Anti-Money Laundering (AML) Compliance: A Critical Aspect of Property Transaction
Money laundering, the process of disguising the origins of illegally obtained money, poses a significant threat to the global finance system. In context of property transactions, anti-money laundering (AML) regulations have become increasingly important to prevent property from being used as a means of laundering illicit funds.
The Importance of AML Compliance in Property Transactions
Property is an attractive avenue for money laundering due to the high value and relative stability of property investment. Criminals often purchase properties to convert illicit cash into legitimate assets, making it difficult for authorities to trace the origins of the funds. To address this, jurisdictions worldwide have introduced stringent AML regulation requiring property professionals to carry out due diligence on their clients and transaction.
AML compliance is not only a legal requirement but also crucial for upholding the integrity of the property market. Failure to comply with AML regulations can lead to severe penalties, including substantial fines and imprisonment. Furthermore, property firms that neglect these regulations risk harming their reputation and losing the trust of clients and partners.
Legal Obligations Under AML Regulations
Lawyers, estate agents, brokers, and other professionals involved in property transactions are considered “reporting entities” under AML laws. This designation requires them to adhere to several key obligations, including:
- Customer Due Diligence (CDD): Reporting entities are required to carry out comprehensive CDD to verify their client’s identities and understand the nature of their transactions. This involves obtaining and validation identification documents, accessing the client’s risk profile, and establishing the source of funds involved. Enhanced due diligence must be applied for higher-risk clients, such as politically exposed person (PEPs) or those from high-risk jurisdictions.
- Enhanced Due Diligence (EDD): In situation where there is a higher risk of money laundering, Enhanced Due Diligence measures are applied. EDD requires more in depth and continuous monitoring of the customer relationship.
- Ongoing Monitoring: AML checks do not end with the initial CDD. Financial institutions and other obligated entities must continuously monitor transactions and customer behaviour to detect and report suspicious activities.
- Suspicious Activity Reporting (SAR): When a business identifies a transaction or behaviour that raises suspicion, it must file a Suspicious Activity Report (SAR) with the National Crime Agency (NCA). The SAR allows authorities to investigate further and, if necessary, freeze asset or take other actions to prevent the laundering of funds.
AML Checks in the UK are a vital part of the country’s strategy to combat financial crime. Through stringent regulation, comprehensive due diligence processes, and ongoing monitoring, the UK aims to protect its financial system from being exploited by criminals. However, as financial crime evolves, so too must the methods and technologies used to combat it, ensuring that the UK remains a global leader in the fight against money laundering.
If you have any questions about buying a house, investing in the UK and AML investigations, please contact us
This article is provided for general information only. It is not intended to be and cannot be relied upon as legal advice or otherwise. If you would like to discuss any of the matters covered in this article, please contact us using the contact form or email us on reception@cnsolicitors.com
Business Expansion Visa - A secret weapon in the context of economic globalisation
Economic globalisation is an inevitable trend. In the post-pandemic era, the global economy is gradually recovering, and cross-border development has become a pursuit for many companies looking to expand their business footprint.
As one of the world's most important financial centres, London naturally becomes the first choice for many overseas enterprises looking to enter the international market.
To align with this trend, the UK Home Office has introduced the Global Business Mobility (GBM) route, which consists of five types of visas:
- Expansion Worker Visa
- Senior or Specialist Worker Visa
- Graduate Trainee Visa
- Service Supplier Visa
- Secondment Visa
What is the Expansion Worker Visa?
The Expansion Worker Visa allows overseas companies to send one or more senior managers or specialist employees to the UK to establish a branch that has not started trading in UK yet.
Comparing it to the previous Representative of an Overseas Business Visa:
Advantages:
- A company is no longer limited to sending just one representative; multiple employees can now be sent to establish a branch and conduct business in the UK.
Disadvantages:
- This visa is valid for a maximum of 2 years, with each issuance lasting 1 year.
- The time spent on this visa cannot be accumulated towards the 5-year residency required for settlement.
Please note:
Priority service is not available for the application for the Expansion Worker sponsorship license therefore, the decision could take up to six months. Therefore, it is advisable to consult with an immigration specialist in advance to secure the sponsorship license as quickly as possible.
Eligibility Requirements:
The Expansion worker must have worked for the employer outside the UK for at least 12 months, evidenced by 12 months of pay slips. If the applicant's annual salary exceeds £73,900, the work duration requirement is waived, and fewer pay slips can be provided.
The applicant must meet the minimum annual salary requirement of £48,500 or the current salary requirement for the role as listed in the occupational list, whichever is higher.
The applicant must be engaged in an eligible occupation, such as Chief executive, engineering manager, finance manager, sales director, marketing manager, etc. (For a specific list of eligible occupations and codes, refer to the link: Global Business Mobility Eligible Occupations and Codes).
