ask for the finances from your mortgage lender

Phase 4:

As your conveyancing provider we will then:

• Make the payment for the house to the seller’s conveyancer
• Obtain title deeds, handover deeds and proof of any unpaid mortgages you have redeemed

You will then:

• Collect the keys to your new house once given the go ahead by the seller’s solicitor
• Make the move into your new home!

Phase 5:

We will then:

• Provide the stamping office the transfer deed and any applicable stamp duty 
• Send documents to HM Land Registry to register your ownership of the property

Phase 6:

As your conveyancing provider we will then:

• Receive title deeds from HM Land Registry and send them to your mortgage lender if they have provided finance, or you if you are a cash buyer

It is important to note that although the process above is what is typically followed sometimes in the case of a complex case delays may occur.

 

Estate agents contracts

 

Estate agents contracts

It can be complicated as different estate agents can have differing contracts for selling your property, but you must be aware that an estate agents contract is a legally binding contract that you should read thoroughly and understand, any point that you don’t find clear or understand you need to ask the agent who is potentially selling your property to clarify these points.

The types of contract offered are as below.

Sole seller agreement

This contract reserves the right of the agent to sell your home exclusively during the term the contract is signed for and will even include finding a buyer in this time yourself , the Agent can insist you still pay the signed for agent fee .

Sole agency agreement

This you will find as the most common agreement offered by an agent, it can bare resemblance to the sole seller agreement, the main premise of this contract is to restrict the sale to the one agent you have signed the contract with, if you sell the property through another agent in this time you could still be liable to pay the fee of the agent you signed the sole agency agreement with. If you find your own buyer you are under no obligation to pay the sole agent their fee as it only covers selling through agents and not something you have done personally.

Multi agency agreement

With a multi agency agreement, you are free to use several agents, whoever sells your property the fee will be due to them, Agents do not like multi agency agreements and for this reason will hike the fee sometimes up to 3 times more than a sole agency agreement. Multi agency agreements are more expensive but serve a purpose if you need a quick sale and having it will multi speeds up the sale as it is being sent out to more potential buyers. Agents do not like these agreements as they spend money on advertising and marketing the property only to have it sold by another agent.

Please make sure you read through the agreements fully, refer it to the agent if you don’t understand any of the points in the agreement, and if still you are unsure refer it to a solicitor to check the terms for you. Some of the things that will be in the agreement are listed below with some explanation.

•  Tie-in period

Most estate agents will include a tie-in period for their agreement which will, typically, be around six weeks. The notice period will be between one week and four weeks. It's important that you review these details carefully because some estate agency contracts may keep you legally tied to them for up to six months.
 

• Cancellation fee

You should check the estate agent’s agreement to see whether there is a cancellation fee, which is for when you switch to another agent or if you decide to withdraw your home from the market.
 

• Marketing fees and extras

One of the issues with estate agents is that some will win business by charging what appear to be low fees but then they need to add extra costs into the agreement. This means you'll need to appreciate terms such as marketing fees and extras, as well as being charged for Energy Performance Certificates (EPC) which really should be seen as a standard cost as part of their commission.

 

Leasehold Homes

 

 

Leasehold is an ownership of a piece of land or a building for a certain period of time, when you buy a new property or piece of land that is leasehold, you are known as a lessee, you will own the land or property for the period of time stated on the lease agreement, the freeholder of the land with the use of a solicitor will draw up a lease for a specific amount of time, the freeholder can also be known as a lessor or landlord.

When buying land or property that is leasehold, the longer the lease the more valuable it is if it is resold in the future. The reason 99.9% of flats with more than one unit in a block are leasehold is due to the fact there will be communal space around the flat and one flat might be on top of another, this means its more practical for the whole building or block to be owned by a freeholder who would make arrangements for the communal areas to be looked after by a management company or if small enough by themselves as a freeholder. This means that the leaseholders would not be in constant dispute about who is responsible for looking after areas that are shared by the owners of the units. This usually means that the Freeholder or management company will levy a charge often referred to as a service charge that is payable annually to cover the cost of maintaining the communal space , this could include gardens, hallways , lighting and roof etc .

Also the freeholder has a right to charge for the ground that the leasehold property stands on and is referred to as ground rate that is mostly charged annually to the lessee. It is always advisable to make sure when buying a leasehold property that you are aware of any additional costs are levied like service charge and ground rent as you might get an unpleasant surprise as services charges can be in the 1000’s especially if a car park or gym is provided in the complex.

