The difference between conveyancing for buying and selling
Conveyancing is a crucial process in any property transaction, whether you're buying or selling. As a conveyancing solicitor, I often encounter clients who are uncertain about what conveyancing involves and why it's necessary. This article aims to demystify the process, explaining the key differences between conveyancing for buying and selling property in the UK. By understanding these distinctions, you'll be better equipped to navigate your next property transaction smoothly and efficiently.
What Is Conveyancing?
Conveyancing is the legal transfer of property ownership from one person to another. It involves various legal and administrative tasks to ensure that the property is transferred correctly and that both parties' rights are protected. This process is essential to avoid future disputes and to ensure that all legal requirements are met.
Conveyancing for Buyers
When buying a property, the conveyancing process involves several key stages:
Instruction and Initial Steps
Once you decide to purchase a property, you'll need to instruct a conveyancing solicitor. They will:
Confirm their instructions and provide you with a client care letter outlining their fees and the process.
Conduct identity checks to comply with anti-money laundering regulations.
Obtain details of your mortgage (if applicable) and liaise with your lender.
Contract and Documentation
Your solicitor will receive the draft contract and supporting documents from the seller's solicitor. These typically include:
Property title information.
Property information form (TA6), which provides details about the property.
Fittings and contents form (TA10), indicating what is included in the sale.
Searches and Enquiries
Several searches are conducted to uncover potential issues with the property. Common searches include:
Local authority search: Reveals planning and building control issues, nearby road schemes, and other local matters.
Environmental search: Identifies risks such as flooding, land contamination, and subsidence.
Water and drainage search: Confirms whether the property is connected to public water supplies and sewers.
Your solicitor will also raise enquiries with the seller's solicitor to clarify any issues identified in the draft contract and searches.
Mortgage and Survey
If you're obtaining a mortgage, your lender will require a property valuation. Additionally, you may choose to commission a more detailed survey (e.g., a Home Buyer Report or a full structural survey) to assess the property's condition.
Exchange of Contracts
Once all searches and enquiries are satisfied, and your mortgage offer is in place, you'll agree on a completion date with the seller. Contracts are then exchanged, making the agreement legally binding. At this point, you'll need to pay a deposit, usually 10% of the purchase price.
Completion
On the agreed completion date, the remaining purchase funds are transferred to the seller's solicitor, and you receive the keys to the property. Your solicitor will:
Pay any Stamp Duty Land Tax (SDLT) due on your behalf.
Register the property in your name with the Land Registry.
Provide you with copies of the title deeds.
Conveyancing for Sellers
When selling a property, the conveyancing process involves the following stages:
Instruction and Initial Steps
After accepting an offer on your property, you'll instruct a conveyancing solicitor. They will:
Confirm their instructions and provide you with a client care letter.
Conduct identity checks as part of anti-money laundering regulations.
Contract and Documentation
Your solicitor will prepare the draft contract and gather the necessary documentation, including:
Title deeds: Proving your ownership of the property.
Property information form (TA6): Providing details about the property for the buyer.
Fittings and contents form (TA10): Indicating what is included in the sale.
Leasehold information (if applicable): Leasehold properties require additional documentation, such as the lease and management information.
Responding to Enquiries
The buyer's solicitor will conduct searches and raise enquiries based on the draft contract and supporting documents. Your solicitor will work with you to respond to these enquiries promptly, ensuring that any issues are resolved.
Exchange of Contracts
Once all enquiries are satisfied and the buyer's mortgage offer is in place, you'll agree on a completion date. Contracts are then exchanged, making the agreement legally binding. At this point, you'll typically receive a deposit from the buyer.
Completion
On the agreed completion date, you must vacate the property and hand over the keys. The buyer's solicitor will transfer the remaining funds to your solicitor, who will:
Redeem any existing mortgage on the property.
Deduct their fees and any estate agent fees from the sale proceeds.
Transfer the remaining funds to you.
Key Differences Between Buying and Selling Conveyancing
While the overall goal of conveyancing is the same—transferring property ownership—the processes for buyers and sellers differ in several key ways:
Focus of Searches and Enquiries
Buyers: The primary focus is on conducting searches and raising enquiries to uncover potential issues with the property. This helps ensure that the buyer is fully informed about what they are purchasing and that there are no hidden problems.
Sellers: The focus is on providing accurate and complete information about the property and responding to the buyer's enquiries. This helps facilitate a smooth transaction and avoids delays.
Financial Considerations
Buyers: Must arrange for the necessary funds, including a mortgage (if applicable), deposit, and additional costs such as SDLT and search fees. Buyers also need to consider survey costs.
Sellers: Must settle any existing mortgage on the property and pay fees to their solicitor and estate agent. Sellers typically receive the net sale proceeds after these costs are deducted.
Risk and Commitment
Buyers: Take on more risk and responsibility, particularly regarding the property's condition and any legal issues. The buyer's solicitor works to mitigate these risks by conducting thorough searches and enquiries.
Sellers: The main responsibility is to provide accurate information and ensure that the property is sold free of any legal or financial encumbrances. Once contracts are exchanged, sellers are committed to the transaction.
Documentation
Buyers: Must review and understand a variety of documents, including the draft contract, search results, and mortgage offer. The buyer's solicitor ensures that all documentation is in order before proceeding.
Sellers: Need to provide documents such as title deeds and property information forms. The seller's solicitor prepares the draft contract and assists in gathering and organising the necessary paperwork.
Why Conveyancing Is Necessary
Conveyancing is essential for several reasons:
Legal Protection
Ensures that the property transaction complies with all legal requirements, protecting both parties from future disputes.
Financial Security
Guarantees that funds are transferred correctly and that any existing mortgages or encumbrances are settled.
Informed Decisions
Provides buyers with the information needed to make informed decisions about the property, including any potential risks or issues.
Smooth Transactions
Facilitates a smooth and efficient transaction process, with clear timelines and responsibilities for both parties.
Let's recap!
Understanding the differences between conveyancing for buying and selling is crucial for anyone involved in a property transaction. Both processes involve distinct tasks and responsibilities, but the ultimate goal is the same: to ensure a legally sound and smooth transfer of property ownership.
As a conveyancing solicitor, my role is to guide you through this complex process, providing expert advice and ensuring that your interests are protected. Whether you're buying or selling, having a knowledgeable solicitor by your side can make all the difference, helping you navigate the conveyancing process with confidence and peace of mind.