Documentation requirements for Expansion Worker Visa:
Basic information and documentation include:
- Certificate of Sponsorship (CoS): including reference number, employer name, and employer's sponsorship licence number
- Passport and national identity card
- Proof of the applicant's job position and salary, such as employment contract, confirmation letter of employment, payslips
- UK occupation code
- Maintenance funds proof: a bank statement showing at least £1,270 in savings for 28 consecutive days
- Tuberculosis test report: required for some countries (detailed list available at TB Test for UK Visa) https://www.gov.uk/tb-test-visa/countries-where-you-need-a-tb-test-to-enter-the-uk）
Please note:
- If the applicant has been living in the UK for 12 months, maintenance funds proof is not required.
- The visa application must be submitted within 3 months of receiving the CoS.
- All documentation must be in English or translated by a certified translation agency.
- The immigration office may request additional documents, depending on the applicant's background.
The initial Expansion Worker Visa allows the applicant to stay in the UK for up to 12 months. Upon expiration, it can be extended once, however, each applicant is limited to one extension. This means the maximum stay on this visa is 2 years.
After the Expansion Worker Visa expires, it is possible for the applicant to switch to other long-term visas or other visas under the Global Business Mobility route, such as the Senior or Specialist Worker Visa or the Skilled Worker Visa upon meeting the requirements.
Please note:
If you have held an ICT visa and visas under the Global Business Mobility route, the total time on these visas cannot exceed 5 years within any 6-year period.
The application fee for the initial and extension is £298. The processing time for application outside the UK is 3 weeks, and for applications within the UK, it is 8 weeks. Please refer to the government website for the most up to date information.
Applicants can also apply for dependent visas for their partner and children.
Summary
Advantages:
- Allows overseas companies to send multiple employees simultaneously.
- No language requirement.
- Lower financial maintenance requirements.
- Low visa application fee.
Disadvantages:
- Does not lead to settlement in the UK
- Short visa duration
- High annual salary requirement
- High requirements for the parent company
For Companies: The Expansion Worker Visa allows the parent company to send multiple senior employees to the UK to establish a branch, making the business expansion process more efficient compared to the Representative of an Overseas Business Visa, which only allowed one representative. This is ideal for overseas companies looking to expand their business in the UK. It is also a type of guarantee when using a mature parent company to address multiple employees' work and living needs in the UK simultaneously.
For Applicants: The preparation period and costs for applying for this visa are extensive, requiring a strong background from the parent company to meet the sponsorship requirements. To stay in the UK and obtain permanent residency, applicants need to switch to different visa types, increasing the time cost for applying for permanent residency.
This article is provided for general information only. It is not intended to be and cannot be relied upon as legal advice or otherwise. If you would like to discuss any of the matters covered in this article, please contact us using the contact form or email us on reception@cnsolicitors.com[/vc_column_text][/vc_column][/vc_row]
TA6 Property information Form update
The TA6 form is a crucial document used in the UK property conveyancing process. It is part of a Law Society’s suite of forms and is officially known as the “Property Information Form.” The TA6 form is completed by the seller and provides detailed information about the property to prospective buyers. This information helps buyer make informed decisions and addresses any potential issues before the sale is completed.
Currently the TA6 covers 14 separate subjects with question to be answered by the seller. These are:
- Boundaries
- Disputes and complaints
- Notices and Proposals
- Alterations, planning and building control
- Guarantees and warranties
- Insurance
- Environmental matters
- Rights and informal arrangements
- Parking
- Other charges
- Occupiers
- Services
- Connection to utilities and services
- Transaction information
While currently completing a TA6 form is not mandatory. Omission or delay in providing the same may delay the sale. As you’re trying to sell your home, you’ll not doubt want to get a move on, so filling in the form as thoroughly as possible will get your sale off to a good start.
The form includes instruction to seller that they should:
- Complete the form to the best of your knowledge
- State if you don’t know the answer to any question
- Be accurate, if you give incorrect or incomplete information to the buyer, the buyer may make a claim for compensation from you or refuse to complete the purchase.
- Inform your solicitor immediately if you become aware of any information which would alter any replies you have given
- Give your solicitor any letters, agreement or other paper which help answer the question
In March 2024, the Law Society published the TA6 (Fifth Edition) Property Information Form. Initially, it was set to be mandatory for all Conveyancing Quality Scheme (CQS) firms from June 25, 2024.
The form has been updated to include information that the National Trading Standards Estate and Letting Agency Team (NTSELAT) says should be disclosed on a property listing. The idea behind the new form is that a client should contact their solicitor and complete this form earlier so that more information can be used for marketing the property. This should give buyers an increased knowledge of the property and reduce the likelihood of the transaction falling through at a later stage when extra information is revealed.