Also if buying in an older complex in a big block planned maintenance for the complex might be coming due , Complete roof replacement , cladding for the building , complete redecoration of hallways or replacement lifts etc that could mean huge bills being passed down to the leaseholder. Getting you solicitor to uncover this is recommended and usually is done a part of the job they do for you as standard.  Also your solicitor will look for strange clauses that affect the lease, that might be a immediate problem or a problem that will be in the near or distant future.

When buying leasehold property, if a mortgage is needed to buy the property the length of the lease will have a real baring getting the mortgage accepted, most lenders will have a minimum lease length. If you have set your heart on buying a particular property with a short lease it is possible to negotiate with the freeholder for the lease to be extended. This can be expensive depending on how greedy the freeholder is and can amount to tens of thousands.It is sometimes possible for a mortgage lender to agree to covering the cost of a lease extension if it fits within their loan to value criteria, this would mean the valuer sent by the lender will be asked to value the property taking into account the lease will be extended on completion of the purchase. This would mean that the completion and lease extension needed to be simultaneous so that the mortgage funds would be available to pay for the lease extension and the property.

 

Second charge loans on property

 

The Mortgage that you get to buy a property are usually 99.8% registered as a first charge , this means this mortgage will have the main priority in getting the lenders money back if the property is ever repossessed . If you own a property and it is worth more than the mortgage that is placed on it this is called equity.  It is possible to borrow money against this equity by remortgaging the property with another lender who will pay off the existing lender and register their charge as a first charge. You can approach the existing lender for a further advance that will be register with the main mortgage as a first charge.

The other option is to secure a loan on the property on top of the mortgage, this is what is called a second charge mortgage or loan, and it has second priority to the original mortgage and is paid off after the mortgage if the property is repossessed, this means securing the loan as a second charge is a lot more risky due to having priority after the main mortgage, if the property needs to be repossessed and the equity has been eroded by a recession or a major event in the property market the second charge lender might not be able to recover its money . For this reason the interest rate on second charges are greater to cover the extra risk of the higher prospect of not getting all or none of the money back in the event of repossession.

Second charges were free off regulation before 21^st March 2016, but now they are regulated by the FCA and are afforded the main strict affordability checking a first charge mortgage is subject to. When borrowing as a second charge the cost of the first charge mortgage payments, all the other expenses for cost of living and other credit cards and unsecured loans , so it might be less affordable to take out a second charge mortgage than it would be to take a further advance or remortgage .

Second charge mortgages usually go anywhere from a loan of £1000 right up to £250,000 and beyond depending on available equity in the property. The second charge lender will work out how much equity is left after the mortgage and second charge is put on the property, this is usually down to many factors, the type of security, the credit status off the applicant and the amount being borrowed.

Advantages of a second charge

1.       If you have a very good rate with your existing mortgage and remortgaging would mean you losing this rate then a second charge might be a better option.

2.       If you have acquired bad credit after taking your original mortgage, it might be easier to get a second charge other than re-mortgaging as second charge lenders do offer in some circumstances a wider range of products for adverse subprime clients.

3.       In most circumstances  getting s second charge completed is quicker than remortgaging as many of them offer an in-house legal service that is included in the price of the second charge package , so you are not relying on a third party solicitor to complete the matter .

In summary getting professional advice on the best option is always advised.

What are building regulations?

 

 

What are building regulations?

Building regulations are a national standard for most types of buildings in England and Wales; they cover building projects in the home or commercial developments. They are set out to make sure that when something is built, it will be up to a standard that will be a safe environment for people to live and interact with. Building regulations are adjusted as time goes on to make sure they are current with the changing times like making sure the building matches current energy conservation requirements for fuel and power , also for public buildings they must meet requirements for providing access and facilities for disabled people .

For anyone that is planning to start a project to build a structure on their home, if you visit LABC’S home and build website, you will find a lot of helpful information to guide you what the rules are and what you need to do.

Buildings regulations are spate to planning permission, Planning permission something the local authority needs to approve before a building is started and are approved from plans drawn up by an architect, buildings regulations set a safety standard that the build needs to meet and to get a buildings regulation sign off, but you must check before starting the project if planning permission is needed from your local authority. It would be very costly if you finish a build without planning permission as the local authority could make you take the building down.

LABC

This stands for Local Authority Building Control, they represent all local authorities in England and Wales.

Go to this link if you are thinking of starting a new project 

 https://www.labc.co.uk/homeowners/getting-started-your-building-project