Residential Conveyancing Explained
Conveyancing
is the word that defines the transfer of land or
property from one party to another. Property conveyancing in England & Wales is carried out
by conveyancing solicitors who are governed by
the Law Society or licensed conveyancers who are
governed by the Council for Licensed
Conveyancers. Both of these organisations are
there to protect the public and all conveyancing
advice solicitors and licensed conveyancers must have
in place indemnity insurance to protect their
clients. The conveyancing process can be complex
and stressful and it makes sense to use a
qualified conveyancer to take care of your
property transaction. If you have a mortgage on
the property all mortgage lenders will insist
that you use a qualified conveyancer who is on
their conveyancing panel. All of the
Wakefield conveyancers on the CMS Wakefield panel have been chosen
by us because they are either Law Society or CLC
registered and are on the panels of all major
mortgage lenders. For a more detailed
explanation of how the Conveyancing process
works check out our Residential Conveyancing Guide which you
will find in the menu on the left hand side.
How
to bet the best conveyancing advice and quotes with a Solicitor or Conveyancer
CMS have
been providing conveyancing services since 1995.
Our Directors have between them almost 60 years
of experience of working in the conveyancing
industry and we know what we are looking for in
a good conveyancing firm. We insist that our
conveyancing solicitors are registered with the
Law Society or the CLC. Every Conveyancing Firm
must have at least two partners and be on the
panel of all major mortgage lenders. Our
Liverpool conveyancing solicitors must specialise in
conveyancing. We insist that a dedicated and
named conveyancer is appointed to take care of
CMS clients and every conveyancer must be
qualified to carry out conveyancing services. We
look for conveyancing firms who present a good,
public image via their own web-site, who provide
up to date electronic case-management and
on-line tracking and updating. All of our
Conveyancers sign a legal agreement to abide by
the quotes we provide, not to charge "hidden
extras" and also to provide the level of service
published in our Service Charter - which you
will find in the left hand menu. In a nutshell a
good conveyancer will be qualified, experienced,
pro-active, IT literate, able to communicate
effectively and have a friendly and helpful
personality.
Requesting the
Title Deeds and a Redemption Statement
Write to the current mortgage lender and request that they forward to you both
the title deed and a redemption statement. This redemption statement is for
budgeting purposes only and is not final. Obtaining a statement at this stage
will allow you to check that the new mortgage advance is going to be enough to
actual complete the remortgage.
Lenders will often add a fee for producing a redemption statement and a deeds
production fee to the mortgage balance. When writing to the lender you'll need
to supply a mortgage account number, which you should ask your client to provide
when you seek his initial written instructions.
Obtaining Official Copies of the Client's Title
The next stage in the remortgage conveyancing process is to obtain copies of the
registers of title for the property ("Official Copies") which your client wishes
to remortgage from the Land Registry. At the time of writing the fee is £6.00.
Checking the Title
When acting in a remortgage it is not necessary to perform as in depth a title
check as you would if acting for a purchaser since you are only required to
check that the property is a good security for the mortgage loan. There are
certain matters that a lender is unlikely to be interested in such as changes to
the area that don't affect the value of the property and they will often not
require searches, but corner cutting should be kept to a minimum.
Checking the Official Copies
For registered land the official copies should give full details of the legal
title to the property.
Leasehold Properties
If the property is leasehold, it will be necessary to check the lease and to
raise certain enquiries with the landlord / managing agent to check such things
as whether the service charges and rent are paid up to date, who you need to
serve notice of charge on etc.
Searches
Most lenders will not require searches to be carried out for a remortgage,
though you will need to check part 2 of the CML Handbook for the particular
lender. Where searches are not required, it will be necessary to obtain "no
search indemnity insurance". For more information on indemnity insurance can be
found at
legal indemnity insurance.
For searches go to
conveyancing searches to see how they
are requested and interpreted.
Checking the Mortgage Offer
The lender will issue at least 2 copies of the mortgage, one to the borrower and
another to the conveyancer. The conveyancer's copy should incorporate the
lender's instructions to the conveyancer to act on its behalf in the remortgage.
It should also include the mortgage deeds and any other necessary legal
documents. The mortgage offer will state how much the purchaser is borrowing,
and how much the conveyancer will actually receive (though this is not always
completely clear and care should be taken).
Preparing for Completion
Once the official copies and if applicable lease and searches have been checked
and any problems or defects have been reported to the mortgage lender and they
have confirmed they are happy to proceed, you are ready to arrange completion
(subject of course to the borrower's instructions). In order to complete you
will need to do three things: request a final redemption statement, carry out
final searches, request the mortgage advance
Requesting a Final
Redemption Statement
On completion you need to repay the borrower's existing mortgage. Although you
should already have a provisional redemption you should still obtain a final one
calculated to the completion date, even if the one you have appears still to be
in date. Some lenders will not add all of the costs to a provisional figure and
also, the borrower may have made (or missed) a payment in the meantime. For more
on obtaining and interpreting redemption statements see
mortgage redemption statements.
Carrying Out Final Searches
Prior to completion, and prior to requesting the mortgage advance, you will
need to carry out a bankruptcy search against each borrower and also a priority
search (OS1). The bankruptcy search is necessary because a bankrupt's assets
actually vest in the trustee in bankruptcy so he is not entitled to borrow money
or to charge the property (or his share of the equity if he is a joint owner),
as well as the fact that obviously the lender would not want to lend to someone
in that financial situation.
The priority search will tell you whether any interests have been registered
against the title since you obtained official copies at the outset, and will
"freeze" the register to allow your application to register the charge to be
completed without the risk of another interest being registered after the date
of your search (provided your application is lodged in the 6 week priority
period).
Requesting the Mortgage Advance
When clear pre-completion searches have been received, or a least ordered, a
final redemption statement, you are in a position to request the mortgage
advance from the new mortgage lender.
Funds are requested by submitting the Certificate of Title to the lender. This
document is found in the mortgage offer and is the document which confirms to
the lender that the conveyancer is satisfied with the legal title. See the topic
Mortgage Offer for more.
The certificate of title will ask for the date of completion, which is the date
that the funds will be transferred to the conveyancer. The lender will usually
transfer the funds by CHAPS which means that they can only guarantee that the
funds will arrive before close of business, they cannot guarantee a time.
Completion of the Remortgage
Once you are in receipt of a final redemption statement, clear pre-completion
searches and the mortgage advance you are in a position to complete. You'll
obviously need to supply a completion statement to the borrower detailing the
remortgage advance, the redemption figure for the old mortgage and your costs
and disbursements. On the day of completion you'll also need to redeem the
existing mortgage. This should be done telegraphic transfer unless the lender
specifically requests otherwise. It is important that the funds arrive with the
lender on the day of completion as interest will usually accrue on a daily
basis. Unless the lender uses the EDS1, you'll need to send the lender a DS1.
Either way you should write to confirm redemption.
Registration
After completion the new mortgage will need to be registered. Provided the
transaction was remortgage only, with no transfer of equity, there is no need to
submit an SDLT1. Your AP1 should include the DS1 executed by the outgoing lender
(if not submitted electronically), the new mortgage deed and any certificates to
deal with any restrictions on the title.
Transfers of Equity
If, as part of the transaction, one or more people are being added to or removed
from the title, this is known as a transfer of equity. For guidance on dealing
with this type of transaction read
transfers of equity along with this
guide.