The Law Society President Nick Emmerson says: “Earlier contact between sellers and their solicitors may provide an opportunity to address any issues that could cause delays in the sale process at a later date. We hope that the TA6 will help facilitate the flow of information from marketing a property by estate agents through to the legal process. The aim is that having better informed buyer could help reduce both the time process takes and the number of sales that fall through.
The new form has been split into two parts:
Part 1 deals with material information which your estate agent will require, for instance, Council Tax Band, Physical Characteristics of the property or Building Safety while Part 2 deals with general information and should be completed. These include queries regarding Boundaries, Disputes and complaints or Transaction Information, etc.
While the intention behind the updates was to enhance transparency and efficiency in property transactions, several concerns have been raised regarding the practical implications and effectiveness of the new form. Here are some of the criticisms:
- Complexity and Length – Many argue that the new TA6 form is overly complex and lengthy. The increase level of details and additional questions may overwhelm both buyer and seller, leading to confusion and potential errors in completion. This could result in longer transaction times, as parties may require more time to understand and complete the form accurately.
- Increased Burden on Seller—The new TA6 form places a greater burden on sellers to provide detailed information about the property. This includes additional disclosures related to environmental factors, building work, and insurance claims. The increased burden on the sellers to provide detailed information and potentially obtain additional assessments or reports could increase the overall cost of selling a property.
- Uncertainty about Effectiveness—Some question the effectiveness of the new TA6 form in achieving its intended goals of improving transparency and efficiency in property transactions. There is uncertainty about whether the increased level of detail and additional disclosures will genuinely benefit buyers and sellers or simply add complexity to the process without significantly improving outcomes.
However, the Society of Licensed Conveyancers (SLC) has expressed its disappointment that the Law Society has updated the TA6 forms without their consultation. Simon Law, the Society Chairperson, says: “We are disappointed to note that the forms have been amended without consultation with either the SLC or the Conveyancing Task Force. Adding material information to these forms has drastically increased the size of the forms and information required.”
Following the backlash, President Nick Emmerson wrote an article in The Law Society Gazette addressing the concern, saying: “We have heard your feedback and want to explain in more detail the reasons behind the changes to the form, which was developed by a working group conveyancer with a wealth of experience of working on the transaction form. Our aim with the new TA6 is to help solicitors and consumers implement the NTSELAT material information guidance as seamlessly as possible.”
However, The Law Society has delayed the mandatory use of the updated TA6 form from June 2024 to January 2025. Ian Jeffrey, the Chief Executive Officer of the Law Society of England and Wales, explained, “We recognise that we have not yet persuaded enough of our colleagues on these particular changes, so we need to do more to communicate with the profession about them.” Until 15th January 2025, firms can use either the 4th or 5th edition of the TA6 form.
In conclusion, the updated TA6 Property Information Form, now in its fifth edition, introduces significant changes to enhance transparency and efficiency in the property conveyancing process. Mandated for use by Conveyancing Quality Scheme firms from June 2024, the revised form includes comprehensive disclosures recommended by the National Trading Standards Estate and Letting Agency Team. By requiring sellers to provide detailed information earlier in the transaction process, the updated TA6 aims to inform buyers more thoroughly and reduce the risk of sales falling through.
The change has not been without controversy. Criticisms focus on the increased complexity and length of the form, the additional burden placed on the seller, and doubt about the form’s overall effectiveness in achieving its goals. The Society of Licensed Conveyancers and many professionals in the field have expressed concerns, highlighting the need to balance thorough disclosure and practical usability. Hopefully, the delay will allow for these issues to be addressed and for better communication with the profession.
As part of our commitment to maintaining the highest standards under the Conveyancing Quality Scheme, Chan Neill Solicitors LLP will begin using the new TA6 form from 15th January 2025. Please do not hesitate to contact us for guidance or support. We will provide clear instructions and examples to help you complete the new form accurately. Our team will be available to answer any questions about specific sections or the information required.
This article is provided for general information only. It is not intended to be and cannot be relied upon as legal advice or otherwise. If you would like to discuss any of the matters covered in this article, please contact us using the contact form or email us on reception@cnsolicitors.com
Understanding the Building Safety Act 2022: Why Do We Need It in Conveyancing Practice?
The Building Safety Act 2022 represents a landmark legislative endeavour aimed at addressing the systemic failures and deficiencies exposed by incidents such as the Grenfell Tower tragedy. The fundamental purpose of the Act is to provide a framework for maintaining the integrity and safety of high-risk residential buildings and thus ensuring public confidence. The purpose of this article is to investigate the Building Safety Act 2022 and seek an explanation as to why its implementation in conveyancing practice is crucial for protecting stakeholder interests.
What are the new roles created by the Act?
