The Legal Procedure
Whether you are buying or selling your first home or moving for the umpteenth time, it makes sense to instruct a firm of reputable solicitors as soon as you have decided to move, giving you a clear idea of all costs involved. This will also enable them to take preliminary steps on your behalf (such as obtaining your title deeds from your current mortgage lender), thereby enabling the transaction to proceed immediately once a purchaser and/or property has been found for you to purchase.
The average time between agreeing a sale on your property and having a binding contract (exchange of contracts) is approximately 6 to 8 weeks, although it is possible to achieve an exchange of contracts much quicker if everybody involved is organised and able to act quickly. Remember that a 'chain' is only as quick as the slowest person! The actual transfer of ownership (completion) usually takes place between 7 to 14 days (after exchange of contracts) although again this period will vary according to all involved parties.
In extreme cases a simultaneous exchange and completion or a delayed completion date can be agreed between all parties and if this is likely to be the case then this subject should be broached as early as possible as it normally involves one party being potentially disadvantaged.
Once a sale has been agreed both the seller and purchaser need to formally instruct their solicitors to act on their behalf and return all relevant paper work, identification and fees that are requested (the vendor will need to complete the fixtures and fittings and property information forms).
Once the solicitors have been instructed the seller's solicitor will prepare a draft contract for submission and approval by the buyer's solicitor. To enable the solicitor to do this, they will need the title deeds to the property, which are usually held by your mortgage lender.
The buyer's solicitor will then submit his searches and enquiries and on the successful agreement of these and all of the client's necessary finance arrangements have been put in place, the contract will be approved.
Please be advised that there are several enquiries that are now becoming a pre requisite with most solicitors, these include gas and electrical installation certificates, fensa certificates for replacement windows, planning permission and building regulations for both extensions, alterations and dropped kerbs and additional parking, therefore please bear these in mind if you think it may affect your property.
One copy of the contract is signed and kept by the buyer and the other is sent back to the seller's solicitor for signature. At this point, a completion date will be agreed with all parties involved. Contracts will exchange when everybody is ready to commit legally and financially to the transaction and it is at this point that the sale becomes legally binding. (Legally binding means the contract is registered in law and if a party then defaults on the agreement, penalties are payable).
Upon receipt of a draft contract from the seller's solicitors, the buyer's solicitors will submit enquiries to the seller's solicitors and also send a search requisition to the local authority, which takes an average of 7 - 14 working days to be completed.
The buyers solicitors will require their copy of the buyers mortgage offer, local searches and replies to enquiries before requesting that the buyer signs the contracts, provides cleared funds for deposit and agrees a completion date. At this point and assuming all other parties in the chain are ready to exchange contracts the buyers solicitors will release the contract for a legally binding exchange of contracts with the vendors solicitors and so on throughout the chain.
On completion, your mortgage lender will then forward the mortgage monies to your solicitor thereby enabling your solicitor to pay your sellers solicitor for your home. The completion of the transaction is of course also subject to the receipt of any balance of funds from you. If you are selling a property, then your existing mortgage will also be paid off at this stage.
Your solicitor will also deal with formalities such as payment of stamp duty (if applicable) and registration of the transfer of the property in your name at H.M. Land Registry
Stamp duty is payable to the Inland Revenue on the purchase of any property with a purchase price in excess of £125,000.