2): Pre-Contract Searches and Enquiries When acquiring Freehold and/or Leasehold Property Flashcards
Who carries out pre-contract searches and enquiries in conveyancing?
Principle of caveat emptor (buyer beware) applies
Buyer’s solicitor conducts searches on behalf of buyer and/or lender
Purpose: to investigate the property and title before exchange
What is the significance of pre-contract searches?
Helps the buyer decide whether to proceed with or withdraw from purchase
Confirms proof of title is established before exchange
Results may lead to further enquiries or negotiations
What happens after search results are received?
Confirm if results are satisfactory
❗ Clarify any issues with search provider or seller’s solicitor
🔍 Order more detailed/additional searches if needed
💬 Advise client on costs, risks, and timelines
What is the purpose of a survey or inspection of the property?
Physical inspection/site visit by surveyor
Reveals:
Property condition
Overriding interests or home rights
Form: Arrange site visit / instruct surveyor
What are ‘Enquiries of the Seller’?
Questions about the property the seller is expected to answer truthfully
Incorrect answers = risk of misrepresentation
Form: Standard Enquiry
Forms:
TA6 (Freehold), TA7 (Leasehold), TA10 (Fixtures)
Additional enquiries can be added
What does a Local Search include?
Info from Local Authority:
Local land charges
Planning permissions & refusals
Road schemes
Listed buildings / conservation areas
Smoke control / compulsory purchase
Forms:
LLC1
CON29 (standard)
CON290 (optional)
What does a Water and Drainage Search check?
Ensures property is connected to:
Mains water supply
Sewer system
Form: CON29DW
What is the Coal Authority search for?
Relevant in coal mining areas
Confirms:
Any historical or potential future mining activity
Form: CON29M
What are some additional ‘Other Searches’?
Chancel repair
Commons search
Flood risk
Contaminated land
Bankruptcy/Insolvency (against individuals/companies)
What searches apply to unregistered land?
Index Map Search (Form SIM):
Reveals cautions or pending registrations
Land Charges Search (Form K15):
Searches against current/previous owners
Reveals: easements, covenants, mortgages, estate contracts, home rights
What are the key searches for registered land?
HMLR Official Copies (Form OC1):
Reveals:
Proprietor
Property
Charges/encumbrances
Index Map Search (Form SIM):
Used if property spans multiple titles
Identifies mines/minerals under separate title
What is the Law Society Conveyancing Protocol?
Standardised framework for the sale/purchase of homes (not new builds) for owner-occupiers.
Regulates solicitor conduct (buyer/seller) to ensure fairness and client protection.
Mandatory for firms in the “TransAction – Conveyancing Quality Scheme”.
Firms on mortgage lenders’ panel must comply when buyer uses a residential mortgage.
What are typical sources of finance for a property transaction?
Main source: Mortgage finance (bank, building society, private loan, etc.)
Solicitor must:
Make client aware of extra costs: SDLT/LTT, HMLR fees, insurance, search fees.
Avoid providing specific mortgage advice unless authorised (Financial Services & Markets Act 2000).
Report suspicious large cash deposits under anti-money laundering duties.
What are the different types of mortgages?
Repayment
interest only
endowment
sharia compliant
What are the key features of a repayment mortgage?
Repayments: Monthly; part capital, part interest.
Interest: Fixed or lender’s standard variable.
End of Term: Entire loan is repaid.
What are the key features of interest-only mortgages?
Repayments: Monthly interest only (lower payments).
Interest: Fixed or variable.
End of Term: Capital still owed unless separately arranged.
What are the key features of endowment mortgages?
Repayments: Interest only; borrower buys insurance to cover capital.
End of Term: Insurance repays capital or does so on death of borrower.
What are the key features of sharia compliant mortgages?
Structure: No interest. Bank buys property → leases to buyer → transfers title at lease end.
End of Term: Title transferred to buyer by bank.
Why do the buyer and lender need good and marketable title?
Buyer: wants full, clear ownership.
Lender: needs secure asset for loan.
Defective title = risk on resale after default.
What are the risks of defective title?
Lowers property value.
Affects lender’s power to sell.
Threatens mortgage enforcement.
What does the lender request from the solicitor?
A Certificate of Title confirming title and completion details.
When can a solicitor act for both buyer and lender?
If:
Private residence mortgage.
financed by institutional lender.
UK Finance-approved Certificate used.
It’s reasonable and in client’s best interests. SRA Code of Conduct, para 6.2
What is a Report on Title and who prepares it?
Done by buyer’s solicitor.
Summarises title, contract & mortgage terms.
Why does the lender need a Certificate of Title?
Confirms property = good security.
Validates buyer’s title and completion date.
Ensures timely fund transfer.
What assurances does the Certificate of Title give the lender?
Good & marketable title.
Buyer is acquirer.
Date for funds/completion is confirmed.
What if the Certificate of Title is wrong?
Lender can sue buyer’s solicitor for breach of warranty.
What must buyer’s solicitor follow in residential cases?
UK Finance Mortgage Lenders’ Handbook.
When and how is the Certificate of Title delivered?
Just before completion & drawdown.
Signed and dated by buyer’s solicitor.