Chief among these roles is the establishment of the Building Safety Regulator (BSR), tasked with implementing standards, conducting inspections, and enforcing adherence to regulatory standards, thereby representing a shift in the regulatory landscape. The Act also introduces the designation of the 'Accountable Person,' who is responsible for ensuring that high-risk buildings are safe and maintaining effective, productive communication with residents. These new roles represent a fundamental shift in the regulatory landscape, emphasising the importance of proactive risk management and stakeholder engagement.
The Building Safety Regulator (BSR)
BSR presents a thorough strategic framework, the timeframe of which extends from the implementation of the Building Safety Act 2022 to April 2026 and beyond. The strategic framework presents the following main objectives:
- Implementing strict safety measures for high-risk buildings, covering the aspects of design, construction and ongoing maintenance.
- Undertaking thorough audits and inspections to identify safety hazards and enforce adherence to regulatory standards.
- Cultivating effective communication with stakeholders, such as industry professionals, residents and owners, to facilitate accountability and transparency.
- Offering building owners and managers support and in enacting measures aimed at proactive risk management and adequately amending safety concerns.
- Enabling residents to access vital information about the safety of their residence and participate in the safety management process.
- Responding to emerging challenges and lessons learnt from previous incidents by continuously assessing and amending regulatory frameworks.
- Cooperating with government agencies, regulatory bodies and industry stakeholders to promote best practices and innovations in building safety.
The principles in the strategic framework aim to instil public confidence in high-risk building safety and reduce the likelihood of catastrophic incidents. By fostering proactive collaboration and engagement, the BSR seeks to ensure the long-term well-being of building residents and their communities. The framework also highlights the importance of informing clients about all potential liabilities and risks associated with their investments.
Definition of a High-Risk Building?
A high-risk building is defined based on several factors, such as construction materials, occupancy, and height. High-risk residential buildings that are found to exceed the height threshold are categorised as high-risk given the potential for structural vulnerabilities and the spread of fire. In addition, buildings featuring historical deficiencies, complex facades, or mixed-use occupancies may also be categorised as such.
Accountable Person
The role of Accountable Person is responsible for ensuring that high-risk buildings are safe and maintaining effective, productive communication with residents. The implementation of this role presents a duty of care to property owners and managers, enforcing mandatory proactive measures for identifying and amending all safety hazards. From the perspective of conveyancing, this requires careful scrutiny of the role of Accountable Person in order to alleviate the risk of accidentally transacting in properties beleaguered by issues related to safety.
Conveyancing practitioners play a crucial role in facilitating transparency and dialogue between sellers, buyers, and stakeholders, ensuring everyone is aware of their obligations. Promoting open communication enables practitioners to enhance risk mitigation and accountability within the real estate sector.
The Building Safety Act 2022 enhances residents' rights and protections, granting them access to vital safety information about their homes. This fosters engagement and transparency, empowering residents to actively participate in safeguarding their communities and promoting collective responsibility and vigilance. For conveyancing practitioners, it underscores the importance of helping clients make informed decisions and understand their rights as homeowners.
In summary, the Building Safety Act 2022 is pivotal in ensuring safety, transparency, and accountability in the built environment, transforming real estate law. Its implementation in conveyancing is both a legal requirement and a moral imperative, demanding proactive client advocacy and risk management. Conveyancing practitioners who fully embrace the Act's principles can safeguard their clients' interests, promote safety and integrity in built environments, and uphold high standards of ethical conduct and professionalism.
This article is provided for general information only. It is not intended to be and cannot be relied upon as legal advice or otherwise. If you would like to discuss any of the matters covered in this article, please contact us using the contact form or email us on reception@cnsolicitors.com
Town and Country Planning Act abandoned ‘Four-year rule’, what are the impacts?
The Levelling-up and Regeneration Act 2023 significantly advances the UK's urban development and planning regulations. Enacted on 26th October 2023, this comprehensive reform significantly amends the country's planning system, impacting developers, property owners, and local planning authorities, especially regarding unauthorised developments. One critical change is the amendment to Section 171B of the Town and Country Planning Act (TCPA) 1990, which alters the enforcement period for unauthorised developments.
Previously, the "four-year rule" under the TCPA 1990 provided immunity from enforcement action for developments or land uses existing continuously for four years without challenge. However, the Levelling Up and Regeneration Act 2023 extends this period to ten years in England, effectively doubling it. This extension offers local planning authorities in England a broader timeframe to address unauthorised developments, potentially reducing instances of unauthorised construction.
This amendment significantly impacts enforcement practices, development dynamics, and due diligence processes. Developers and property owners now face increased scrutiny and must exercise greater caution when undertaking projects without proper planning permissions. The extension provides local planning authorities in England with more time to curb unauthorised construction and enhance adherence to planning regulations.
The transitional provision accompanying this amendment ensures consistency in enforcement practices, maintaining the previous four-year enforcement window for developments completed or breaches occurring before 25th April 2024. However, it also introduces regional disparity in planning legislation between England and Wales, potentially resulting in divergent approaches to addressing unauthorised development.
