Page 17 - AvRillo_A4ConvGuideBook July2017

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LOCAL AUTHORITY SEARCH could lose out financially. The lender’s requirements may
be different from yours. They may be more stringent, which
This is a document which the buyer solicitor prepares and sends
to the seller’s local authority and which raises questions regarding means the conveyancer may have to take additional steps
the property. It covers such items such as whether the road serving that you may not have necessarily requested. When acting
the property should be maintained by the council (i.e. adopted by for the lender, the conveyancer risks being sued by them
them rather than the buyer having to contribute privately), whether for potentially hundreds of thousands of pounds. This is
there have been any planning applications on the property, and why many conveyancers prefer not to do your lender’s
a number of other things. The search is against the property only work but only yours. If you ask them however, they should
and does not cover the surrounding area. A word of warning – the help by carrying out this separate work (providing they are
search will not show any Planning Permissions or matters affecting on the lender approved panel - not all are). The lender will
land or buildings outside the boundaries of the property. You must ask you to pay for their lender work. These costs depend
therefore let your conveyancer know at the start of the transaction on the particular lender and can vary between £150 (way
if you require information on any particular point or if you wish us below average for the complexity and risk involved to the
to ask any particular additional questions of the local authority. conveyancer) to £700 (way above average). Too cheap and
the conveyancer may make mistakes. Ultimately, this may
MONEY LAUNDERING REGULATIONS result in your mortgage being withdrawn with the risk that

Part 7 of the Proceeds of Crime Act 2002 as supported by you may not be able to proceed and may even be sued by
the UK Money Laundering Regulations 2007 were introduced the seller. A happy medium on fees is about right.
by the Government to reduce fraud and the laundering of MORTGAGE REDEMPTION FIGURE
‘dirty’ illegally gained money by the use of buying and selling
property in the UK. This is stringently applied on all buyers Your buyer will not purchase unless you have paid off your
and sellers, which means it does make it more burdensome mortgage loan prior to completion. Don’t forget to provide
for innocent buyers and sellers but it is in the overall public your conveyancer with your mortgage account number and
good to reduce fraud, illegal activity and terrorism funding for the name and address of the lender at the very start of your
example, in the UK. The burden of identity of the individual case. This will allow them to contact your lender and start that
buyer and seller as well as tracing the source of money for work early.
the buyer are strict liability laws. This means you can be found
guilty of being in breach and liable to a term of improvement HOW it works? If you appoint a conveyancer to carry out this
of up to 3 years if you fail to follow its provisions. separate lender’s work they will request an initial redemption
It also means your conveyancer is prevented from acting statement on your behalf and also a final one just prior to
for you if you do not pass at the start of your case. Talk to completion. The lender will produce a redemption statement
your conveyancer at quote stage if you have complications. stating what they believe you owe. It will be that final figure that
These include obtaining a gift on your purchase as the person your conveyancer will be obliged to pay off. You therefore need
making the gift also has to proof ID and source of funds to check that figure early and dispute it at the start with your
under the UK anti-money laundering. lender, because your conveyancer will assume that subsequent
figures are correct.
MORTGAGE DEED

The legal charge of the property to the mortgage lender. If you WHO does this work? Normally you can appoint your own
are buying with the assistance of a mortgage, your solicitor conveyancer to do this separate lender work. If not, the
must send you this in time for you sign and return to avoid late Conveyancing Protocol requires you to pay off your mortgage
completion. in its entirety before your completion date. You then have to
wait to receive a formal discharge of your mortgage from your
MORTGAGE OFFER lender (called an END), which you must then produce to the
This is a loan taken out by you and charged against your buyer solicitors on the day of completion. As this is often difficult
purchase property to assist you in buying. You must check your for the seller to achieve, the Conveyancing Protocol allows
mortgage offer for the amount of the loan, its term of years, the seller’s conveyancer to give their own personal promise to
and all its conditions imposed upon you. You should only pay off your mortgage if you, the seller, fail to pay. This is very
accept if it meets your requirement. If not you must notify your burdensome and your conveyancer will charge. This cost should
lender immediately, possibly via your broker. You should only be set out in their terms; if not, ask them.
accept if you confirm it is accurate. Note. If you or your PROPERTY INFORMATION FORM
solicitor acting on your lender work, does not comply with the
This is a questionnaire about the seller’s property which the
terms of the mortgage (either within the offer or the Council of
sellers are duty bound to complete which your conveyancer
Mortgage Lenders’ Handbook) you risk losing your mortgage
will then send to the buyer’s solicitor. It covers such items
loan, either prior or after completion.
as guarantees, neighbour disputes and boundaries, planning
MORTGAGE WORK ON A PURCHASE - LENDER FEES permissions, occupation and other matters. Failure to disclose
information may give rise to the risk for the buyer to take
This is separate work carried out by your conveyancer for
your lender as they are, legally, a separate entity from you. legal action against you. To help speed up the transaction ask
Conveyancers are known for making errors here and you your solicitor to send you these out at an early stage in the
transaction.