Conveyancing is the term applied to the legal process involving the transfer of a property from one owner to another. It applies to the buying and selling of both residential and commercial properties.
Conveyancing covers the entirety of the legal and administrative work required to ensure a property purchase is valid under law.
This process can be quite complicated and usually involves the input of a conveyancing solicitor for both the buyer and seller of the property. These professionals will act on behalf of the buyer or seller to ensure that everything that needs to be covered legally is dealt with as swiftly and efficiently as possible. The sale of the property could be subject to a variety of conditions, such as obtaining planning permission or certain works being carried out.
In this article, we will look explicitly at the conveyancing process involved with commercial properties and how it applies to both the buyer and seller.
Pre-Contract
For the buyer:
Initially, your solicitor will investigate the title deeds to the property and commission any pre-contract searches that may be required.
The seller’s solicitor should then send your solicitor the draft contract which they will review. Your solicitor should at this point raise any enquiries necessary resulting from their pre-contract searches.
They should also address the standard commercial property enquiry forms known as ‘CPSE Enquiries’. Any other matters, such as Stamp Duty Land Tax/ Land Transaction Tax, VAT, lease involvement, insurance and mortgage finance will also be addressed.
For the seller:
Your solicitor will investigate the legal title to your property and prepare the contract for sale.
They will then help you to complete one or more CPSE enquiry forms, depending on which type of transaction is relevant.
Further details of any other matters relating to the property may also be required such as details about any tenancies, rents, service charges and any equipment included.
The Contract
For the buyer:
Once you and your solicitor are satisfied with the replies to enquiries and search results then you will agree to/sign the draft contract. Your solicitor will then exchange contracts with the seller’s solicitor, and you will pay any agreed deposit.
For the seller:
Once the buyer has agreed the draft contract prepared by your solicitor, you will need to check and sign the document. On exchange, your solicitor may then take receipt of any deposit due on the property sale.
It is at this point that the transaction becomes legally binding for both parties.
Pre-Completion
For the buyer:
Your solicitor will undertake the appropriate pre-completion searches and prepare the Transfer Deed for approval by the seller’s solicitor. You will then be asked to provide the financial amount required in anticipation of completion of the sale which will include the purchase price and where applicable, the SDLT/LTT, VAT, apportionments of rent and service charges as well as the Land Registration fees.
For the seller:
Your solicitor will need to approve the Transfer Deed they received from the buyer’s solicitor and do what is required to prepare to discharge any mortgage to the property before you can complete the transaction. Your solicitor will also deal with any apportionments required in respect of any rent or service charges
Both parties will also propose and then agree on a suitable completion date.
Completion
The buyer’s solicitor will forward the amount agreed upon for the purchase to the seller’s solicitor, whereupon both parties’ solicitors will complete the transaction and the property will have switched ownership and key’s will be released to the buyer. The seller’s solicitor will discharge the mortgage and pay any agents. If appropriate, a rent authority will be provided so the buyer can make arrangements with any tenants for future rental payments
Post-completion
For the buyer:
Your solicitor will arrange for payment of any Stamp Duty Land Tax / Land Transaction Tax required and register the change of ownership and legal charge with Land Registry. The solicitor will also arrange for any notices to be served on a landlord so that the landlord will know where to send invoices for rent and service charges. If appropriate, the solicitor will register a legal charge with Companies House
For the seller:
Your solicitorwill redeem any charges on the property and the transfer of any remaining funds will be sent to you.
Here at Hutchinson Thomas, we have considerable experience in helping people buy and sell residential and commercial properties. We can usually offer free same day initial consultations, and can give advice either in person, by Teams/Zoom or by telephone.
If you wish to receive an immediate response to your enquiry, please telephone Peter Morgan on 01639 640154 or email at peter.morgan@hutchinsonthomas.com