26 September 2014 by

The five things you need to know about conveyancing

1.       THAT conveyancing is the legal term for the process of transferring the legal title of a property from one party to another.­ In England and Wales this is a two stage process:-

The First stage is from the acceptance of an offer until exchange of contracts.­ Before exchange of contracts takes place sellers and buyers are free to re-negotiate the price, sell to someone else or withdraw from the purchase and buy a different property or just decide not to sell or buy at all.­ Each party is responsible for paying their own survey, legal and other fees.­ This means that if one party decides to withdraw from the sale or purchase before exchange of contracts, the other will have no legal right to claim any of the costs incurred up to that point.

The second stage is from exchange of contracts until completion i.e. when you hand over/pick up your keys.­ Once contracts are exchanged, both seller and buyer are legally committed to the sale and/or purchase.­ The price and completion date is fixed by the contract and if either party fails to complete on the date agreed they will be in breach of contract and could face expensive legal action.

2.       THAT on exchange of contracts the buyer must pay a deposit (usually 10% of the purchase price). If the buyer fails to complete, the seller can in certain circumstances keep the deposit.­ If the seller has a related purchase, the deposit can be used towards the deposit on that purchase.  If a deposit of less than 10% is paid, the balance becomes due immediately if the buyer fails to complete on the agreed date.

3.       THAT under the current Standard Conditions of Sale, the buyer is responsible for insuring a property from exchange of contracts rather than from completion.­ If the property is damaged between exchange and completion, even though the seller is still living there, it will be the buyer’s insurance that covers it.­

4.       THAT properties are sold as seen.­ The expression “caveat emptor”, meaning “buyer beware”, applies to the state and condition of the property. It is up to the buyer to satisfy themselves as to the condition of the property before exchange of contracts.­ It is therefore very important that the buyer has their own survey and gets quotes for any work that is recommended.­ Although this may cost a few hundred pounds, an undiscovered structural problem could easily cost many thousands of pounds, so it is money well spent.

5.       THAT buyers should not rely on the lender’s “survey”, as it is not really a survey at all; it is a valuation. The lender’s survey merely confirms that the property will provide sufficient security for the loan that is being taken.  Furthermore, it is produced for the benefit of the lender and not the buyer.­ The surveyor is therefore only legally liable to the lender and not the buyer. Buyers should therefore obtain their own independent survey, whether that is a homebuyer or full structural survey.

Conveyancing is not a simple process.­ It involves a considerable amount of paperwork that requires careful consideration and detailed advice from your legal adviser.­ ­ Buying or selling a property is also one of the biggest financial commitments you will make in your lifetime, so it is unsurprising that without the right advice and guidance it can be very a challenging and stressful process.

Our specialist Residential Conveyancing team can help ensure your sale or purchase goes through smoothly with minimal stress or disruption, so if you are buying or selling a property contact Jack Lambdon on 020 7288 4773 or by email at jacklambdon@boltburdon.co.uk or any of the team.

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