The process of moving house can be tricky enough without all of the lawyer lingo which goes with it. If you don’t know your covenant from your contract or easement from your EPC, don’t worry.
We’ve put together some of the most commonly used terminology and lingo (in alphabetical order) to help you better understand all of the conveyancing chit chat you may come across with your home move.
Apportionments
When you are buying a flat, the seller will often have paid for Ground Rent and Service Charge up-front, and it’s likely you may be asked to pay your share of fees depending on when you move in. For example, if your seller has paid £50 Ground Rent up-front, which covers the period 1 July to 30 July and your purchase completes on 15 July, you are likely to be asked to pay the seller an ‘apportionment’ of £25 to cover your share of the Service Charge from 15 July to 30 July.
Caveat Emptor
A Latin phrase which means ‘let the buyer beware’. It is the buyer’s responsibility alone to check that they are happy with the physical condition of a property before they commit to exchange of contracts.
Chain
A sequence of linked sales and purchases.
Completion
This usually (but not always) happens a few days after exchange, and is the day on which the transaction goes through and keys are handed over.
Conservation Area
An area where there are some extra planning considerations and controls in place to protect the historic and architectural elements of the area.
Contract
The legally binding document by which the buyer agrees to buy the property, and the seller agrees to sell. The Contract usually includes the Law Society’s Standard Conditions of Sale and will set out the terms of the sale.
Conveyancing
The branch of specialised law which deals with the sale and purchase of properties.
Conveyancing Protocol
This is a guide which sets out the Law Society’s preferred practice for property transactions; many firms follow this protocol but not all of them.
Covenant
This is found within the title to a property and is an obligation affecting a homeowner, whether that’s a restriction e.g. using the house for businesses, or an obligation e.g. maintain a particular boundary
Deeds
This is a collective term generally used to describe all the legal documents associated with the ownership of a property. The deeds will demonstrate the seller’s ownership of the property, and also contain the details of any rights and covenants affecting the property.
Declaration of Trust
This is a document signed by the owners of a property that records who will get the sale proceeds and in what proportions when the property is sold. It is also known as a Deed of Trust and it’s something your solicitor should be able to draft for you.
Deposit
The sum of money payable by the buyer to the seller on Exchange of Contracts. The deposit is usually 10% of the purchase price but can be more or less depending on the sale, and your solicitor will ask you to transfer the deposit to them just before exchange.
Disbursements
These are various costs or expenses that your solicitor must pay out on your behalf, for example, Land Registry fees, or search fees.
Easement
A right enjoyed by one property over another, most typically a right of way.
Energy Performance Certificate (EPC)
A document which confirms how energy-efficient (or inefficient) a property is, and information on how to potentially improve different areas.
Exchange of Contracts
The point at which both buyer and seller become bound by the contract to complete the transaction on the agreed completion date, not to be confused with Completion.
Freehold
Outright ownership of the title to a property and the land that it’s built on, as opposed to Leasehold. You can learn more about what freehold means, and the difference vs leashold here.
Fittings and Contents Form
A standard form which is routinely completed by sellers at the outset of a sale to inform the buyers what is and isn’t included in the sale e.g. furniture/curtains etc
Ground Rent
Rent paid under the terms of a Lease by a leaseholder, for example in a flat. The ground rent would normally be paid to the freeholder i.e. the landlord of the property.
HM Revenue & Customs
The department of government responsible for the collective of taxes. In the vast majority of property purchases a Stamp Duty Land Tax return will need to be submitted to HM Revenue & Customs.
Indemnity Policy
An insurance policy usually taken out to offer protection to a buyer or their mortgage lender. For a one-off payment you get a policy that covers the cost implications of a third party making a claim against any defects with the property you are about to buy, such as where works have been carried out on the property without the necessary planning permission. The insurance premium only needs to be paid on a one off basis, usually on completion of the transaction.
Joint Tenants
A form of joint ownership where the co-owners do not own separate, distinct shares in the property. If one of the co-owners passes away, their share in the property automatically passes to the other co-owners, irrespective of the terms of their Will.
Landlord
Someone who grants a lease of their property to another party. Also referred to as a “Lessor”.
Lease
A document by which one party grants the right to occupy a property to another for a specified amount of time, for example if you’re renting out a flat from a landlord. The lease is usually in return for rent payments.
Leasehold Information Form
A standard form completed by the seller providing the buyer more information about the property.
Lessor
The party who grants a lease of their property to another party, also known as a Landlord.