The rationale behind extending the enforcement period is multifaceted, aiming to enhance regulatory compliance, deter unauthorised construction activities, and support sustainable development. Overall, the Levelling-up and Regeneration Act 2023 represents a significant step forward in the UK's planning system evolution, with the extension of the enforcement period for unauthorised development standing out as a prominent amendment.
In conclusion, this legislation heralds a new era in town and country planning, characterised by extended enforcement periods and regional variation in legislation. By providing local planning authorities in England with more time to address unauthorised developments, this change aims to promote regulatory compliance and sustainable development practices. However, it also emphasises the importance of vigilance and strategic navigation of planning regulations in the evolving urban landscape of the UK.
If you plan to purchase a regarding residential properties, commercial properties or engage in any real estate transactions, please get in touch with Chan Neill Solicitors. Our team of property solicitors has extensive experience in assisting local and overseas buyers on their journey to settling in their new homes.
This article is provided for general information only. It is not intended to be and cannot be relied upon as legal advice or otherwise. If you would like to discuss any of the matters covered in this article, please contact us using the contact form or email us on reception@cnsolicitors.com
Strengthening Law firms in the Wake of the CTS Cyber Attack
The increasing reliance on digital technologies across various industries casts a long shadow of cyber threats, prominently exemplified by the CTS cyber-attack. This significant incident in the conveyancing sector has highlighted the vulnerability of law firms to such digital dangers. More than just causing operational disruptions, the attack served as a critical wake-up call, emphasising the urgent need for robust cybersecurity measures. With cloud-based services now a norm for the easy exchange and storage of information, it is crucial for law firms to be mindful to the security implications of these technologies. The CTS cyber-attack was a clear alert to the potential weaknesses in digital defenses, allowing law firms to develop comprehensive strategies against future intrusions. In this era of digital dependency, strong cybersecurity measures have become an essential cornerstone for industry resilience against ongoing and evolving cyber threats.
The recent cyber-attack has highlighted the fragility of cloud-based storage and services that countless law firms depend on for managing and sharing data. Despite their apparent convenience, these platforms come with inherent security risks. It is imperative that firms not only choose cloud service providers with robust security measures but also maintain strict access controls internally. The scope and severity of the attack's impact was profound, with more than 80 law firms experiencing varying levels of operational disruption. The inability to access systems, process transactions, or maintain operational continuity led to considerable setbacks in the property exchange process, as highlighted by The Law Society's report on the CTS incident. This starkly illustrates the urgent need for reinforced cybersecurity measures within the legal sector.
In the immediate aftermath of the attack, CTS took substantial steps to restore their systems and reassure their clients. By December's end, CTS announced the restoration of their systems, marking a significant milestone in the recovery process. Yet, this event is a stark reminder that cyber threats are an ongoing concern that will likely escalate. The ramifications of such attacks are profound: the loss of productivity, revenue, and—most critically—reputation, as client trust erodes due to potential data breaches. These consequences underscore the importance of a comprehensive approach to cybersecurity, extending beyond the immediate technical response to include broader operational and strategic considerations.
Reflecting on the cyber attack, it is evident that many law firms were caught unprepared and unable to access their systems or complete essential transactions. This incident highlights the critical need for continuous and robust cybersecurity measures. Law firms must regularly review and upgrade their digital security protocols, adapting them to the ever-evolving landscape of cyber threats. This approach is not merely about implementing security measures; firms must continuously evaluate and adapt to stay ahead of the constantly evolving cyber threats. The CTS incident serves as a pivotal learning experience, indicating that such attacks are not singular events but signs of potential ongoing challenges. Law firms need to proactively minimise the risk of cyber-attacks through regular updates to security practices, comprehensive cyber insurance coverage, and a forward-thinking stance on digital risk management. Embracing this proactive and adaptive approach is crucial for law firms to safeguard against the far-reaching impacts of future cyber disruptions.
This article is to help raise awareness to law firms on how they should continuously review their online presence and reliance upon cloud-based technologies. Criminals target law firms, particularly those that have a property division. Criminals want to try to gain access to data which may assist them in defrauding clients or the lawyers who represent them. The CTS cyber attack is a serious reminder of the constant and evolving nature of cyber threats. It underscored the importance of perpetual vigilance and the need for law firms to consistently update their cybersecurity protocols, invest in comprehensive cyber insurance, and adopt a proactive approach to digital risk management. As firms navigate the complex digital landscape, the lessons from this incident will be invaluable in fortifying their defences against future cyber threats.
This article is provided for general information only. It is not intended to be and cannot be relied upon as legal advice or otherwise. If you would like to discuss any of the matters covered in this article, please contact us using the contact form or email us on reception@cnsolicitors.com
UK Mortgage | Legal Counsel Approved by Lenders
In the UK, a Loan is a way for most people, especially for office workers to buy a property. With rents in the UK going through the roof, more people are considering taking out a bank loan to purchase a property to have a stable place to live.
