Overview of the conveyancing process Flashcards
True or false;
Once a buyer has been found and the price agreed upon, the first step of the conveyancing process is complete and a legally binding relationship is formed
False
The conveyancing process begins after the price is agreed.
A legally binding relationship has not been established yet
What are the 7 steps of the conveyancing process?
- Marketing the property
- Taking instructions
- Pre-Contract stage
- Exchange of contracts
- Pre-completion steps
- Completion
- Post-completion admin
What occurs during step 1 of the conveyancing process?
Marketing the property - the seller looks for a buyer, finds a buyer and agrees on a price
What occurs during step 2 of the conveyancing process?
Taking instructions - the solicitor takes the clients instructions and verifies the client’s identity (this MUST be mentioned in answer, very important process) to comply with anti-money laundering regulations
What are the 2 steps needed to complete the pre-contract stage of the conveyancing process?
- The buyer and seller’s solicitor investigate title
- They buyer’s solicitor conducts searches
How is title, in regard to registered land, investigated?
By reviewing documents from the Land Registry.
In a property transaction, what is actually being sold?
The title to the land
When investigating title, which documents are primarily examined?
Register of Title and Title Plan
Why is it important that a buyer’s solicitor investigates title?
- So that the seller is able to transfer what they are contracting (because the contract hasn’t been made yet) to sell
- To identify any problems with the land that could ADVERSELY AFFECT THE INTERESTS OF THE BUYER, of which if there are any, the client must be advised on
What maxim applies to conveyancing and what does it mean?
Caveat Emptor - “let the buyer beware”
This means that the responsibility is with the buyer to discover all of the info that they need to decide on the purchase.
What happens if a buyer discovers that there are issues with the property after completion?
Nothing. Following the maxim caveat emptor, if the buyer could have discovered these issues before completion, even if the seller knew of them and said nothing, then the buyer will not be able to do anything about it.
Is the seller subject to any obligations?
Only 1 - to honestly disclose information that they are asked for by the buyer.
Why does the seller’s solicitor investigate the property?
In order to accurately reflect the property that the seller is selling in the contract of sale, as the seller’s solicitor is the one that prepares this contract
What is a certificate of title?
A report on the property made by a solicitor to give to the buyer’s lender (e.g. the bank) so that they do not need to conduct their own investigation
Once the investigation of title has concluded, what happens next?
The solicitor, and potentially the buyer themself, will conduct searches in order to discover as much info as possible and subsequently protect the buyer
What occurs during step 4 of the conveyancing process?
The exchange of contracts, in which the parties sign identical contracts.
When does a binding contract arise in the conveyancing process?
Once the buyer and seller exchange signed identical contracts.
What occurs during step 5 of the conveyancing process? (HINT: there are 7 steps)
Drafting the Transfer Deed
Sending a Request for Completion Information to the seller
Engrossing and Executing the Transfer Deed
Making Pre-Completion searches
Ensuring the buyer’s solicitor is in funds
Preparing any undertakings necessary on completion
Addressing various practical issues
What occurs during step 6 of the conveyancing process?
Completion
What is completion?
It is when the legal title passes to the buyer
When does completion occur in unregistered and registered land?
For unregistered land - when the title passes to the buyer
For registered land - Once the buyer is registered at HM Land Registry, upon which the title will pass to the buyer
What occurs in step 7 of the conveyancing process?
The post-completion Admin
What must the seller’s solicitor do during the post-completion admin stage?
Discharge the seller’s mortgage on receipt of completion monies
Send any remaining proceeds of sale to their client
Send the bill to the client
What must the buyer’s solicitor do during the post-completion admin stage?
Pay Stamp Duty Land Tax
Complete the Mortgage Deed
Account for any bridging finance
Register the buyer as the legal owner with the Land registry
Once registered, check the Register
Entries by confirming that the Title
Information Document received from the Land Registry is correct
Register the Mortgage at Companies
House
Send the bill to the client
