Understanding how a Conveyancing transaction works – from start to finish!

When buying or selling property, the conveyancing process ensures that the transfer of property ownership from one party to another is legally binding and properly executed. This comprehensive process involves various legal, administrative, and financial steps. Here’s an overview of how a conveyancing transaction works, from initial offer to the day of completion.

1. The Initial Offer and Acceptance

The conveyancing process begins when a buyer makes an offer on a property, which, if accepted by the seller, forms the foundation for the legal process. At this stage, the agreement is not legally binding, and both parties can withdraw without facing legal repercussions. This pre-contract stage is important for both the buyer and seller to align their expectations and commence the formalities.

2. Instructing a Conveyancer or Solicitor

Both the buyer and seller typically instruct a conveyancer or solicitor to handle the legal aspects of the property transaction. The role of the conveyancer includes drafting and reviewing contracts, conducting searches, and facilitating the exchange of funds. It’s crucial to select a conveyancer who is experienced and accredited, as this ensures the process moves smoothly and meets all legal requirements.

3. Drafting Contracts and Initial Checks

The seller’s solicitor prepares a draft contract pack, which is sent to the buyer’s conveyancer. This contract pack contains essential details such as the sale price, property boundaries, and any conditions of sale as the basis of the contract together with the Law Society’s Property Information Form (TA6) and Fittings & Contents form (TA10). The buyer’s conveyancer reviews the contract and other documents provided and raises any preliminary inquiries to clarify issues related to the property. Common questions may address the property’s tenure (freehold or leasehold), potential disputes, and information on boundaries or easements.

4. Conducting Searches and Property Checks

To protect the buyer’s interest, several searches are conducted by the buyer’s conveyancer. These include:

These searches are vital to ensure that there are no hidden surprises that could impact the value or future enjoyment of the property.

5. Reviewing the Mortgage Offer

If the buyer requires a mortgage, their lender will conduct a valuation of the property. Once the valuation is complete and the lender is satisfied with the security of the loan, a formal mortgage offer is issued. The buyer’s conveyancer reviews this offer to confirm that the terms align with the buyer’s understanding. We would always recommend a survey be undertaken too.

6. Contract Exchange

Once all searches and checks are complete, both parties agree to the final terms, and the buyer’s deposit (typically 10% of the purchase price) is transferred to the seller’s solicitor. At the point of exchange, both parties sign the contract, and the agreement becomes legally binding. It is at this point that neither the buyer nor the seller can back out without significant financial penalties.

7. Completion Day

Completion is the day when the remaining funds are transferred from the buyer’s solicitor to the seller’s solicitor. Once payment is received, the seller hands over the keys (usually via the estate agents), and ownership is officially transferred to the buyer. The buyer’s conveyancer then registers the change of ownership with the Land Registry and pays any associated Land Transaction Tax (LTT - Wales) or Stamp Duty Land Tax (SDLT – England) on behalf of the buyer.

8. Post-Completion Activities

The final stage involves the conveyancer registering the buyer as the new owner with the Land Registry. This step formalizes the transfer of ownership. The buyer receives a copy of the updated title deeds confirming their ownership.

For further information please contact Gayle Edwards at Hains & Lewis, Solicitors on 0345 40 80 125 or email [email protected].