What buyers need to do after completion?
After picking up your keys and unpacking all your belongings, you’re probably thinking about all the little jobs you have to do now you’ve moved into your new home. Below are a number of tasks which we would recommend you deal with promptly.
Buildings insurance
It is likely to have been a requirement of your mortgage lender (if you have a mortgage) that you would take out building’s insurance on exchange of Contracts. It is therefore vital that you ensure buildings insurance cover is in place on completion. Even if you don’t have a mortgage, buildings insurance is still important as it will cover the costs of repairing damage to the structure of the property.
Meter readings
Unexpected energy costs are the last thing anyone needs just after moving into their new property. As such, it is important to take meter readings on the day you move in to ensure you’re only charged for the energy you use from the date you moved in, and that you’re not being charged for energy usage of the previous owner. If you are unsure, always check with your energy provider how to upload your meter readings.
Updating your address
Although it can be time consuming, updating your address as soon as possible is always best practice. Ensure you update your address anywhere this is held on file, be that your driving license, dental surgery, or any mail services you’re subscribed to.
Your Local Council
It is worth checking the website for your Local Council, as most have a helpful page confirming how you pay council tax, as well as other useful information such as the bin collection days for the property.
Utilities
You will also need to let the properties service providers know that you have moved in, so they are able to update their records. You will need to contact the suppliers of your gas, electricity and water and also contact a broadband provider as soon as possible, as it can take a number of weeks for internet service providers to visit the property to set up your internet, so the sooner you arrange this the better. If you intend on watching television, you will also need to purchase a TV Licence. This can be done online on the TV Licensing website.
Ground Rent/Service Charge
If you have purchased a Leasehold property, you should have been advised prior to completion of any requirements to pay ground rent and/or service charge. On completion, your solicitor will serve notice on the relevant parties to inform them you will be moving into the property. They will then likely be in touch shortly after completion to confirm the sums payable and where they are due to be paid. If you have not heard anything in relation to Service Charge/Ground Rent shortly after moving in, it may be worth double checking with your solicitor that the relevant notice has been served.
Chan Neill property solicitors understand that buying or selling a property can be a stressful time. Our team is well experienced and have stringent protocols in place to streamline the entire process efficiently, providing our clients with peace of mind. Across our team, we speak many languages including Mandarin and Cantonese, Gujarati, Russian, Portuguese, Korean and Spanish.
Chan Neill Solicitors is accredited under the The Law Society’s Conveyancing Scheme Qualification (CQS), which provides a recognition of our residential conveyancing standard and quality and is officially recognised by a range of mortgage lenders which grant us access to their residential mortgage lender panels.
If you have any enquiries regarding residential properties, commercial properties, buying or selling a property or properties owned by a limited company, please contact us. With access to our solicitors at two locations, one in City and one in Mayfair, we cover a very broad spectrum of varying clients needs.
Rights As A Tenant In A Private Rented Property
A tenancy agreement sets out the rights and responsibilities between the landlord and tenants. In the unfortunate event where an issue arises then the tenants should refer to the tenancy agreement. Tenants have additional rights which are not always set out in the tenancy agreement. To give an example, the House in Multiple Occupation (HMO) licensing.
We have set out below the key points that tenants should be aware of when renting a property.
Additional fees
The Tenant Fees Act came into force on 1st June 2019 and the centre of this rule is that it prevents landlords from charging tenants with extortionate fees. The landlords are allowed to charge the tenants rent, tenancy deposit, and or a holding deposit.
Under the Tenant Fees Act, landlords are no longer allowed to charge tenants the cost of their own references or police checks, general administration fees, or cleaning fee. Landlords who charge fees that fall outside of the Tenant Fees Act may be liable to pay a fine of £5,000 however if the landlord repeats the breach, then this could lead to a criminal charge or a fine of £30,000.
However, the landlord can charge certain fees provided that it is written into the tenancy agreement, these are set out below:
- Late Rent Fees
Landlords can charge fees for rent payments that are due over two weeks. The fees can be charged up to 3% plus the Bank of England base interest rate.
- Default Fees
This includes the tenant losing a key or damaging the property. The tenant can only be charged a reasonable amount as long as the evidence of the cost can be provided.
- Changes to Tenancy Fees
Landlords can charge up to £50 for making changes to the terms of the tenancy agreement. This can include changing a tenant’s name or allowing a pet.
