Freehold Purchase Conveyancing

Warning: Before using this service please refer to the disclaimer at the foot of this page

What follows in this page is a comprehensive guide to acting for the buyer in the purchase of a registered freehold property. It is separated into sections, so that the reader may study the whole document, or else skip to those topics which are of particular interest. In theory, this page should provide sufficient guidance to allow a layman to conduct his own conveyancing, however this course of action is not without risk. Some of the more common pitfalls are discussed in a separate page - DIY Conveyancing Risks. It is recommended that anyone planning to do their own conveyancing reads this page first. Whilst it is hoped that I have covered the majority of issues here, it is impossible to cover everything, therefore if you do not find the answer you seek, please use the link on the right to contact me by e-mail.

For Conveyancers - Obtaining Instructions

As with any matter which a conveyancer would deal with on behalf of a client, the first stage is of course to obtain written instructions. You should obtain confirmation of the full property address, purchase price, the selling agent's details and you should enquire whether the buyer will be obtaining a mortgage. Whether or not you operate on a no exchange, no fee basis it is wise to collect a sum of money to cover the costs of disbursements (expenses) you will incur prior to exchange, such as conveyancing searches. Having funds on account can save time further down the line.

If you are acting for joint buyers you should also enquire as to whether they wish to hold the property as Joint Tenants or Tenants In Common.

Once instructions have been obtained you should write to the seller's conveyancer (details can usually be obtained from the selling agents) to confirm you are instructed and to request a contract package.

Estate Agent Particulars

Where possible a copy of the estate agent's particulars of sale (with photograph) should be obtained. There are several things that could be picked up from the estate agent's particulars, such as signs that the property has been altered or extended (in which case planning permission, building regulations approval and/or covenant consent may have been required), boundary discrepancies, breaches of covenant etc. If a particular deadline has been imposed on the transaction, this may also be revealed here.

The Contract Package

The Contents

The first stage in the conveyancing process when acting for a purchaser will be to receive the contract package from the seller's conveyancer. A contract package in respect of a registered freehold property should contain at least the following:-

• A draft contract

• Official Copies of the Registers of Title

• A completed Seller's Property Information Form

• A completed Fixtures, Fittings & Contents Form

In addition there may be other documents in the contract package such as a Disclosable Overriding Interests form, copies of any title documents referred to in the Official Copies, copies of any planning permissions and copy guarantees etc.

Checking the Contract for Sale

The first stage is to check the contract for sale. A full tutorial on contracts for conveyancing can be found by following the link. The points to check are that the seller's name matches that of the proprietor on the Official Copies, the buyer's name matches that of your client, the price is correct, the property address is correct and the title number matches the title number of the Official Copies provided.

Usually two copies of the contract will be provided. If you wish to make any amendments these should be made to the spare copy (sometimes referred to as the travelling draft) which should then be returned to the seller's conveyancer together with any pre-contract enquiries you wish to raise on the contract package.

Checking the Official Copies

Click the link for a full tutorial on checking the Official Copies. They should be studied carefully, and any rights or covenants should be reported to the purchaser at the final reporting stage. You should ask the seller's conveyancer for copies of any documents that are referred to, except where the relevant details are set out in full in the Official Copies. If there are relevant details not set out in the Official Copies then the land registry will hold a copy of the document on file, and it will say "Copy filed" after the entry relating to it.

You need to check that the registered proprietor is the same as the seller named in the contract, or that any differences are explained in the contract, and you need to check for any notices or restrictions, as these will need to be removed (or in the case of a restriction, which in some cases will need to remain, satisfied) as part of the sale.

Finally, you will need to check whether there are any charges registered, so that you can ensure that on completion you have undertakings from the seller's conveyancer to discharge them.

Sellers Property Information Form

The Seller's Property Information Form (click the link to view a blank form) is a Law Society standard form and it contains a list of pre-contract enquiries to be answered by the seller. The form is largely self-explanatory and should be forwarded to the purchaser at the start of the transaction so that he may request his conveyancer to enquire further about any points of interest.

