Conveyancing – the legal transfer of property from one party to another – can sometimes seem like a daunting process. Here are answers to six of the most frequently asked questions.
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1. How long does the conveyancing process take?
The conveyancing process begins when an offer is made on a property. It is almost impossible to give an exact time scale, as the process can be affected by many different factors. The standard settlement period is around six to eight weeks once contracts have been exchanged, while the overall process is said to average around eight to 12 weeks. The Homeowners Alliance estimates the process usually takes around 12 weeks but warns the pandemic has led to delay.
2. What is meant by being ‘in a chain’?
A property chain is a line of buyers and sellers who are all linked together because they are buying and selling from each other. The chain starts with a person who is just buying and finishes with someone who is just selling. A long or complex chain can make the process lengthier and more difficult, especially if someone pulls out.
3. What is a leasehold property?
A leaseholder leases a property for a set number of years, but they do not own the land on which it is built. That is held instead by a freeholder. Most flats are sold as leaseholds. Typical leasehold terms are 99, 125 or 999 years.
4. What does ‘exchange of contracts’ actually mean?
Once the details of a sale are agreed, a contract is signed between a buyer and seller and becomes legally binding. The buyer pays a deposit during the contract exchange. This deposit is lost if they later pull out of the purchase. If a seller pulls out after this point, they could be sued. Conveyancers, such as Sam Conveyancing, will ensure reports and surveys are completed, legal documents are checked and mortgage offers are completed before contracts are exchanged.
5. What is indemnity insurance?
Indemnity insurance is a protection policy that can be taken out during housing transactions. It protects against potential problems that occur during a property purchase. It would cover against a third party making a claim against property defects in the property you want to purchase. But indemnity insurance does not cover the cost of having to repair or replace something.
6. When are conveyancing fees paid?
You will be asked to pay some initial money to cover search fees, which goes to third parties. Buyers may be asked to pay a deposit before exchange of contracts, with the rest of the conveyancing fee paid on completion. Check with your conveyancer before you begin the process.