Hover mouse over headings on the left to read further information.

Advance cheque
The mortgage advance money sent by any Lender (Bank/Building Society etc) to the Buyer's solicitor. Nowadays this payment is usually sent to the Buyer's solicitor using Bank Telegraphic Transfer (sometimes called 'TT')

H M Land Registry
All transactions involving land have to be registered at H M Land Registry - rather like registering the transfer of ownership of cars at Swansea.

The next part is boring. Read on only if you want to.

Each property (Title) is given a specific reference number - the Title Number. It contains a complete description of the property, including a plan, and gives details of any mortgage or any other matter that can affect the property. All this information is contained in a Register. The Owner is given a certificate of ownership called a 'Land Certificate' If the property is subject to a mortgage then the Mortgagee (the Lender - Bank or Building Society) are given the certificate of ownership (for security) - then called a 'Charge Certificate'.

Chain (of transactions)
A is a first time Buyer who is buying from B.
B is buying a house from C.
C is buying a house from D etc - all the way down to X.
X is buying a house from the late Y, who unfortunately died.
AND THIS COMPLETES AN EXAMPLE CHAIN

If any one in the chain pulls out, the whole chain may fail. Typically everyone will exchange contracts on the same day - to complete and move on the same day. THAT day (often a Friday) can be very busy indeed!

Index Map search
See also H M Land Registry

Nearly all properties in the Country are registered at H M Land Registry - with individual 'Title Numbers'. It is possible to find out what the Title Number is for a property by carry out an Index Map search. This can sometimes help a Seller's solicitor speed up the preparation of the Contract.

Completion
The date, or day:

• the full purchase monies are paid over to the Seller
• any Mortgage starts
• ownership is transferred to the Buyer
• the Buyer gets the keys to the property
• the Buyer can move in!

Joint Ownership (also see top)
If you buy a property with somebody else then the question of joint ownership arises. The owning interests will be held either as Joint Tenants or as Tenants in Common. This is an important issue.

See separate help on this subject.

Contract
Any Contract for the purchase/sale of property should:

• be in writing
• set out the names and identities of the Buyer and Seller
• clearly describe (identify) the property
• contain the price
• specify the Completion Date
• set out any other agreed terms
• usually contain a provision for payment of a deposit, usually 10% of the total price

The Contract is prepared by the Seller's solicitor with two identical copies. The Seller has one and the other is sent to the Buyer. When both are ready, and a Completion Date is agreed, they finalise the deal by 'Exchanging' their own signed copies.

Mortgage Offer / Instructions
If a Buyer is having taking a mortgage to help buy a house, the Lender (Bank/Building Society) will - if it approves the loan - send out a Mortgage Offer to the Buyer. It sets out the Lenders conditions of loan. If the Buyer accepts the offer, the Lender then will send out Mortgage Instructions to the solicitor appointed by the Buyer. If the Buyer relies on the loan to buy a property then Contracts cannot be exchanged until the Mortgage Instructions have been received by the Solicitor. It is the guarantee that the loan will be made.

The Mortgage Instructions also instruct the solicitor to carry out it's requirements - and the solicitor must do so.

Conveyance
The exchange of contracts concludes the agreement to Buy/Sell the property.

The Conveyance/Transfer is a legal document which actually transfers the ownership (or Title) of the property from the Seller to the Buyer.

The term 'Conveyance' refers to the 'older' description of this document before the introduction of compulsory land registration. Nowadays all transactions involving land have to be registered at the central HM Land Registry. In nearly all cases the transfer of actual ownership is done using a form required by the Land Registry - called the 'Transfer'.

Occupier Consent Form
This is usually a requirement of a lender.
The Lender (Bank or Building Society) will require any adult living at the property [it is taking a mortgage on] to sign a form of consent confirming:

• They are aware of the new mortgage being taken on the house
• They acknowledge that the Lenders mortgage will take priority to any interest they may have in the house and agree to it
• They have been advised on their rights before signing the 'consent'

'Any adult' will mean, for eg, any adult children or family or tenants etc - OTHER THAN THE OWNERS SIGNING FOR THE MORTGAGE The reason is quite simple. If the Lender has to take repossession proceedings at any time - it is to prevent an occupier suddenly saying something like - I did not sign for the mortgage and I claim to own a share in the property - you can't repossess the property while I live here. If the occupier signed the occupier consent form then the Lender could take repossession whether the occupier claimed to own a share or not.

Covenants
Last week 'A' bought a house from a Builder who insisted on 'A' promising and agreeing (covenanting) that he -

wouldn't - keep pigeons at the house, park caravans at the front of the house, carry on any business from the house, build any extensions to the property (without the Builder's approval) or generally be a nuisance.

These are examples of typical 'restrictive' covenants.

Covenants can also be 'positive' in nature

Instead of saying that he wouldn't do something - a positive covenant may say that 'A' will put up a fence at the back, and will pay towards the maintenance of drains etc These covenants may be made to bind a future Buyer 100 years on. A future Buyer may still be required to carry out and observe those same promises given by 'A'. Covenants are registered against the Title of properties and the Buyer's solicitor will check these out and let the Buyer know if there is anything he/she should know about.

Pre Contract Enquiries
This is an extremely important part of the buying process.