For a more detailed explanation of the questions in the form follow this link:- Sellers Property Information Form.

The purchaser's conveyancer should note that where the seller answers "not known" or "not to my knowledge" or some variation on those words, then it means exactly that, and does not imply that the seller has made any investigations or enquiries before completing the form. This should be made clear to the purchaser.

Fixtures, Fittings & Contents Form

This form should be completed by the seller and forwarded via the conveyancers to the buyer at the earliest stage possible, so that the buyer can check that it accords with what was agreed with the seller at the time the offer to purchase the property was made. Conveyancers should note, and should advise their clients, that regardless of any other negotiations or agreements that may have been made, it is only what is contained in this form which is binding on the seller as regards what is to be left and what is to be removed.

Sometimes the seller will list certain items which are offered for sale to the buyer. If the buyer does not comment on whether he wishes to purchase the items then it cannot be assumed that he has agreed to do so. For clarity however the buyer's conveyancer should specifically advise the seller's conveyancer in writing, after of course taking his client's instructions, which items (if any) the buyer would like to purchase.

Any alterations made to the Fixtures, Fittings and Contents Form should be initialed by the seller. The form must be signed by all sellers. A copy should be attached to the contract on exchange.

Drafting the Transfer Deed

The Transfer Deed is the document which is presented to the land registry following completion of a property purchase to enable them to register the purchaser as the new owner, and it is the responsibility of the purchaser's conveyancer to draft it. Though in the past the transfer deed would have been drafted following exchange of contracts it is more common these days for it to be done at this stage. This because in the past there would be a gap of probably a month or more between exchange of contracts and completion, which is ample time for the purchaser's conveyancer to draft the deed, the seller's conveyancer to approve it and all parties to sign it so that the seller's conveyancer was holding a signed copy on completion. These days however it is rare to have much more than a week between exchange of contracts and completion and this is often not enough time, particularly if the first draft is not approved. Some seller's conveyancers will now even draft the transfer deed themselves and issue it with the contracts package. There is no real reason why the seller's conveyancer cannot prepare the transfer deed but some of the more traditional conveyancers may object.

Follow the link for a detailed explanation of the transfer deed together with a precedent form.

Raising Pre-Contract Enquiries

Having gone through the contract papers the purchaser's conveyancer will usually have a list of points on which he requires clarification or additional information, and perhaps a list of documents he requires copies of. He should therefore list these enquires in a letter to the seller's conveyancer. You may wish to view the chapter Example Pre-Contract Enquiries  for some examples of the more commonly raised pre-contract enquiries.

The following enquiry should always be raised unless it is already covered in the contract package :-

"Please advise whether any electrical works have been carried out to the property since 31st December 2004. If so, please provide a copy of the necessary Part P certificate"

This is because from 1st January 2005 the building regulations were amended so that many (though not all) items of electrical work had to be carried out by a Part P registered electrician. Part P registered electricians can self-certify their work and if they do so they must issue a certificate. If the electrician is not Part P registered then the work must be inspected by Building Control and a Completion Certificate issued. The Sellers Property Information Form has yet to be updated to incorporate this enquiry.

If the purchaser's conveyancer wishes to request amendments to the contract for sale, this is usually done by amending both copies (the seller's conveyancer will usually supply two copies of the contract for sale but if not it can simply be photocopied) in ink and returning one to the seller's conveyancer along with his other enquiries. This copy is sometimes referred to as the "travelling draft". 

Conveyancing Searches

What are "conveyancing searches"?

Conveyancing searches are a set of standard enquiries raised with a particular authority, for example a local authority search is raised with the local council, a drainage & water search with the water authority etc. It should be remembered that searches are intended only to cover the legal aspects of a property purchase - a conveyancer will not requisition a survey and will not report on the physical state of the property.

Who pays for the conveyancing searches?

The purchaser pays for the searches.

