Katie Brydon - Paralegal at Blackwood & Smith
What does your Solicitor actually do when you Purchase a Property?
So, you have been to view a property that you are interested in buying and the estate agent marketing the property tells you to instruct a solicitor – but why do you need one and what do they do?
Conveyancing is the legal process whereby ownership of a property is transferred from one party to another. The process involves separate lawyers acting for the purchaser and seller communicating with each other to impose their clients’ terms on the transaction and ensure the transfer goes smoothly.
Offering
Property purchases are one of the few remaining contracts still required to be in writing. Once you have chosen and instructed a solicitor, they will have an initial discussion regarding the property, your personal circumstances and funding. Your solicitor will look over the property listing and obtain a copy of the Home Report. They will then advise you of any potential conditions you may wish to make your offer subject to, such as you obtaining a mortgage, selling your current property or, instructing any additional reports (Damp Reports/Roof Reports etc.). They will also advise you of any essential conditions to put in place to satisfy the needs of your mortgage lender, as it is common practice for your solicitor to also act as a legal agent for your mortgage lender as well. Once they have taken your instructions your solicitor will submit an offer on your behalf.
Your Contract to Purchase a Property
Your solicitor will advise you on your contract to purchase the property; this contract is referred to as the missives. The first part of the contract is your offer which has been discussed above. Formal missive letters will follow this and will pass back and forth between your solicitor and the solicitor acting for the seller until both parties are satisfied. These formal missive letters are an opportunity for each party to accept or decline the conditions of the previous missive letter. Your solicitor will talk you through the missive letters, and will give advice on what they think of any specific terms or revisals and propose any changes they would suggest. When the terms of the missives have been fully agreed, they can be concluded, at which point there is a binding contract in place between you and the seller from which neither party can withdraw without facing penalty.
Obtaining Title to the Property
Title Deeds – Your solicitor will examine the Title Deeds for the property you intend to buy. They will send you a plan and description of the property to ensure that you are aware of the property boundaries. The title deeds will demonstrate the full extent of what you are purchasing together with any necessary rights of access to get to your property. They will also make you aware of any conditions placed on ownership of the property. Your solicitor will send these documents to you with their comments on the title.
Legal Searches - In addition to the titles, your solicitor will look through the required legal searches which search against the current owners of the property and the relevant public records affecting the property. These legal searches are in place to ensure that the current owners are in a position to sell the property to you. Searching the public records provides essential information relating to the property; your solicitor will be particularly interested to find out if the property is supplied with public water and drainage and to ensure there are no statutory notices affecting the property. Your solicitor will also look through the searches to check that there are no outstanding debts registered over the property.
The title deeds and legal searches for a property are a much deeper dive into what you are purchasing. This will be significantly more accurate and detailed than what is specified in the marketing provided by estate agents for the property.
Funding
If you require to borrow money from a bank to fund your purchase you should speak to a mortgage advisor or financial advisor as soon as possible. They will be able to provide advice regarding the affordability of a property in relation to your specific financial circumstances. Obtaining a mortgage takes some time so it is best to get this underway as soon as you can.
Your solicitor has Anti-Money Laundering requirements to adhere to. They have a legal duty to check that any money you are contributing towards the purchase is from a legitimate source.
In most cases your solicitor will also attend to the Security work on behalf of your mortgage lender. Your solicitor will draft a document, known as a Standard Security, which is granted by you as the purchaser in favour of your mortgage lender. This Standard Security is your confirmation that you will pay back the funds received on the terms set out in your mortgage offer (within the set term and with the agreed interest). The security is registered against your property to ensure that the lender holds a preferential right to the sale proceeds from the property. Your lender will require confirmation from your solicitor that the title that you will receive for the property will be good before they release the funds. The lender asks for the security and report as they want to ensure that the money they are lending for the purchase is as safe as possible.
Should you fail to comply with the lender’s terms and conditions your lender can call up their security and start the formal process of repossession to recover their investment in your property.
Property Taxes
Your solicitor is also responsible for submitting a property tax return on your behalf; this is called a Land and Buildings Transaction Tax return. This return is submitted to Revenue Scotland, it contains your details, the seller’s details, the transaction details and confirmation of the amount of tax due (if any). The amount of tax due will be based on the price of the property together with other factors (such as if this purchase is a second property for you).
Settlement and Registrations
Settlement - On the date of entry (the date you receive your keys) your solicitor will deal with settling your purchase of the property. Both your solicitor and the seller’s solicitor will only agree that the transaction has settled once they have confirmation from each other that the correct and full price has been paid; all required documentation has been exchanged; and your solicitor holds all necessary information and documents they require to register the title to the property in your name. Once the final checks have been made and settlement agreed your solicitor will let you know that you can collect your keys and take entry to the property.
Registration – There is still work to be done once the transaction has settled and you have your keys. Your solicitor will continue their work to complete the necessary registrations and ensure the title to the property is registered in your name. Once confirmation is received from the Registers of Scotland that your title has been registered your solicitor will be in touch with you to confirm this. They will send confirmation to your lender at the same time.
Contact Us
At Blackwood & Smith LLP. we can guide you through the whole conveyancing process in a way that is as simple and straight forward as possible whilst ensuring that you are fully aware of the details of the transaction. Our team would be delighted to assist you with your conveyancing transaction, please contact us on 01721 720131 or email us at This email address is being protected from spambots. You need JavaScript enabled to view it. to discuss.