As well as checking that the Seller is entitled to sell the property (has good Title) the Buyer thinks he is buying - the Buyer's solicitor will try and find out as much as possible about the property. The Seller should give a lot of information in a 'Property Information Form' - but the Buyer will want to check this and this is his/her chance to ask any other questions. Typically the Buyer will want to know:

• have their been any neighbour disputes?
• if the Deeds don't show it (and sometimes they don't) who owns the boundaries or usually maintains them?
• has any building work been carried out which should have Planning Permission (and doesn't!)
• does the property have any damp proof course, double glazing etc - and any guarantees
• etc etc

A questionnaire will also be sent to find out what fixtures and fittings are, or are not, included in the sale/purchase. At this time the Seller's solicitor will also carry out 'Searches' (ask questions about the property) with, typically, the Local Authority, Coal Board, Water Board etc.

The purpose of all this is to make sure the Buyer knows as much as possible about what he/she is buying - including any problems which might seriously affect the property's future value.

Deposit
Usually 10% of the total purchase price and paid to the Seller when Contracts are exchanged. The Seller will occasionally accept less if there is a good enough reason.

If there is a chain of transactions then it is quite normal for the deposit paid by the first in the chain to 'pass' down the chain and end up paid to the 'end Seller'.

Prepare / Draft Contract
It is the responsibility of the Seller's solicitor to prepare the written Contract. That solicitor will write to the Bank/Building Society (if there is a Mortgage) to 'borrow' the Deeds so that the solicitor can make sure the Contract includes a proper description and contains everything that it needs to. The Contract prepared (drafted) by the Seller's solicitor is then sent to the Buyer's solicitor to check over and, importantly, to check against the Title of the property. The Buyer's solicitor will want to make sure the Buyer is getting everything he thinks he is getting and that there are no nasty surprises. If the Buyer's solicitor is satisfied then the Contract is said to have been 'approved'.

Disbursements
These are payments which are made by the solicitor, on the client's behalf, for things like:

• Any Stamp Duty
• Search Fees
• Land Registry Fees
  They are usually shown in the solicitor's Bill but do not form part of the solicitor's actual costs.

The Autoquote feature sets out the likely disbursements (which can vary according to location, price of the property, and requirements of any Lender [Bank/Building Society]) which may be expected to be paid out on top of the quoted costs. Please click (in the autoquote page) on any of the disbursements mentioned for a further explanation of them individually.

Property Information Form
See also Pre Contract enquiries.

This is a basic information form which the Seller completes setting out what he/she knows about the property. Misleading, or false, information could entitle the Seller to sue for damages (and in extreme cases to overturn the sale) if the Buyer might not have gone ahead with the purchase had he/she known the truth!

It needs to be completed truthfully and accurately.

Equity
This is an expression which has a particular meaning in law but it is also used quite often to express the true 'value' of property - that is the 'market value' (or actual sale price) less the amount of any mortgage secured on the property.

Eg A house worth £100,000 but subject to a mortgage of £40,000 has an 'equity' of £60,000.

Searches
These include:

• Local Search
• Official Search
• Bankruptcy Search
• Brine Board/ Coal Board Search
• Enviromental Search
• Land Charges Search
• Index Map Search and Commons Search

See 'Disbursements' and also our Autoquote feature - which give explanations by clicking on the different disbursements shown on the quote page.

Exchange (of Contracts)
See also Contracts
See also the Legal Process

You can't drive away a house like buying a car. Many enquiries and financial arrangements need to be made - and removal men have to be organised!

All the terms of the agreement are set out in the Contract and the Buyer and Seller each have an identical copy. When:

• everything is checked out
• the financial arrangements are in place
• everyone is agreed on the Completion Date (moving day)

The Buyer sends his signed copy of the Contract to the Seller and the Seller sends his own signed copy to the Buyer - by way of exchange! The Exchange of Contracts binds the Seller to sell and binds the Buyer to buy - on an agreed date.

Undertaking
"My word is my bond"

Solicitors are absolutely bound to carry out any undertaking they give. They face serious charges of professional misconduct if they do not.

In reality - many day to day transactions cannot be carried out unless solicitors know for certain that they cannot rely on any undertaking given by another solicitor.

For example, when a Buyer pays for a house - it is vital that any existing mortgage is discharged (otherwise the Buyer may become responsible for it). A Buyer's solicitor will only pay the purchase money on the basis of the Seller's solicitor's undertaking to discharge any mortgage after completion (usually out of the Purchase money).

Fixture, Fittings & Contents Form
This is completed by the Seller and given to the Buyer along with the draft Contract and Property Information form.

It sets out a full and comprehensive list of all the different kinds of fixtures and fittings which the Buyer will include (or not include) in the sale - and also those things which the Seller will be prepared to sell separately.

A fixture and fitting is any item which is ordinarily attached to property - and which is not likely to cause damage if removed. Obvious examples of fixtures and fittings are things such as fitted cupboards, fitted kitchens and curtain pelmets. Things like carpets and curtains are not fixtures. Things like light fittings can be more difficult to decide about. Light bulbs are not fixtures and some light shades may also not be. The majority of significant light fittings are - but it is best to be sure.

Freehold /Leasehold
There are only two types of legal estate in land - or in other words, the extent of ownership.

• Freehold - absolute ownership
• Leasehold - a long Lease at a (usually) low rent

Freehold really means full, or absolute, ownership.

Leasehold is more limited than freehold. Leasehold land is really the benefit of a long lease - usually granted for 99 years or as much as 999 years. A nominal rent will be payable to the Landlord - which is usually the person who owns the Freehold. Of course, a lease of, originally, 99 years may only have a few of the original years left by the time it is sold. There are provisions in law which may entitle the 'Tenant' to force the Freehold owner to sell the Freehold to the Tenant - bringing an end to Leasehold.

Properties such as Flats are often Leasehold - particularly where there is some degree of sharing arrangement between adjoining owners. The rent can also include additional sums for management and sharing expenses.