Won't searches be supplied with the Home Information Pack?

Yes, the Home Information Pack (HIPS ) will include the searches, though HIPs are only compulsory if the property was marketed after 14th December 2007.

What conveyancing searches do I need?

All purchasers should obtain a local authority search, certainly if purchasing with a mortgage you are obliged to the lender to do so. A drainage & water search is also advisable. Additional searches are required in certain areas, for example a coal mining search may be required in Yorkshire or a tin mining search in Devon or Cornwall.

Additional Information

There is much to consider with regard to searches and therefore the chapter Conveyancing Searches , which is dedicated to the topic, is strongly recommended.

The Mortgage Offer

When acting for a purchaser who is buying with a mortgage the conveyancer will, on the vast majority of occasions, also act for the lender. It should be noted that no commercial (as opposed to private) lender will allow the purchaser to carry out his own conveyancing. If the purchaser chooses not to appoint a solicitor then the lender will appoint their own and the purchaser will be expected to pay the fees.

The purchaser's conveyancer must check the offer to ensure that he is complying with the lenders' instructions and that details such as the purchase price, property address, borrower's names etc are correct. He must also satisfy any special conditions.

The mortgage offer will state how much the purchaser is borrowing, and how much the conveyancer will actually receive (though this is not always completely clear and care should be taken). This figure is obviously required to calculate the balance which will be required from the purchaser prior to completion.For a full tutorial on the subject of mortgage offers, visit the Mortgage Offers page.

Property Report to the Purchaser

Once the purchaser's conveyancer has received satisfactory conveyancing search results and satisfactory replies to his pre-contract enquiries, and if required a satisfactory mortgage offer, then he should be in a position to report to his client. This is sometimes done in person and sometimes through the post, however in either case a written property report should be prepared.

The property report should contain information on the title to the property, point out all the covenants and rights which affect it, it should include copies of any planning permissions affecting the property and should comment on the results of the conveyancing searches. It should point out anything adverse which has been revealed and which will not be resolved prior to or on completion and should also comment on the implications of taking a mortgage on the property, if applicable.

Purchasers should read this property report very carefully, and speak to their conveyancer about any issue that concerns them or that they do not understand. If an adverse matter is disclosed in this report and a purchaser having been presented with it instructs his conveyancer to proceed regardless then the conveyancer is entitled to assume that the purchaser understands the implications and is happy to proceed. It is unlikely therefore that the purchaser will have any claim against his conveyancer if in future the matter causes him loss.

If the property report is posted, the contract for sale, transfer deed and a power of attorney in relation to the SDLT1 (see the section on stamp duty) are normally enclosed, or if reporting in person these documents are normally signed in the interview. A completion/financial statement is normally given to the purchaser at this stage (see below).Look at this example property report if you wish.

Completion/Financial Statement

When reporting to the purchaser a financial statement should be produced, which breaks down the incomings and outgoings in respect of the purchase and includes a bottom line figure showing how much money is needed from the purchaser in order to complete. Producing the statement prior to exchange of contracts ensures that any errors with the figures or any queries the purchaser has can be resolved prior to exchange of contracts, at which point the purchaser is of course committed to proceed.

It gives the purchaser another opportunity to check the purchase price, if he is expected to pay extra money for any chattels it will be shown on the statement, or if he has agreed an allowance which his conveyancer was not aware of it should come to light if the purchaser checks the statement correctly etc.

It is a good idea to put the firm's bank details on the completion statement in case the purchaser wishes to pay the money by electronic transfer.It also makes sense to attach a sheet offering some standard advice on the various methods of payment, detailing clearance times etc, as well as pointing out that the purchaser should not attempt to pay cash, cheques or banker's drafts directly into your account (this is a common tactic of money launderers).