Disrepair
Under section 11 of the Landlord and Tenant Act 1985, landlords have the obligation to keep
the property in a habitable state for the tenants to reside in. This includes heating, hot water, access to power supply, water, etc.
These repair obligations cannot be changed by any terms written into the tenancy agreement and landlords cannot charge tenants for any repairs that fall under their mandatory obligations.
However, tenants would usually be responsible for the maintenance of the property. This includes the general upkeep such as changing the lights, unclogging sinks, gardening, and cleaning.
Should a tenant experience any disrepair issues such as mould, no heating, no hot water, etc then they should first report this to the landlord immediately.
If the landlord refuses to carry out the repair works then the tenant has various options available to them such as reporting to the local council and or issuing proceedings against the landlord.
House in Multiple Occupation License
The Housing Act regulations ruled that an HMO license is required for any house or flat that is occupied by five or more people who are not all related and live in the property as their main home. Landlords are therefore obliged to apply for a license application at the local council if the property needs licensing.
Ignoring the rules would result in the landlords paying a heavy price. There would be a risk of being prosecuted by the council and if found guilty landlords could get a criminal record, and be fined an unlimited amount. Alternatively, tenants can apply for a Rent Repayment Order and the landlord may have to repay up to 12 months of rental income.
Deposit
Deposits were collected as part of the renting process and landlords are obliged to pay the tenants’ deposits into a deposit protection scheme. This deposit protection was introduced on 6 April 2007 as part of the Housing Act 2004 and these protection schemes offer a free service to help resolve deposit disputes between the landlords and tenants.
When a deposit was not protected under a scheme and no further information was provided by the landlord, tenants can apply to the County Court for an order that the landlord returns the deposit back or protect it under one of the tenancy deposit protection schemes.
There are rules on what costs can be deducted from the deposit. And the landlord cannot, in general, charge for the costs of maintaining the wear and tear of the property. The usual costs can include deductions for (1) damage to the property and missing or broken items, (2) cleaning fees, and (3) unpaid rent or bills.
If tenants disagree with how the deposit is returned, or the tenant does not agree with some of the costs that landlords have taken out of it, tenants must ask the landlord for a breakdown of the specific costs which were taken out of the deposit.
In the case where an agreement could not be reached between the landlord and tenant, the parties can propose to use the free alternative dispute resolution service offered by the tenancy deposit scheme.
Under the alternative dispute resolution service, the parties are required to accept the decision made and will not be able to apply the decision to the courts. If on the contrary the landlord or tenant does not agree to use the dispute resolution service, then the dispute will usually go to the County Court.
If you require assistance in relation to private renting disputes, or you would like to learn more about the rights and obligations shared between landlords and tenants in private properties, please feel free to contact us and we can discuss and advise on your best way forward.
What do conveyancing solicitors do as the vendor’s solicitor?
A property transaction involves the buyer's solicitor and the vendor's solicitor, regardless a property is a second hand property, or new built or an off plan unit. We have talked about what a buyer's conveyancing solicitor do acting on behalf of the buyer previously. In today's article, we are focused on the vendor's solicitor's duties.
What do conveyancing solicitors do as the vendor’s solicitor?
The primary role of the seller's solicitor is to provide the information given to them about the property to the buyer's solicitor and support the seller in obtaining any additional information required. These are the main tasks a selling solicitor undertakes:
Draft contracts – Your solicitor drafts the initial legal contract with protocol forms (Property Information Form (TA6), Fixtures and Fittings Form (TA10), Leasehold Information Form (TA7) [Leasehold property only]) to be sent across to the buyer's solicitor.
Responding to enquiries – following the receipt of the draft contract, legal title and your property documents (as above) the sellers solicitor responds to any questions (also known as raising enquiries) the buyers solicitor may have (this is where you'll find out if you are missing documents which can cause delays to your sale). Documents which might be required from the buyers solicitor if relevant like planning permissions & Building Control for any extensions or under pinning, gas safety certificate, electrical certificate, FENSA certificates, asbestos removal certificates and EWS1.
Investigating issues – for some enquiries that can't be easily evidenced, the seller's solicitor needs to complete further investigation to try and satisfy them. The challenge here is if there is limited or no information to provide.
