Whether you are buying or selling a house, conveyancing is involved. Whilst most people understand the fundamentals of marketing a house for sale or of finding a property to buy, even the word ‘conveyancing’ is hardly an example of Plain English and it’s easy for property buyers and sellers in Scotland to feel that conveyancing is a bit of a mystery to them. So here is a simple guide to what conveyancing is, how long it takes, what is involved and various other frequently asked questions that property sellers and buyers in Scotland have about the conveyancing process.
What is Conveyancing?
Conveyancing is the legal process that takes place after you have agreed the main details of buying or selling your house. It involves creating a contract that leads to ownership being transferred from one person to another. This is done by way of missives, which are essentially the exchange of letters between the buyer and seller’s solicitors.
In theory, missives could be concluded in two letters if the seller agrees to all the terms of the buyer’s written offer. However, in practice this is very unusual and the buyer’s offer is most often subject to a survey being carried out which prevents a straightforward acceptance by the seller of the original offer.
Conveyancing also involves carrying out additional searches that concern the property itself and the parties involved. Searches and checks are carried out to find out whether there are any outstanding communal repairs, whether the fabric of the building complies with local regulations and whether any alterations have been accompanied by the necessary permissions and paperwork. These conveyancing steps ensure that the buyer gets what they think they are purchasing and avoid a situation where the buyer is landed with significant costs after they have bought the property.
What Are the Different Stages of the Conveyancing Process?
Between the offer being accepted and the transfer of ownership, there are steps that have to be taken.
Once the offer is accepted, the buyer and seller’s solicitors must negotiate the terms of the contract by way of exchange of ‘missives’. This will include agreeing issues such as the Date of Entry (when the buyer pays the money and the seller hands over the keys) and any additional items that are to be left in the property. The seller’s solicitor must send the buyer’s solicitor the title deeds to the property as well as a search of the Land Register to show that there is nothing that will legally prevent the seller from selling the property.
The conclusion of the contract of sale and purchase is called ‘conclusion of missives’.
The buyer’s solicitor will ask their client to send the required purchase funds to the solicitor’s client-specific bank account. The buyer’s solicitor will also request any mortgage funds from the mortgage lender, where appropriate.
On the Date of Entry, the buyer’s solicitor pays the purchase price to the seller’s solicitor. The seller in turn provides the buyer’s solicitor with essential paperwork that facilitates the transfer of ownership of the property to the buyer.
All being well, when the buyer’s solicitor confirms that they are happy with the paperwork that they have been provided and the seller’s solicitor confirms that they are happy that they have received the purchase price on behalf of the buyer, the transaction is treated as ‘settled’. The buyer often picks-up keys from the seller or from the seller’s solicitor or estate agent and can begin the process of unpacking their boxes at their new home!
After that, further works is done by the seller and the buyer’s solicitors. The buyer’s solicitor, in particular, needs to inform Land Registers that their client now owns the property and to pay any Land & Buildings Transaction Tax that the buyer is liable to pay to the government.
How Long Does the Conveyancing Process Take?
There is, unfortunately, no set timescale for the conclusion of missives. The length of time it will take depends on the simplicity of the situation. Issues that can hold up the conclusion of missives generally concern:
- the number of issues that the buyer and seller are in disagreement about
- the buyer’s lender delaying sending through the mortgage paperwork
- issues coming out of the woodwork that even the seller was unaware of
Examples of factors that affect how long the conveyancing process takes include:
The seller not owning as much as they think they do
What are the most common causes of delays in the conveyancing process? A good example is the seller believing that they own more than they actually do: for example, they believe that the extent of the garden or land is more than it actually is. Also, on occasion, it may transpire that the seller is not, in fact, in a position to sell, for example if the property is subject to legal proceedings.
The buyer getting their mortgage confirmed
It is only after a purchase or sale has been agreed that the buyer’s mortgage lender makes the formal offer of the loan to the buyer. Prior to agreement of a purchase or sale, the buyer will only have an agreement in principle from their mortgage lender. Sometimes buyers in fact won’t have much more than confirmation, via a mortgage comparison website, of whether they can, in theory, get a mortgage (subject to all sorts of other factors being confirmed at a later date). With different lenders having different rules and procedures and also vastly different mortgage processing times and eligibility criteria, the buyer’s mortgage position is often the most significant factor that affects the duration of the conveyancing process and and most buyers’ solicitors will not conclude missives until they have a formal mortgage offer in their hands.
Where alterations have been carried out in the property without the necessary permissions or contrary to local regulations, additional paperwork is required in order for the transaction to settle.
Statutory Notices are notices of common repairs requiring to be done. They are particularly common in Edinburgh and were issued by Edinburgh Council. Where the Council has instructed that communal repairs have to be carried-out, this can lead to significant additional legal work which can delay the conclusion of missives. In some cases, the seller may have been completely unaware that the work had been instructed. Many of these notices are now quite old due to the suspension of the department handling the Statutory Notice scheme in Edinburgh but they still exist and, where this applies, significant negotiation is often required to satisfy the buyer and the seller that they are adequately covered in the event of the notice ever being enforced in the event that the Council department handling these notices is ever reinstated.
Anti-Money Laundering Checks
Additional anti-money laundering checks may need to be carried out during the conveyancing process. This can occur where the money for the sale is from a third party, such as a gift from a relative (in which case said relative would need to undergo AML checks), where the conveyancing process reveals that someone else is named on the title deeds, or where other circumstances dictate it. To the extent that the Law Society has pulled-up a firm of solicitors for not obtaining I.D. from the wife of one of the partners where she was buying a property, the rules are pretty strictly enforced and, albeit it can cause some inconvenience, it’s a necessary part of the process.
The conveyancing process can often be much slower than the initial marketing and agreement of sale on the property. Buyers and sellers may feel that, during this process, they receive less contact from their solicitor or agent than they did during the previous stage of the sale or purchase. With missives often still being negotiated by exchange of physical letters, lenders often taking several weeks to issue mortgage papers or to provide the seller with their Title Deeds and with the local Council often employing a standard 10 day response time for any queries put their way, buyers and sellers often feel that this stage is taking longer than it needs to. However, even though it may seem that not much is happening at times, the solicitors are often working in the background to ensure the completion of your sale or purchase goes smoothly.
Hopefully this simple guide helps to demystify that process a little bit and to explain what is happening during this otherwise slightly mysterious process!