What is conveyancing?
Conveyancing is the term given to the legal work required to transfer the ownership of a property or property rights from one individual to another. There are two main stages in a transaction: exchange of contracts and completion.
How long is the transaction likely to take?
There are various factors affecting this including, but not only, the number of properties in the chain, how long search results and any mortgage offers that may be required take to come through, and how quickly information is passed on. Unfortunately the speed of a chain transaction (ie where someone is selling a property to buy another one) will be determined by the slowest link. For example, if one party’s mortgage offer takes a long time to be issued this will slow everyone down as contracts cannot be exchanged until everyone is ready to proceed.
A straightforward cash purchase (no related sale or mortgage is required) of a freehold property could be completed in two to three weeks but in a chain of transactions or where a mortgage is required the usual timescale is between six and 10 weeks depending on the number of parties involved.
If the property is leasehold then it takes longer due to the additional information required from the landlord or managing agents e.g. about service charge, ground rent and insurance.
What is the contract?
The contract is the legal document prepared by the seller’s solicitors that sets out the terms of the transaction, including the price, the names of the parties and insurance risk. It also covers what happens if something goes wrong (eg if the property is damaged or destroyed after contracts have been exchanged or if completion is delayed for any reason).
What do you mean by exchange of contracts and when will this happen?
Exchange of contracts is when the agreement to buy and sell becomes legally binding, a deposit is paid by the buyer and the completion date is fixed. Until this point either party can pull out of the transaction without having to pay the other for any financial loss they incur. Once contracts are exchanged, however, should anyone withdraw or be unable to complete on the completion date then financial penalties are incurred.
How is a completion date agreed?
A date for completion cannot be finally agreed until all parties in the chain are ready to exchange contracts. Suggested dates are agreed between the parties either directly or through solicitors or estate agents. It is usual to have at least seven to 10 days between exchange of contracts and completion allow time for arrangements such as booking removals and obtaining mortgage funds.
We advise you NOT to book time off work or firmly book a removal company until exchange of contracts has taken place.
What happens on the completion date?
The completion date is the day when the balance purchase price is paid to the seller’s solicitor and in return ownership is transferred from the seller to the buyer and the keys to the property are available to the buyer.
What is a Transfer Document?
This is the legal document which transfers the ownership of the property on a sale. It contains the details of what has been agreed between the buyer and seller and both parties will sign the document to confirm their agreement to the sale. This is the document which is sent to the Land Registry to prove ownership of the property has been transferred to the buyer.