Exchange contracts – once the buyer's solicitor has satisfied their enquiries they agree with the seller to exchange contracts making the buyer legally bound to buy the property. Although buyers can still pull out, this can be financially costly (seller are entitle to rescind the contract and forfeit the deposit ad request any interest accordingly).
Completion – on the day of completion the seller's solicitor receives the money for the sale, discharges the mortgage (if required), pays the estate agent, deducts their fee and then sends the net sale proceeds to you.
Post completion – following completion the seller's solicitor receives the DS1 discharge documents and, when leasehold, settles the sellers liabilities for ground rent and service charges.
Chan Neill property solicitors understand that buying or selling a property can be a stressful time. Our team is well experienced and have stringent protocols in place to streamline the entire process efficiently, providing our clients with peace of mind. Across our team, we speak many languages including Mandarin and Cantonese, Gujarati, Russian, Portuguese, Korean and Spanish.
Chan Neill Solicitors is accredited under the The Law Society’s Conveyancing Scheme Qualification (CQS), which provides a recognition of our residential conveyancing standard and quality and is officially recognised by a range of mortgage lenders which grant us access to their residential mortgage lender panels.
If you have any enquiries regarding residential properties, commercial properties, buying or selling a property or properties owned by a limited company, please contact us. With access to our solicitors at two locations, one in City and one in Mayfair, we cover a very broad spectrum of varying clients needs.
How do I evict a tenant to regain possession of my property?
If there are tenants in your property and you need to evict because of rent arrears, nuisance or for personal reasons to move back in to the Property or to sell it. Chan Neill Solicitors are able to assist to regain possession of your property from preparing the relevant notice, and if necessary, issue possession proceedings, provide representation at court and instructing bailiffs.
The Procedure of the Eviction Process
Firstly, we will need to know what type of tenancy that you have with your tenant. In most cases, the tenancy is as assured shorthold tenancies. We would check whether the tenant is on a fixed term tenancy or periodic (rolling month to month)
There is a three stage process to evicting tenants:
- Notice
- Issue court proceedings to obtain an order for possession
- Bailiffs
1) Which Notice: Section 21 or Section 8 notice?
Subject to the type of tenancy that you have with your tenant and the reason you want to evict your tenant will depend upon which notice would be most suitable for your personal circumstances.
Whilst these notices are independent of each other and served for separate reasons, they provide the same result- we recover your property back.
Section 21 notice
Section 21 is a no fault basis whereby you are not compelled to provide reasons for eviction. A Section 21 notice is usually served when the tenancy is coming to the end of the fixed term or if the fixed term has expired (periodic tenancy).
There are a number of requirements that you must comply with first before a valid Section 21 notice can be served on the tenants, these are:
- An Energy Performance Certificate (EPC)
- How to Rent Booklet, this guide must be given to a tenant at the start of any new tenancy
- A Gas Safety Certificate
If a deposit was taken, then this must be protected within the requirement period. Failing to protect the deposit on time (within 30 days of receipt) will invalid the Section 21 notice.
A Section 21 cannot be served because the tenant has raised any housing disrepair issue.
The notice period for a Section 21 is 2 months.
Section 8 notice
A Section 8 notice is used where the tenant has breached the terms of the tenancy. The notice must state the grounds that you are seeking possession of the property. Landlords usually use the Section 8 procedure where a tenant is in rental arrears.
The notice period for Section 8 can be between 2 weeks to two months, depending on the terms of the tenancy / grounds.
2) Issuing Proceedings to obtain Possession order
In the event that the Tenant does not vacate the property after receipt of the notice, the next stage is to issue possession proceedings.
We can prepare the possession claim form on your behalf and issue it at the Court. Depending on which grounds you are seeking possession, we can then determine whether we can apply for possession via the accelerated route or the standard route for you.
3) BAILIFFS
If we are successful in obtaining an Order for Possession and the tenants still refuses to vacate the property, we can seek recovery of the property for you with the help of bailiffs.
Should you wish to discuss any of the matters talked about above or if you wish to look to instruct us, please contact us. Our team speak English, Mandarin, Cantonese, Spanish, Portuguese, Russian etc. Our offices are in Mayfair and the city should you wish to see us in person.
