Summary
Summary ULAW LPC, Real Estate Chapter Readings
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- Real Estate (RE)
- Institution
- University Of Law (ULaw)
ULAW LPC, Real Estate Chapter Readings
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RE WS1 – Tasking Instructions TIFF LIAOChapter 2 – Outline of a Simple Transaction Page 9
SUMMARY
A typical conveyancing transaction is broken down into 3 stages:
(1) Pre-contract
(2) Post-contract
(3) Pre-completion
(4) Post-completion
Each stage consists of several key steps that a solicitor acting for the SELLER/BUYER/LENDER conduct.
In residential transaction the solicitor will often need to synchronise a sale and purchase so that one transaction does not take place
without another.
The Law Society Conveyancing Protocol standardises the residential conveyancing procedure for those firm that adopt it.
HOW A CONVEYANCING TRANSACTION WORKS
- Time:
(1) Pre-contract – longest stage & much of the legal work involved in the transaction is done at this time. Assuming that matters
proceed smoothly, this stage of a residential transaction may take up to 4-6 weeks from the date when the instruction was first
received.
(2) Post-contract – must shorter, no longer than 2 weeks.
(3) Pre-completion
(4) Post-completion – ‘tidying up loose ends’ process after the buyer has bought the property.
= unrealistic in most circumstances to expect the transaction to be accomplished in less than 6-8 weeks from start to finish.
= Sometimes due to delays caused by parties over whom the solicitor has no control (e.g. (eg, delays by a local authority in
returning a search application, or delays by a lender in processing a buyer’s mortgage application).
- In commercial transactions, the diff considerations apply + a much shorter timescale has often to be achieved to meet the needs of
their clients .
Procedure followed is basically the same.
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, RE WS1 – Tasking Instructions TIFF LIAO
Chapter 2 – Outline of a Simple Transaction Page 9
OUTLINE OF A SIMPLE TRANSACTION
Seller Buyer
EARLY STAGES
Marketing the property
The transaction will begin with the seller putting the property on
the market, in the hope of finding a buyer.
Before marketing can start:
- the seller/estate agent will need to have commissioned an
Energy Performance Certificate.
Once a buyer is found
- And price agreed, the conveyancing process can then begin.
- At the stage, the parties have NOT entered any legally binding
relationship with each other, and either can walk away from the
transaction at any point until exchange of contracts.
Energy Performance Certificate
Must have been commissioned (even though not received) BEFORE
the property can be marketed.
- Obligation to use all reasonable efforts to ensure that it is
received within 7 days of marketing.
- If NOT received, further 21 days.
- Once obtained, estate agent must provide a copy of the EPC
with the sale particulars and in the advertising.
- Responsibility of seller or landlord to ensure that a valid EPC free
of charge is given to the person who becomes the buyer or
tenant.
- Green Deal – EPC will disclose: Government initiation that
enables property owners and tenants to carry out range of energy
efficiency measures with no upfront cost.
Minimum energy efficiency standard: From April 2018
- Landlords of certain domestic or non-domestic buildings will NOT
be able to grant new tenancies or renew existing if the building
does not meet EPC rating E.
- A landlord who wishes to rent a sub-standard property will have
to undertake relevant improvements… UNLESS:
▪ obtained an opinion that improvement will have negative
impact on fabric/structure
▪ tenant’s consent has not been forthcoming.
▪ would result in reduction of more than 5% of price
PRE-CONTRACT STAGE Due diligence most time heavy aspect
Take instructions
- Obtain proof of the client’s identity due to money laundering regulations.
- Indirect instructions (e.g. from an estate agent on behalf of the client) must be confirmed directly by the client).
Prepare pre-contract package including investigation of title Receive the Pre-Contract Package & Investigate title
(a) The draft contract – showing what land the seller is selling Package may also include:
and on what terms they are prepared to sell it; Copy of local authority planning permissions – buyer’s
(b) Evidence of the sellers legal title to the property, to prove
solicitor would want to see to make sure the property which
that they own and are entitled to sell the land (identify issues
before sellers solicitors spots them). the client is buying is permitted to be built on the site.
(c) Sometimes, the results of pre-contract searches which the
seller has made. Buyer’s solicitor check documents carefully that:
the seller is entitled to sell what he is purporting to sell
Sends buyer’s solicitor evidence of title and draft contract The terms of the contract accord with their instructions AND
They do not reveal any problems which might make the
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