Lawyers regularly use technical language and legal words and phrases, which can make it difficult for clients to understand the stage their matter is up to and, to make matters worse, lots of lawyers also use different words to mean the same thing!
Here at Talbots Law, we like to keep things simple. Our ‘Jargon Buster’ for Conveyancing transactions will help our clients to navigate their way through some of the terms they are likely to encounter throughout the course of their own conveyancing transaction:
| Vendor | The seller of a property |
| Purchaser | The buyer of a property |
| Memorandum of Sale/ ‘Memo of sale’/ ‘Memo’ | The document prepared by the Estate Agent (or site office for a new build property) when a sale is agreed. It lists the seller, buyer, both parties’ solicitors, the price agreed and any special agreements relevant to the deal negotiated- e.g. deadlines, special agreements that are part of the deal or (usually) larger expensive items to be purchased in addition to the price e.g. hot tub, Summer Houses, boats etc. |
| Protocol/ National Conveyancing Protocol | A conveyancing procedure and set of forms to support it created to standardise the conveyancing process, invented by The Law Society and recommended to be used by Conveyancers across England and Wales. |
| Protocol Forms / ‘PIFFS’ e.g., ‘TA6, TA10, TA7, TA13 and LPE1’ | These are the Law Society Forms, referred to above, that the Law Society created to be part of the Protocol, recommended by the Law Society for use in Conveyancing transactions. Mainly they are to be completed by the seller (Or a third party e.g. Managing Agent or Landlord, or Seller’s Solicitor) They provide information about a property to a buyer. Each form has a different title and different number. They include forms detailing the fixtures and fittings included in a sale/ excluded from a sale, information about a property including boundaries, utilities, neighbour disputes etc., (and on Leasehold properties, information about Ground rent/service charges etc.) |
| Draft Contract/Contract/ Draft Contract Pack/DCP | The documents prepared by the Seller’s solicitor containing details of the seller, buyer, the property, the title, the price, the deposit, the Exchange date and Completion Date as well as any additional special terms agreed between the parties. We send this to the client to sign and return. The signed Contract is NOT LEGALLY BINDING at this stage: It sits on file until all parties are ready to proceed. The Draft Contract is sent to the Buyer’s conveyancer with the Protocol Forms and supporting papers, together these are called ‘The Draft Contract Pack’ of ‘DCP’ for short. |
| Freehold | The type of land ownership where the owner owns the land and buildings on it in perpetuity- i.e. until you sell or die. If you die the land and buildings form part of your Estate and ownership of it passes in accordance with your Will (or the Rules of Intestacy if there is no Will). |
| Leasehold | The type of land ownership where owner owns the right to exclusively use the land for a defined period of time, subject to compliance with conditions set out in a Lease. E.g. a 99-year lease of a flat where ownership is subject to paying Ground Rent and Service Charges and complying with restrictions in the Lease itself- often not to create a nuisance etc. If you die and there is still time to run on the Lease, the remainder of the Lease Term passes as above. It is valuable because these are often for long periods of time unlike a ‘Tenancy’ which is often only for 6-12 months. Here the Lease is for a defined period, called the ‘Term’. At the end of the lease Term, the Lease ‘expires’ and the Leaseholder must vacate. The Landlord is entitled to take possession of the property upon the expiry of a Lease. |
| Lease | The Deed in which the conditions and length of the Term of any Leasehold title ownership are defined. |
| Freeholder | The owner of the Freehold interest in a property. If they have granted a lease, they may also be referred to as the Leaseholder’s ‘Landlord.’ |
| Lessee/ Leaseholder | The Owner of a Leasehold interest in a property. |
| Managing Agent | Some Landlords appoint a company to manage properties or Estates. They collect Ground Rent/Service Charge and manage provision of communal services. E.g. gardening and maintenance of communal areas. |
| Mortgage | Money borrowed from a Bank or building society, used to buy a property. The Mortgage loan is registered as a debt in the title deeds held by the Land Registry until it is repaid. |
| Mortgage Offer | The document issued by a lender to a buyer and their solicitor in which the terms of any loan by way of mortgage are set out, together with any special conditions that must be complied with. |
| Mortgage Report | The Report we send out to a client buying a property using a mortgage, to inform them of the main points of their mortgage offer. We send the Mortgage Deed with this to be signed, witnessed and returned. |
| Mortgage Deed | The Deed issued with the Mortgage Offer (or downloaded) which we send to the client buying a property using money from a lender in the form of a mortgage. The client must sign the Mortgage Deed in front of a witness and return it to us BEFORE COMPLETION to accept the terms of the mortgage offer issued and to agree to be bound by the terms of the mortgage offer. |
| Enquiries/ Pre-Contract Enquiries | Questions raised by a Buyer’s solicitor to the seller’s solicitor, based upon the Draft Contract Pack and supporting documents -or search results. |
| Replies to enquiries | Answers to the above. |
| Waiver | A document drafted by a solicitor if a client insists on proceeding with a transaction without crucial information. Note: These can often only be used if there is no mortgage, or if the lender has authorised us to proceed notwithstanding an issue we have identified. Waivers are used to record instructions to proceed, despite risk to the client, and to remove any liability from the firm or the conveyancer personally if the client wishes to proceed against our advice or in the absence of important information or search results. |
| Searches: | Local, Environmental and Drainage Searches are done on every file where there is a mortgage. |
| Local Search | A standard set of questions answered by or on behalf of a Local Authority from records in their possession about the property specifically- Planning permissions, Building Regulation Approvals, Tree Preservation orders, Enforcement Notices… and the area in general e.g. Traffic schemes, Smoke Control Zones, is the road adopted and maintained by the council or is it a private road the client will have to contribute towards to maintain… |