Considerations For Buying A Property Through Auction House
As well as traditional estate agents or developers selling in the United Kingdom, Auction House is one of the ways to buy and sell a property. Often smaller developers and individual investors in the UK are more keen on auctioning property, and there are often property auctions across the UK. During the pandemic has restricted offline home auctions, so online house auctions have sprung up virtually and attracted numerous investors.
Participating in a house auction requires the discernment to distinguish between the pros and cons. Some houses may seem cheap, but in fact they are layered with mines, and follow-up problems are continuous. However, looking at the positive side, there are also many buyers who can pick up a big bargain. At Chen Neill Solicitors, our experienced conveyancing solicitors suggest that if you want to buy a property through auction, you must do your homework in advance, including fully reading and studying the legal pack provided by the auctioneer, and be sure to conduct a site visit.
Recently, a client from Chen Neill Solicitors bid on a high-end property in London's zone 1, although the price of the auction was relatively cheap, the lease of the house was less than 10 years. In the space of two years, the seller of the property is already the third resale of the property, and the first two sellers have applied for an extension of leasehold and it was unsuccessful. The client agreed to buy the property without fully understanding the legal documents and without a detailed understanding of the lease of the property before bidding. The client encountered problems and could not regret it. Because the law stipulates that once the property at auction is decided to be auctioned, the buyer must purchase the property (Legally Binding), and the entire transaction process must be completed within 28 days.
In order to avoid the loss of buyers who are interested in participating in the house auction and buy the auction house of their choice at the right price, our property solicitors have summarised the following suggestions:
1． Read the legal package carefully
Auctioneers will generally provide buyers with a package of legal documents for the property before the auction begins – including title deeds, environmental investigation reports from local authorities, lists of fixtures and fittings, seller information sheets, and any rental information related to the property. The legal documents provided by auctioneers are quite important, and it is recommended that you ask a solicitor to take a closer look, as there may be hidden contractual terms or loopholes that only professionals can find, and these loopholes may cause you to pay more than your budget.
2． Field trips
Generally speaking, you can make an appointment to visit your property about a month before the auction starts. You can bring an experienced architect with you on your expedition to help you see some issues that you may not notice from a professional point of view. At the same time, if you have plans to renovate your house, the architect can also estimate the cost of a renovation. This way, you can take into account the cost of the renovation when bidding. You can also hire a chartered surveyor to measure and evaluate the property during the viewing, and some of the structural problems of the property itself cannot be viewed with the naked eye, and the appraisal report of the professional surveyor will play a great help when you measure the value of the property.
3． Funding provision
If you are prepared to buy in cash, it is recommended that you ask your conveyancer to check the source of funds in advance to ensure that the transaction is completed within 28 days of bidding. If you need to take out a mortgage to buy a property, you will need to discuss with your mortgage lender in advance to get the Mortgage in Principal. This way you know the maximum amount you can bid for at the auction. Please note that you only have 28 days (20 working days) to complete the transaction after the auction, and often the loan application takes more than 28 days, it is just as important to have the purchase funds ready in advance as the two factors mentioned earlier.
One final tip is to take out home insurance as once your offer has been accepted, you will be liable for any damage to the property until completion, it is advisable to take out an insurance policy to protect yourself in the event of any damage.
If you are interested in buying an auction property or need any legal advice on real estate, please contact our residential conveyancing team.
Why is Anti Money Laundering Check So Important?
On October 28 2021, the National Crime Agency (NCA) announced that they had filed civil claims against a Chinese mother and two sons in the name of suspected money laundering, and successfully asked them to hand over a London property worth 1.6 million pounds for compensation.
National Crime Agency (NCA) is a law enforcement agency in the UK. This agency is the UK’s leading agency in combating criminal groups. It mainly combats organised crime and economic crime, including human trafficking, weapons and drugs, cybercrime, as well as economic crime across regional and international borders etc.
A woman named Mrs Hajiyeva was previously investigated by The National Crime Agency, they issued her an "Unidentified Wealth Order" (UWO) and asked her to explain and prove the source of her large amount of funds. The lady was unable to explain the legal source of her funds, thus, the National Crime Agency confiscated her luxury house in London.
What is the "Unidentified Wealth Order" (UWO)?