Exchange of Contracts

Once the purchaser has signed the contract, transfer deed, power of attorney (see stamp duty) and mortgage deed (strictly the last three do not need to be signed until after exchange, however the conveyancer must be in possession of them on completion), has paid the deposit (which must have cleared the conveyancer's account) and is happy with the property report, then the conveyancer is ready to exchange contracts. A completion date should now be agreed between the seller and buyer. This can be any weekday provided there is enough time between exchange of contracts and completion for mortgage funds to be requested, final searches to be completed etc.

Once a completion date is agreed contracts should be exchanged. For a tutorial see exchange of contracts

Pre-Completion

Requesting Mortgage Funds

Immediately following exchange of contracts the mortgage funds should be requested. Funds are requested by submitting the Certificate of Title to the lender. This document is found in the mortgage offer and is the document which confirms to the lender that the conveyancer is satisfied with the legal title. See the topic Mortgage Offer for more.

The certificate of title will ask for the date of completion, which is the date that the funds will be transferred to the conveyancer. It is advisable to request the mortgage funds for the working day prior to completion. This is because the lender will usually transfer the funds by CHAPS which means that they can only guarantee that the funds will arrive before close of business, not necessarily in time to actually complete. You should check with the lender first however - some will automatically release funds the day before.

Each lender will require a period of notice from receiving the certificate of title  to releasing funds which can be from 2 to 7 working days - you should ensure that enough time is allowed between exchange of contracts and completion to account for this notice period.It is definitely worth contacting the lender a day or two after submitting the certificate of title to check that they have received it and that there are no outstanding conditions.Obviously this section can be ignored if the buyer is not obtaining a mortgage.

Pre-Completion Searches

When acting in the purchase of a registered property it is necessary to carry out an OS1(when buying the whole of the title) or an OS2(when buying part of a title). If the purchaser is buying with a mortgage a bankruptcy search (K16)is also required.

The searches should normally be carried out as soon as possible, however it should be borne in mind that the bankruptcy search, which must be valid on the day of completion, is valid for 3 weeks from the date of the search and the OS1/OS2, which must be valid when the application for registration is submitted to land registry, is valid for 6 weeks.

Completion

On the day of completion the buyer's conveyancer will forward the funds required for completion to the seller's conveyancer by CHAPS (same day transfer). Provided that the funds arrive with seller's conveyancer by the completion time stated in the contract (which unless the contract contains a special condition varying that time will be 2pm) then the seller must vacate by the completion time. If the funds are not received by the seller's conveyancer by the completion time then the buyer is in breach of contract. Similarly if the funds are delivered on time but the seller has not vacated, then the seller is in breach. For a fuller discussion on completion, including what to do when things go wrong, Visit the Completion page.

Post Completion

Following completion the purchase must be registered. Briefly the process is that first the SDLT1 should be submitted to the Inland Revenue and an SDLT5 certificate obtained. Once this is done the application for registration is submitted to HM Land Registry. Once the application is completed any deeds/documents that are required by the mortgage lender are sent on to them and the remainder are sent to the purchaser. 

Stamp Duty Land Tax (SDLT)

Immediately following completion the SDLT1 must be submitted to the Inland Revenue together with any duty payable. If a correctly completed return together with duty is not submitted within 30 days of completion then the Inland Revenue will issue a penalty of £100. If the return is submitted incorrectly and is returned then no additional time will be given by the Inland Revenue therefore it is important that it is submitted correctly first time. For a tutorial on Stamp Duty Land Tax click on the link.

Registration

Following receipt of the deeds (in particular the transfer deed) from the seller (or his conveyancer) and the SDLT5 certificate from the Inland Revenue the application for registration should be submitted to H M Land Registry. The form to be used is form AP1 which should be submitted together with any necessary documents and the appropriate fee. For a tutorial on the subject of registration see Registration of a Transaction

Post-Registration

Once the registration process is completed the Title Information Document, together with any other documents required by the lender, should be sent to the lender, and the remaining documents should be sent to the purchaser, together with a copy of the title information document. The file can then be archived. According to CML rules the file must be retained for at least 6 years, after which it can be destroyed.

Regards

Free Conveyancing Advice

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