The most familiar procedure of purchasing a property is that once the budget has been confirmed and the offer has been accepted by the seller, the seller will need to appoint a property solicitor to handle the whole purchase process for them.
However, it is not necessarily for the buyer to appoint a solicitor with their will.
What is a Bank Panel?
The buyer’s conveyancing must transfer both the deposit and the loan funds to the seller.
When obtaining a loan to purchase a property in the UK, it is common practice to engage a property solicitor to represent both the bank, and the lender, and provide various legal documents.
Therefore, it is crucial to instruct a trustworthy property solicitor for the lender’s benefit.
This means the buyer must gain the Lender’s approval for their chosen property solicitor before proceeding. Failure to do so may result in the lending bank denying the loan application.
To facilitate the choice of property buyers, the vast majority of UK banks will pre-screen law firms that they believe are qualified, reputable and can be confidently instructed to add to their list of Panels to work with. That being said, banks are usually only willing with solicitors who are on their panel.
What can Property Solicitors do for Lenders?
If the property is purchased using a mortgage, the buyer will need to provide the Lender with the property solicitor’s details and the Lender will then need to transmit the Mortgage Offer to the solicitor.
Meanwhile, the solicitor is obliged to report to the Lender on relevant circumstances and changes regarding the buyer and the property, such as the results of the AML check on the buyer’s fund for the purchase of the property, and whether there has been a change in the price of the property.
*AML check – Anti-money laundering checks are one of the customer due diligence measures required by regulated businesses to comply with money laundering regulations and prevent financial crime.
All of this can potentially affect the amount the Lender ultimately lends to a buyer.
Before handing over the property, the solicitor will submit a title deed requesting the loan funding following the lender’s drawdown regulations.
So if the buyer doesn’t instruct a solicitor on the Bank Panel, will it still work?
Although there is no requirement to instruct a solicitor on the bank’s Panel to buy a house in the UK. But if you don’t, the Lender will employ another solicitor on their Panel in addition to the solicitor employed by the buyer to look after the transaction.
Then with the seller’s property solicitor, there will be a total of 3 solicitors involved in the property transaction and communication between the parties will take longer.
At the same time, the Lender’s legal fees for appointing a solicitor are generally paid by the buyer, and if the buyer does not choose the solicitor on the Panel, the buyer will have to pay an additional amount for legal fees, so it is not recommended that you do so.
Which banks are Chan Neill Solicitors on the Panel?
Chan Neill Solicitors has been established for 20 years and has built up a good reputation and credibility among clients and various partner organisations as a professional legal institution worthy of trust.
We are Panel members of over 60 banks and financial institutions in the UK, including Lloyds Bank, Barclays, HSBC, Metro Bank, Royal Bank of Scotland, Halifax and other smaller banks or financial institutions.
As well as providing legal services to both the buyer and the bank at the time of the purchase, our property solicitors can take care of the formalities required after handover, which include:
- Payment of Stamp Duty Land Tax ( SDLT)
- Land Registry
When the registration of the property is complete, the solicitor will forward the registered title to you to confirm that you own the property. The solicitor will also send a copy of the title deeds to your lender.
If you are planning to purchase a property with a loan, you are welcome to contact Chan Neill Solicitors on Instagram, Facebook, LinkedIn, and Twitter or call us on 020 7253 7781. Our team of property solicitors have extensive experience in acting for both local and overseas buyers and will be able to help you on your journey to settling in your new home.
Artificial Intellegence – a conveyancer’s friend or foe
Technology's influence has been reshaping traditional practices for generations. Conveyancing is no different and conveyancers are now having to come to terms with the integration of artificial intelligence (AI). AI is transforming conveyancer’s day to day working lives. It is changing how conveyancers obtain search results, conduct due diligence, ensure security and navigate regulatory complexities. However, whilst the use of AI can be used as a force to enhance the industry’s effectiveness, there will always be those who see opportunities to fraudulently manipulate technology and AI is certainly no exception.
The conventional process of gathering search results has often been hindered by delays and cumbersome data retrieval. AI is changing this narrative by swiftly scanning and sorting through large volumes of data. AI expedites the extraction of pertinent information, providing conveyancers with a comprehensive overview in a fraction of the time it used to take. This acceleration not only reduces waiting times but also allows for prompt decision-making, a crucial element in the time-sensitive world of property transactions. AI's integration into the realm of conveyancing is not only accelerating the acquisition of search results but also reshaping our approach to information retrieval.