UWO refers to "Unexplained Wealth Order", which is a court order issued by a British court to enable the target person to disclose the unknown source of wealth. The relevant requirement for issuing an "unknown wealth order" is that the court must be convinced that there are reasonable grounds to suspect that the target person's known legal source of income is insufficient to enable him/her to obtain such a large amount of funds. After the National Crime Bureau and other law enforcement agencies successfully appeal to the High Court, the assets of people who fail to explain the source of their wealth may be seized and bank accounts may be frozen.
We have discussed in a previous article that many students’ bank accounts were frozen by the National Crime Agency or Police in the name of suspected money laundering due to private currency exchanges. Therefore, we once again remind students studying in the UK to use private currency exchange services carefully and not to be involved in money laundering investigations which could affect their studies. If you want to learn more about what to do if your bank account is frozen because of private exchange, you can click here to view the article.
What is Anti-Money Laundering Regulations (AML)?
Anti-money laundering legislation is a piece of legislation aimed at illegal money laundering. Money laundering refers to the illegal act of converting illegally obtained funds into legal funds or concealing the illegal source of funds. The purpose of the anti-money laundering law is to prevent money laundering activities that conceal and conceal the proceeds of crimes, such as drug crimes, organised crimes, terrorist activities, smuggling crimes, corruption and bribery crimes etc., through various means.
The process of money laundering usually includes the following 3 stages:
- Placement: Put "dirty money" into the legal financial system while hiding its source.
- Layering: This step is also known as "structuring". It hides the source of funds through a series of transactions and accounting techniques, and breaks down the funds into small transactions, making money laundering activities difficult to detect.
- Integration: After the laundered money becomes legal funds, it is withdrawn from legal accounts and real records, and then large-scale consumption, investment, etc are carried out.
In the United Kingdom, companies must abide by anti-money laundering laws. The anti-money laundering regulations in the United Kingdom stipulate that all industries that involve large amounts of capital must take a series of measures to prevent their businesses from being used for money laundering or terrorist financing purposes. For example, in the gaming industry, the UK government imposes very strict supervision. For casinos and online gambling platforms that do not have due diligence to investigate the source of customer's funds, the UK gaming regulator - the UK Gambling Commission will enforce penalties.
- In April 2020, the UK Gambling Commission (UKGC) imposed a fine of £13 million on Caesars Entertainment (now acquired by Silver Point Capital), which is the largest regulatory fine in the UK. Caesars Entertainment was punished on the grounds that it allowed a VIP registered as a high-risk gambler to place bets without investigating the source of funds, and lost £795,000. It also failed to investigate the source of funds for a lady who claimed to be a waiter and allowed her to bet £87,000. Additionally, allowed a customer to transfer £3.5 million through the casino without investigating the source and destination of funds, etc. In addition to being punished with huge fines, three senior managers of Caesars Entertainment in the UK also had their personal licenses revoked.
- March 2021, the British Gaming Corporation (UKGC) fined online casino and sports betting operator Casumo with a fine of 6 million to the Gaming Commission for anti-money laundering defaults in the United Kingdom. The casino operator must investigate the client's funds. And Casumo caused at least 5 customers to lose a huge amount of gambling money without investigating the source of customer funds.
In addition to the gambling industry, the real estate industry also involves a large amount of funds in every transaction. Therefore, the British government also urges real estate agencies and real estate transaction lawyers to check every client's funds. Especially funds from abroad, including those from areas with frequent and high-risk terrorist activities and areas with more serious bribery.
At present, the UK's anti-money laundering laws are becoming more and more stringent for financial service providers. For example, banks will always check the source of any large sum of funds in your account. If you plan to buy a house in the UK, we recommend that you prepare relevant documents and materials in advance and cooperate with a conveyancing solicitor for checking your source of funds. At the same time, we also recommend that you contact your bank manager in advance to avoid the bank from misunderstanding the large amount of money you have transferred for house purchases, which may cause your account to freeze.
If you have any questions about buying a house, investing in the UK and AML investigations, please contact us. Our team speak English, Mandarin, Cantonese, Korean, Russian, Portuguese, Spanish etc.
Key Stages of a Purchase Transaction for Individual Purchaser
The following is a general guide to the key stages of a conveyancing transaction for an individual purchaser when buying a property:
- Instructing a Solicitor and Client Due Diligence
Once you have instructed a solicitor to act, you should receive a Letter of Engagement, which includes details such as agreed fees and scope of work. Your solicitor will then ask for monies on account to cover the cost of search fees and other disbursements.
