While viewing properties, it is good to also start looking for a law firm to represent you in your purchase. As soon as you have an offer accepted on a property, the estate agent and the bank will need the contact details of your solicitor. The estate agent will need this for the Memo of Sale and the bank will need it to issue the mortgage offer as well as to instruct the same solicitors to act on their behalf as well. Some estate agents may be calling you every day after the offer has been accepted and may even allow more viewings of the property if you don’t have a solicitor.
Estate agents normally work with mortgage advisors and law firms on a referral basis so they recommend those to the buyers. It is most reasonable to research a few law firms and obtain quotes to compare their terms. We offer more detailed advice on how to choose your solicitors in chapter 5.8.11 of Part One of the book “How to buy your first home in England (and Wales)”. You can also use Appendix 9 of Part Three of the book “How to buy your first home in England (and Wales)” to facilitate your search for a lawyer.
Once you have your offer on a property accepted and have instructed a solicitor, the legal process will begin. This would now have a more defined timeframes although it again depends on your solicitor as well as the seller’s solicitor.
Conveyancing
The conveyancing service is available for anything between £500 and over £1,500 plus VAT from various law firms. The persons authorised to perform this service may have different qualifications – paralegal, legal assistant, conveyancer, chartered legal executive, solicitor.
Only a few hours are allocated to each file at an hourly rate of £150 – £300 (for a quoted fee of about £1,000 plus VAT). This explains the more complex communication with some colleagues, who cannot afford to spend 20 minutes on the phone every day with a client, especially if not all documents and searches are available to review at once.
There are law firms that function on a similar basis as call centres. They do not meet with their clients, do not offer direct contact and only contact clients by email when a document needs to be signed. If the client has a question, they cannot directly contact the solicitor working on their file. Due to the low prices these companies offer and the commission they pay agents, some property agents recommend them to buyers. However, it quickly becomes clear that progressing the purchase is very difficult as neither the buyer nor the seller’s solicitor has direct access to the solicitor who works for the buyer.
There are other firms specialising in conveyancing which offer their clients access to an online portal where they could track the progress of their deal and communicate with their lawyer. These portals are very user friendly and convenient however they limit the direct access to your conveyancer.
In large (and therefore more expensive) law firms, buyers (and seller’s solicitors) have direct access to the person dealing with the purchase via their direct telephone number and email address. These firms have well-established work processes designed in favour of the clients and guarantee the quality of the service. The quality is evident not only by the fees they charge but also by the professional attitude even of the reception staff. Most often, a whole team would work on a file and be aware of all details of the case, so if one of them is absent, the others are available to the client, and no delays occur.
Solicitors must send you a Letter of Engagement and Terms of Business. These documents detail what is included in their fees and what they are, what timeframes they are working towards, what other costs are expected, who else will be included in the team working on your file, who is your first point of contact and their secretary, how to complain and to whom, if you are not satisfied with their service, and so on.
It is best to ask what the fees include at the outset. Larger law firms, which seemingly charge more, actually include all possible aspects of their work in their package price. Smaller firms may quote you a lower fee but then charge additionally for things such as verifying your identity, if the property is leasehold, drafting the stamp duty land tax return and so on, which makes the final fees for their services the same or higher than that of the larger firms.
Law firms need to be transparent with their fees and processes and they need to inform you of the progress of your deal at regular intervals. They need to be accessible by phone and email. Their fees may increase during the course of the deal if any complications arise and more works is needed however they need to notify you of this as soon as possible and agree the fee increase with you.
The quality of the service is most accurately indicated by former and current clients’ recommendations, as well as by the main regulatory bodies and rankings, such as Lexcel, Legal 50 and the Conveyancing Quality Scheme (CQS). In fact only CQS accredited lawyers can offer conveyancing to clients.
It is also important to know exactly who will manage your file daily, whether you have direct contact with them, how often you will receive updates, and so on.
Finally, the most important item to know about the solicitors is whether they are in the panel of the bank which offered you a mortgage, because the same solicitors, in most cases, will also represent the bank, as well as the buyers. It is important to note that in these circumstances, solicitors are required to comply with their professional obligations to both the buyers and the bank, such as the obligation to maintain confidentiality, but also to disclose important information. This means that if there are material irregularities in the buyer’s documents, solicitors are obliged to keep this confidential, but they are also obliged to inform the bank. In these cases, solicitors will seek permission from buyers to notify the bank of the irregularity they have discovered in order to comply with their obligations to both parties. If the buyers disagree, the solicitor will cease working for both the bank and the buyers, regardless of the purchase stage. This most often happens at the beginning of the solicitors’ work if irregularities are revealed or not enough evidence is gathered in relation to the source of funds the buyers are using for the purchase.
Ownership of property by more than one person
When buying a property with another person (up to four together), you must decide whether you will own the property as Joint Tenants or as Tenants in Common. This is one of the important instructions you will need to provide to your solicitor. The main difference is that with Joint Tenants, everyone owns exactly half of the property, and if you are Tenants in Common, then everyone owns part of the property either equally or in unequal parts.
The main difference is the way the property can be inherited in case of death of one of you but there are also tax and practical implications, such as selling the property. You can read more about this in 5.6.6 of Part One of the book “How to buy your first home in England (and Wales)“
This must be your decision and must be kept under constant review if it needs to be changed.