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Conveyancing Process: Selling and Buying in London

Conveyancing Process: Selling and Buying in London



Conveyancing Process: Selling and Buying in London

By Oliver Westmoreland, Immigration lawyer at Red Square London

  1. KYC and AML

Whether you decided to buy an apartment in London or a house insuburbs, you will need to engage licensed lawyers– property solicitors. At Red Square London, we have experienced English speaking as well as Russian-speaking property lawyers.

When instructions are first taken, your solicitor will need to comply with certain obligations, imposed on them by money laundering regulations. These obligations include checking your identity, and understanding the source of your wealth. London properties, for example, often are expensive. Your solicitor will ask you to offer supporting documents explaining how you have accumulated your wealth in the amount equal to the purchase price.

Our Russian-speaking property lawyers have extensive experience in dealing with the source of funds questions, especially with our Russian-speaking clients. In these transactions, it is important to exercise some degree of flexibility when requesting supporting documents to confirm the source of funds.

  1. Memorandum of Sale

This document is prepared by an estate agent and contains the main terms of the purchase/sale. These will include, amongst other, the address of the property (house in suburbs or an apartment in London) that you decided to buy, purchase price, full name of the seller, your name, the name of your legal representative and the seller’s property lawyers, terms relating to payment of holding deposit and deposit payable on exchange.

Your property solicitors will use memorandum of Saleas the basis for a contract between you and the seller.

  1. Investigating the Property

Your solicitors will undertake an investigation process. This process includes requesting a number of searches (local authority search, Land Registry search, Water and Utilities and Bankruptcy searches), receiving and analysing the results and discussing any risk areas with you. When buying in London(and, in fact, when buying any property anywhere in the UK)it is very important tohave clear understanding of the identity of the owner (seller) of the property, all matters relating to the title to the property, the costs of managing the property and, if it is an apartment in London, the costs of managing the building.

Once your solicitor completes investigations, they will advise you on the main aspects of the transaction, and will draw your attention to any risk areas that may exist. Our Russian-speaking property lawyers prepare a report on title, in both, English and Russian languages, containing all information you need to know in order to make a decision whether to proceed to exchange of contracts.

  1. Exchange of contracts

This is a stage when contracts, in agreed form, are signed, and its provisions become binding on both parties, you- the buyer, and the seller. The exchange of contracts is organised by your solicitors, who must be licenced lawyers in London. The contract is signed in counterparts, and both parts represent one single document. Red Square London property solicitors often sign contracts on behalf of our clients, relying on power of attorney.

At this stage, buyer usually pays deposit in the amount of 10% of the purchase price. All financial transactions (payment of deposits, balances, services charges, ground rent) are necessarily made between the solicitors and not the parties to the transaction. A completion date is agreed at this stage, and is included in the contract.

  1. Completion

This is the stage in the transaction when the balance of the purchase price is paid and keys to the property are released. Conveyancing in London is quite different from any other jurisdiction. Once the contracts are signed and completion date is agreed, neither of the parties can withdraw from the transaction without serious financial consequence. Completion must occur on the completion date, otherwise you (the buyer) will be liable to pay daily interest on the amount outstanding every day following the agreed date for completion and until completion has occurred.

  1. Post-completion

Following completion of the purchase your solicitors will calculate and pay Stamp Duty Land Tax. The rules relating to Stamp Duty Land Tax are quite complex, and the amount depends on various factors, including, the price of the property and how many residential properties you already own. Finally your name will be registered at the Land Registry as the new owner of the property.

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