Your solicitor is required to carry out proof of identity checks in compliance with the Anti-Money Laundering Regulations and will obtain the following documentation from you:
- Proof of Identity: Original or certified copy of your passport or UK driving licence;
- Proof of Address: Original or certified copy of your bank statements or utility bills (within the past 3 months); and
- Proof of Funding: Original or certified copy of your bank statements (full copy) showing the funds required for your purchase have been deposited in your bank account for at least 3 months in a UK bank account or 6 months in an overseas bank account.
You will need to inform your solicitor if you have a related sale and/or require mortgage finance for the purchase.
If you are buying with the assistance of a mortgage, you will need to provide details of your solicitors to your lender so that they send a copy of your mortgage offer to your solicitors.
You will also need to inform the Estate Agent the details of the solicitors you have instructed so that they can issue a “Memorandum of Sale” to all parties.
Your solicitors will then write to the Seller’s solicitors to confirm instructions and request the draft Contract pack. For leasehold properties, your solicitors will also usually request the Seller’s solicitors to provide the Sales Management pack from the Landlord or the Managing Agent.
- Searches and enquiries
Once the draft Contract pack has been received, your solicitor will review the documentations and instigate the appropriate searches. Please note that the turnaround time for searches may sometimes take more than 10 days depending on the Local Authority.
Your solicitor will raise any enquiries if necessary.
Your solicitor will also discuss a potential completion date as soon as there are no outstanding enquiries.
- Pre-exchange
Your solicitor will prepare a report on title for you outlining the details of the property and drawing your attention to any issues or information you should be aware of.
If you wish to proceed, your solicitor will invite you to sign the Contract together with any other documentation and to transfer the deposit monies (usually 10% of the purchase price) in readiness for exchange of contracts.
Your solicitor will also advise that you to obtain quotations for building insurance for the property as you will take on the risk from exchange of contracts, unless stated otherwise. Please bear in mind this is usually a must for lenders.
- Exchange of contracts
Your solicitor will proceed to exchange contracts as soon as they have received your original signed Contract and deposit.
At this stage, you will become legally obliged to purchase the property and the agreed completion date will become final. In the event that you fail to complete on the completion date, you will be liable under the Contract to pay interest and expenses incurred by the Seller. You may even lose your deposit if the delay continues.
- Pre-completion
Prior to completion, your solicitor will prepare a completion statement calculated up to the completion date. It is recommended that you transfer the completion funds to your solicitor at least 1 business day before completion to avoid any delays which may affect your ability to complete on the completion date.
Your solicitor will carry out all the necessary pre-completion searches.
You should arrange a pre-completion visit with the Seller or Estate Agent to ensure that the property is in an acceptable condition. If there are any issues at this point, you should notify your solicitors as soon as possible.
If you are buying the property with mortgage finance, your solicitor will submit a Certificate of Title to request drawdown funds from your lender. However, please note that most lenders will require a minimum of 5 working days’ notice for drawdown requests.
- Completion
On the day of completion, your solicitor will remit the completion funds to the Seller’s solicitors before the contract time which can vary from 12.30pm to 2pm and the Seller’s solicitors will notify your solicitor upon receipt. The Seller’s solicitors will then confirm completion and inform the Seller and/or the Estate Agent to release the keys to your new property to you.
Your solicitor will advise you when completion has taken place so that you can collect keys at the designated place, which is usually with the estate agents.
- Post-completion
Following completion, your solicitor will deal with post-completion formalities which includes paying any Stamp Duty Land Tax and lodge an application to the Land Registry to register your interest in the property. Please bear in mind that the Land Registry may take at least a few months to register your ownership of the property.
If the property being purchased is Leasehold, your solicitor will serve a Notice of Assignment to your Landlord and/or Managing Agents to ensure that your details are updated. Where you are mortgaging the property, then the Landlord or Managing Agents will need to be notified by way of a Notice of Charge.
In most cases, you are required to pay the fees for receipted notices mentioned above and any other compliance fees.
Once the registration at the Land Registry has been completed, your solicitor will forward you the registered title confirming your ownership of the property. If you purchased with assistance of a mortgage, your solicitor would send a copy of the registered title to your lender evidencing that their charge has been registered.