| Environmental Search | Contaminated Land can be made subject to a ‘Clean up Notice’ against the person who contaminated the land, or if that person cannot be located, by the current owner. The Environmental Search is done to ensure a property has not been built upon or near contaminated land. If a search returns a ‘Fail’ result, further investigation is needed and results may need to be reported to any proposed mortgage company the buyer wants to borrow money from to buy the property with. |
| Drainage Search | Done to check if the drains, sewers and water pipes serving the property are ‘adopted’ and maintained by the local water authority, or private and to see if any services run under or near to the building- written consent is required to build over or near to drains and sewers passing through the boundaries of a property. |
| Coal Search | Lots of areas including the Black Country have a history of coal and other mine workings. This can lead to subsidence. If entries are revealed further investigation and approval from any proposed mortgage lender is required. |
| Radon/Tin/China Clay searches | Radon Gas can be carcinogenic. It is found in certain parts of the UK. It can be monitored, and measures can be implemented to reduce risk. Tin and China Clay mines can lead to ground instability. |
| Completion Statement | The cash flow statement a conveyancer prepares for a client, to show the client how much money they will receive on completion of a sale, after payment of any mortgage, agents, legal fees and costs of selling, or how much money we need to complete a purchase, including searches, our fees, Stamp Duty and Land Registry and any Management Company fees. We must have any monies needed to complete the transaction in good time for completion. There are rules as to how long monies we receive by different methods take to clear in our account before we can use them. We cannot accept any substantial amounts of money from a client into our Client Account until we have completed all identity and anti-money laundering checks. |
| Redemption Statement/ Redemption Figure | If a client is selling a property that has a mortgage on it, at the start of a transaction we ask the Bank/Building Society to let us have a settlement figure, showing how much money the client owes at that point, for information purposes only. We send this to the client for information purposes, so they can speak to their lender if the settlement figure in the Redemption Statement is not what the client expected. Nearer to the date of legal completion, an updated Redemption Statement is obtained, showing the amount needed to clear the mortgage to the proposed day of Completion. This figure is used as part of the Completion Statement referred to above. |
| Exchange/ Exchange of Contracts/ Exchange Date | The date upon which the seller’s solicitor and Buyer’s solicitor (with consent of their clients) make the Draft Contract Legally binding and fix the Completion Date. At this point the copy of the contract the seller has signed is swapped (‘Exchanged’) for the copy of the contract the buyer has signed, both copies of the contract are dated and the legal completion date is normally fixed and also added to the contract. The deposit is paid to the seller’s solicitor. Once contracts are Exchanged, should either party then fail to complete on the agreed date, financial and legal consequences follow. |
| Completion/ Completion Date | The date upon which the seller is paid the remainder of the purchase monies for the property, keys are handed to the new owner and legal ownership moves from the seller to the buyer. This can be any day Monday to Friday. It cannot be a Saturday, Sunday or Bank Holiday. |
| Transfer/’TR1’/ ‘TP1’ | The Prescribed Form used to record details of the sale of a property and the change of legal ownership. TR1 is used when the transfer is of the entire land in the ownership of the seller. Form TP1 is used when only a part of the seller’s land is being sold. (TP1 is commonly used on newbuild plot purchases, where a plot buyer buys only a small part of the developer’s entire estate). |
| Stamp Duty/ SDLT/ LTT | ‘Stamp Duty Land Tax’ (‘Land Transaction Tax’ – in Wales) is the tax payable upon the purchase -or sometimes the transfer of ownership- of a property in England (or Wales). If the purchase price (or ‘money’s worth’ of consideration is over prescribed monetary limits, tax is payable. In some situations, such as but not limited to: If the buyer already owns a property, is a non-UK resident or is a Company purchaser, this tax is payable at a higher rate. There are online calculators available to help calculate the tax due. There are strict deadlines for completing the SDLT or LTT Return Forms and submitting them to HM Revenue and Customs and there are financial penalties for late submissions. |
| Land Registry/ HMLR | The Government Body responsible to maintaining Registers showing ownership of land, mortgages on Registered Titles and other matters affecting Registered Titles for England and Wales. |
| Registers of Title/ ‘Office Copies’ and Filed Plan/ Registered Title | The Registers kept and maintained by HMLR showing ownership, title plans, copies of deeds, mortgages and restrictions registered against all Registered Titles. On the sale of a property, we obtain a copy of the Registers of Title, any supporting documents or Deeds referred to in them that may contain obligations or restrictions and a copy of the filed plan showing the extent of the property. We supply them to the buyer’s solicitor as part of the Draft Contract Pack/ DCP. |
| Epitome of Title | The name given to the list and bundle of supporting deeds and documents required to prove ownership of a property that has not yet had its title modernised by Registration at HM Land Registry. About 12% of properties in England and Wales are still Unregistered. When these properties are sold, copies of old deeds and supporting documents must be provided to the Buyer’s solicitor, to prove, or ‘deduce’ the seller’s legal title and ownership to the property. These old deeds and documents are listed on a sheet of paper, in date order and collectively they are referred to as an ‘Epitome of Title’. Once an unregistered property is sold, registration at HM Land Registry is compulsory. The old deeds and documents are sent to HMLR with the buyer’s application to be registered as the new owner and the deeds are ‘modernised’: HMLR create a new Registers of Title and an official ‘Filed Plan’ showing the extent of the land within that title and all matters affecting it. |