Conveyancing Glossary
- Deed
- A term used very frequently in conveyancing transactions. A Deed is a formal legal document that clearly sets out the parties to the deed and is “executed” with a suitable attestation clause and signed in the presence of an independent witness who also signs and adds their name, address and occupation. Deeds for conveyancing purposes are usually drafted by specialist conveyancing solicitors. Deeds that apply in conveyancing transactions include conveyances, leases, deeds of covenant, deeds of release and surrender, deeds varying the terms of earlier deeds (deeds of variation) amongst many types of deed seen in conveyancing.
- Deed Of Covenant
- A Deed of Covenant is usually required in relation to the conveyancing of the purchase of a leasehold flat or freehold property with management company involvement. A Deed of Covenant is usually provided in a draft form to the purchaser’s conveyancing solicitors by the seller’s conveyancing solicitors in the course of a conveyancing transaction. The purchaser’s conveyancing solicitors will then produce the final deed to be executed by the conveyancing client to confirm they will comply with the terms of the existing lease or a former conveyance setting out covenants. Deeds of Covenant are often used in conveyancing to ensure a new purchaser agrees to pay any service charges that may be levied against a property for such things as paying for maintenance and repair of common areas. This is a common document in conveyancing transactions.
- Deed Of Gift
- A terms used in conveyancing to describe a conveyancing transaction subject to an element of gift, quite often seen when conveyancing clients are purchasing a property from a family member. A purchase conveyancing transaction involving a gifted element in money’s worth. Conveyancing solicitors acting on behalf of conveyancing clients that are being gifted a property or part of the value must report the gift to the mortgage lender when a mortgage lender is advancing money in order to aid the purchase in accordance with their conveyancing duties to the mortgage lender. Conveyancing solicitors acting on behalf of purchasing clients in these circumstances should also advise the purchasing client that the gift may affect the sale of the property if the property is sold within five years from the gift being made. Sales subject to a Deed of Gift within the past five years may well lead to a subsequent purchaser’s conveyancing solicitors insisting on indemnity insurance to protect the new purchasing client and mortgage lender against the previous Deed of Gift as in the case of an Undervalue Transaction.
- Defective Lease
- When dealing with leasehold conveyancing in a minority of instances a purchaser’s conveyancing solicitors may find a lease to be defective for lending purposes. This will be revealed in the course of the conveyancing work carried out by a buyer’s conveyancing solicitors and may be due to omissions of required covenants on drafting of the original lease by the original conveyancing solicitors such as lack of adequate rights of way granted for the owner of a flat over common parts of the building such as stairwells or the inclusion of covenants such as a covenant that the lease would be forfeited in the event of the bankruptcy of the owner. In such instances amongst others the lease may be deemed by the conveyancing solicitors to be defective. In these cases it may be necessary for the landlord to enter into a Deed of Variation varying the terms of the original lease. This is not a common occurrence in conveyancing and when found can leads to considerable delays in the conveyancing process as deeds to and fro for amendments by both sets of conveyancing solicitors. In the case of some defects revealed in the course of the conveyancing it may be possible for a legal indemnity policy to be purchased to provide cover against the defect which is often the most time and cost efficient method for both sets of conveyancing clients to bring the conveyancing matter to a successful conclusion.
- Defects In Title
- In conveyancing a defect in title is a problem with the title to a particular property or piece of land. Conveyancing solicitors acting on conveyancing transactions deal with defects in title that range from serious to minor and can include deeds that have been lost or destroyed and the contents of which can no longer be ascertained or alterations and extensions to a property and carried out to the property without the required permissions and consents. Conveyancing solicitors will carefully check the title to the property in a conveyancing transaction using the title deeds and documents plus information supplied by the seller’s conveyancing solicitors and the information revealed on the conveyancing search results to ascertain if the title to the property is clear. Many defects in title revealed in the conveyancing process can be protected against by conveyancing solicitors obtaining purchase of a suitable legal indemnity policy which can cover risks associated with a particular defect in title and enable the conveyancing matter to reach a successful conclusion.
- Deposit
- Used in almost every purchase conveyancing transaction this is the sum of money used to secure the conveyancing contract on formal exchange of contracts between the seller’s conveyancing solicitors and the buyer’s conveyancing solicitors. The standard conditions of sale for conveyancing contracts provide that a 10% deposit should be paid on formal exchange of contracts by the purchaser with the balance to make up the full sale price being paid over on the completion date. Often conveyancing clients will agree to exchange contracts on a lesser amount of deposit having discussed this with their conveyancing solicitors always with the condition that should the purchasing conveyancing client fail to pay the remainder of the purchase monies on the completion date the whole amount up to the 10% shall remain due. In the case of conveyancing chains the standard conditions allow for conveyancing solicitors to use deposits paid on the sale property to be used to fund the deposit for the related purchase and therefore when both buying and selling a property it is unlikely that a cash deposit on exchange of contracts will be required by the conveyancing solicitors in order to arrange exchange.
- Disbursement
- All conveyancing transactions attract disbursements. They are sums of money paid to a third party during the course of the conveyancing for a service or document required in the conveyancing process by the conveyancing solicitors. Disbursements include conveyancing search fees, land registry fees and stamp duty. A conveyancing disbursement is not part of the legal fees paid to your conveyancing solicitors for their professional conveyancing fees and should never attract VAT.
- Domestic Energy Assessor (DEA)
- A Domestic Energy Assessor is an inspector that is trained to government standards to visit a property and produce a report (known as an Energy Performance Certificate or EPC) for inclusion within the Home Information Pack. Once a buyer is found for the property the conveyancing process can begin and a copy of the HIP should be forwarded to the purchaser’s conveyancing solicitors by the estate agents or seller’s conveyancing solicitors. The purchaser’s conveyancing solicitors will pass in turn pass a copy the purchaser as part of the conveyancing process.
- Drainage Search
- A Drainage Search is a conveyancing search carried out with the sewerage and water provider. This conveyancing search is now usually provided by the selling conveyancing client within the Home Information Pack. The purchaser’s conveyancing solicitors when acting for a purchasing conveyancing client will check the search results to ascertain whether the property is connected for mains water supply and the sewerage system as part of the conveyancing process. The purchaser’s conveyancing solicitors will also check if any sewers cross the property or garden and check if any sewers have been built over. It may be necessary for the purchaser’s conveyancing solicitors to ask the seller’s conveyancing solicitors for evidence (usually a “Build Over Agreement”) that the sewerage undertaker has agreed to any building being erected over a sewer located within the property boundaries. In the event that the sewer has been built over without a “Build Over Agreement” it may be necessary for the conveyancing solicitors acting on behalf of the purchasing conveyancing client to insist a Sewer Indemnity Policy is placed on risk during the conveyancing process by the seller’s conveyancing solicitors. This is because the sewerage undertaker has statutory powers to enter upon a property in order to affect maintenance and repair to a sewer and in the absence of a Build Over Agreement is under no obligation to make good any damage caused in exercise of their power. For a purchasing conveyancing client this could mean that that an extension or conservatory or even the property itself could be damaged or demolished in the process resulting in loss of value. Where a mortgage is being obtained to fund the purchase conveyancing solicitors are also under an obligation to protect the mortgage lender’s security and may insist the selling conveyancing client via their conveyancing solicitor’s pay for the indemnity policy to be placed on risk to protect both the purchasing conveyancing client and the mortgage lender.
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