Due diligence, a crucial phase of any property transaction, has traditionally involved laborious manual searches through extensive volumes of data. AI has revolutionised this process by rapidly scanning large datasets to reveal any point of note associated with a property, its owners, and its prospective owners. By automating this data intensive task, AI accelerates due diligence timelines and reduces the risk of crucial information ever being missed. Conveyancers can now offer clients a more efficient and comprehensive due diligence process, enhancing trust and the speed of transactions.
Navigating the intricate network of regulatory compliance and legislative changes is a challenge faced by all legal professionals, and particularly for those working within the everchanging frameworks of property related regulations and legislation. AI allows conveyancers to constantly monitor amendments, to keep pace with changing regulations and legal requirements. Conveyancers can rely on AI to stay up to date with the latest guidelines and legislation, ensuring that every transaction adheres to the highest standards of legality as well as ethical practice. This insight provided by AI offers conveyancers a sense of assurance that their transactions remain compliant in a constantly changing regulatory landscape.
The incorporation of AI into conveyancing is not just about expediting processes; it's about improving the entire experience for both conveyancers and clients. AI's speed in gathering search results, its predictive abilities in risk assessment, its ability to streamline due diligence, and its ability to help ensure regulatory compliance are helping the industry toward a future marked by efficiency and accuracy. As AI continues to evolve and integrate seamlessly into conveyancing practices, the industry is in a position to offer an even higher standard of service and assurance to those navigating the intricate world of property transactions.
Like many industries at this point in time, the advantages AI provides conveyancers must be met with caution. Whilst AI has emerged as a powerful tool with the potential to revolutionise the field of conveyancing, it also brings forth its own set of threats that must be carefully considered.
One concerning aspect is the emergence of AI-powered fraud schemes. As AI technology becomes more sophisticated, criminals will exploit it to create intricate and hard-to-detect fraudulent activities. AI-driven algorithms can generate fake documents, impersonate identities, and manipulate data, posing significant challenges to traditional fraud prevention methods.
The vulnerabilities in cybersecurity cannot be ignored. AI systems themselves can become targets of cyber attacks. If fraudsters manage to compromise AI algorithms or access crucial data, they can leverage the technology against the very systems meant to safeguard against fraud, potentially exposing sensitive client information.
Recently, fraudsters have been able to use public data leaks to use AI algorithms in order to comb through email accounts involved in leaks. The criminal’s algorithms will identify those accounts containing emails with key-words associated with property transactions. Once identified, the fraudsters will target said accounts, the accounts of property purchasers more often than not, with emails enticing purchasers to send funds to fake client accounts. Whilst clients may recognise that something is not quite right with the emails, the importance of personal relations is evident here. A client having full knowledge of their transaction, knowing that this may be a strange time to send funds, will prevent them from ever doing so.
Another critical consideration is the issue of human oversight. Although AI excels at processing vast amounts of data and recognising patterns quickly, it lacks the nuanced judgment and intuition inherent in an experienced conveyancer. Relying solely on AI systems for fraud prevention may lead to false positives, flagging legitimate transactions as fraudulent, or false negatives, overlooking genuine instances of fraud. AI algorithms learn from historical data, which can contain implicit biases. This can inadvertently lead to discriminatory practices, where certain individuals or properties may be unfairly targeted or excluded from transactions based on historical patterns.
Additionally, legal and ethical challenges come to light with the adoption of AI in fraud prevention. Determining accountability and liability for AI related fraud can be complex, raising questions about who bears responsibility when an AI system fails to prevent fraudulent activities is a fresh issue the industry does not have a definitive answer to.
To address these concerns, it is essential to strike a balance between implementing the advantages of AI and the significance of human involvement. Combining AI systems with human expertise and judgment can ultimately enhance the overall effectiveness of fraud prevention measures.
Looking to the future, there is of course a risk of overreliance on technology. The convenience and efficiency that AI brings might inadvertently lead professionals to become complacent in detecting potential fraud when they overly rely on AI systems to handle the task. Combining this with the use of AI by fraudsters themselves and there is certainly cause to be cautious of AI and its impact on the conveyancing process.
Legal work will always be an industry which requires a human touch. Clients rely on a conveyancers personal experience and person ability in the same way they rely on their skills in dealing with the law. Incorporating AI into the world of conveyancing has to be a conscious process which considers all advantages and disadvantages. As always, the client, their goals and their experience, will remain at the heart of all legal work. Conveyancing is no different.
Illegal entry into the UK can harm your chances of getting permanent residence or citizenship
On 20 July 2023 the Illegal Migration Act 2023 received Royal Assent. Under the new Act, migrants who entered the UK illegally after 7 March 2023 will be barred from re-entering the UK or gaining residence or citizenship, and the ban will also apply to their UK-born children. The UK government will have a duty to refuse to process any asylum claims they make and to return them to their home country or a safe third country where their asylum claims will be processed.
The purpose of the bill is to " prevent and deter illegal immigration, particularly through unsafe and illegal routes, by requiring the removal from the UK of certain persons who enter or arrive in the UK in breach of immigration controls" '.
There are exceptions to this ban, however, as illegal immigrants may be exempted if they can prove that they have come to the UK from "a country which complies with the United Nations Convention on Refugees and where their life and liberty are at risk". However, since most illegal immigrants enter the UK through EU countries such as France, none of which fulfil these conditions, the threshold for exemption is quite high.
The United Nations has warned that the Illegal Immigration Bill passed by the British Parliament is inconsistent with the country's obligations under international human rights and refugee law and sets a worrying precedent for the abrogation of asylum-related obligations, which could be followed by other countries, including in Europe, and which could have a negative impact on international refugees.
The professional immigration team at Chan Neill Solicitors can provide you with the most suitable immigration solution based on your background. If you require any assistance, kindly reach out to us.
How Can A Leaseholder Extend Their Lease?
There are two ways that a Leaseholder (Tenant) can extend their lease:
1) Privately Agreed (Informal) Route
2) Statutory (Formal) Route
Private (Informal) Route
The Tenant could approach their Freeholder (Landlord) to request whether the Landlord would be agreeable to negotiate a lease extension. Although this private route could save time and money however, there is no obligation on the Landlord to respond or agree to extend the lease.
If in the unfortunate events that the negotiation discussion between the Landlord and Tenant come to an end without any successful conclusion then the Tenant could consider whether they are able to extend the lease under the Statutory Route.
It is important to note that privately agreed lease extension requires lender’s permission. Therefore, if there is a mortgage registered on the Tenant’s property then the Tenant must obtain the lender’s consent.
Statutory (Formal) Route
A Tenant can apply to extend their Lease by the Statutory Route provided that the Tenant is eligible (such as owned a long lease for the past two years).
The Tenant would need to ensure that they have their finances in place in order to commence the Statutory Route. This is because the Tenant would need to pay for the following:
- Surveyor’s fees to value to a new lease and negotiations etc
- a premium to the Landlord to extend the Lease (once a premium has been agreed)
- Once the Tenant serves a notice to request for a new lease then the Tenant will be liable for the Landlord’s costs
- Landlord’s fees to extend lease
- Solicitors costs etc
The Statutory Route has strict timelines that the Tenant must comply with. If the Tenant fails to comply with the timescales then unfortunately the Tenant would have to wait 12 months before starting the Statutory Route again. There is no requirement for lenders consent under the statutory lease extension route.
Terms of the New Lease
Under the Statutory Rules, the Terms of the New Lease are as follows:
- Peppercorn ground rent (£0 ground rent) for the whole of the term
- 90 years extension plus the length of time left on the current lease
- Terms must be the same except for minor modification and exclusions allowed by law.
- Premium payable for the new lease
S42 Notice – Tenant’s request for a new lease
Before a Tenant can serve a S42 notice, the Tenant would need to identify who the competent Landlord is. The Tenant should apply to the Land Registry to find out who owns the Freehold Property and check who they pay their service charges and ground rent to.
If a Tenant pays ground rent and or services charges to a management company then all parties (Landlord and Management Company as well as any other relevant person) should be served with a copy of the S42 Notice.
The S42 Notice must contain certain information in order for it to be valid. The Tenant must give the Landlord at least two months to give their counter-notice.
The Tenant should ensure that the S42 notice is protected by way of registration against the competent Landlord’s Title and also of any intermediate Landlord. Failing to protect the initial notice will not bind a purchase of any reversionary interest in the property and therefore, the Tenant will have to start the process again.
S45 Notice – Landlord’s Counter Notice
The Landlord must serve their counter-notice within the 2 months period. The Counter-notice must state one of the following:
- Agree to the Tenant’s right to a new lease and accept the terms and proposed or propose different terms
- Reject to the Tenant’s right to a new lease and explain their reason for this.It would then be up to the Court to decide whether the Tenant has the right
- Claim that the Landlord has the right to redevelop the land (appliable only in certain circumstances)
If the Landlord has served a Counter-notice then it would be down to the parties surveyors to negotiate on a premium. If in the unfortunate event that an premium cannot be agreed after the first two moths of negations, then both parties can apply to the Tribunal for an independent decision to be made. The application must be made within 6 months from the Landlord’s counter-notice.
Once a premium has been agreed then the parties legal representatives can negotiate on the terms of the lease. There are strict timelines on when the new lease terms must be agreed and when a claim must be made to the Tribunal.
In the event that the Landlord fails to serve a counter-notice, then the Tenant has the right to apply to the Court to seek an order for the grant of the new lease (on the terms as set out in the S42 Notice). This application must be made within 6 month from the date in which the counter-notice was required to be served.
If you are thinking of extending your lease or have any queries, please contact us. Our experienced property solicitors and litigation team have dealt with different types of lease extension.