Lessee
The party who is leasing the property.
Leasehold
A method of owning property (normally a flat) for a fixed term, but not the land on which it stands. It is the opposite of Freehold and is really a long-term tenancy giving a right to live in the property for a set number of years (the ‘term’) in return for payment of a lump sum, but can be bought and sold throughout that period. You can learn more about what it means to be leasehold, and the difference vs freehold here.
Listed Building
A property which is included on a list of buildings which are of architectural or historic interest. Listed building status may restrict any building alterations.
Management Company
Usually associated with a block of flats, the management company will manage and maintain the commonual parts of a building/area and collect Service Charge to fund this.
Managing Agents
A person or company appointed by the Landlord, or the Management Company, to manage and maintain the common parts of a building/area.
Mortgage
A loan secured against a property.
NHBC
National House Builders Council. This is a body that provides a 10 year warranty on the majority of new-build properties.
Off-Plan
When a new build property has not yet been built but it has already been purchased it has been bought ‘Off-Plan’.
Official Copies
Copies of the entries held by HM Land Registry which show the ownership of a property, and any matters affecting the property. Under the Land Registry’s system of registering land, Official Copies have now largely superseded the old paper deeds to properties.
Property Information Form (PIF or SPIF)
A standard form which is routinely completed by sellers to give the buyer more information about the property.
Protocol Forms
The collective name for the Property Information Form, Fittings and Contents Form, Leasehold Information Form, and other standard forms completed by the seller at the outset of a sale.
Registered Land
Land that is listed on a central register maintained by HM Land Registry, which includes the vast majority of land. The register shows ownership along with any matters affecting the property.
Rentcharge
A rentcharge is an annual sum paid by a freehold homeowner to a third party who normally has no other interest in the property. A rentcharge can also be referred to as a ‘chief rent’. ‘Rentowner’: a person who receives a rentcharge payment and has no other legal interests in the properties they collect from.
Searches
Enquiries your solicitor makes to various authorities to obtain more information about the property you are purchasing. The searches provide information which is in the public domain but would not be shown on the title. For example, the Environmental Search should flag up if the property has been built on land which was potentially contaminated, or if there is a flood risk. The Local Search will provide a wide range of information, including details of any Planning Permissions, and Building Regulations Approvals granted in respect of the property.
Service Charge
A payment collected by management company/managing agents which they use for the maintenance of the common parts of a building/area, usually with a block of flats.
Shared Ownership
A system by which a buyer can buy a share of the equity in a property, usually from a social housing provider e.g. Housing Association, and then pay rent on the share that they do not own. The buyer can then buy additional shares in the property: this is known as “staircasing”.
Stamp Duty Land Tax
A tax which must be paid to HM Revenue and Customs when purchasing a property in England, unless a relief applies, e.g. first time buyer relief. You can check the current SDLT threshold and reliefs on the Government website here (there is also a useful SDLT calculator).
Subject to Contract
A phrase used to state that until contracts are exchanged, nothing is legally binding for either parties involved.
Survey
A report carried out for a buyer by a surveyor to give them an insight into the physical condition of a property.
Tenancy-in-Common
A form of joint ownership, which differs from Joint Tenancy. With a Tenancy in Common, the co-owners own distinct shares in the property – this can be whichever split the co-owners agree on. If one of the co-owners passes away, their share of the property will not automatically pass to the other co-owner, it will pass in accordance with the terms of the deceased owner’s Will (or the ‘rules of intestacy’ if they did not have a Will).
Title
A term that refers to the legal basis of ownership of property. For example, the owner of a Freehold property owns the “Freehold title”.
Title Plan
A plan held by HM Land Registry which shows the boundary of the area of land in a registered estate.
Transfer Deed
The legal document by which ownership of a property passes from the seller to the buyer.
Unregistered Land
This only makes up a very small percentage of land in England & Wales, and refers to land that has not been registered at HM Land Registry. If the land you are purchasing is unregistered, although this won’t usually be a problem, it will likely be more work for your solicitor and you will have to pay a higher fee to HM Land Registry to register your purchase.
Vacant Possession
Essentially this refers to an empty property when it is handed over on the completion date, free from any occupiers or possessions that belonged to the previous owner.
Vendor
The seller of a property.
With all of this new terminology and lingo under your belt we hope you have a better understanding when moving home. However, if you still feel like you could do with an extra helping hand, remember that YouConvey customers are assigned their very own Home Mover Advisor who will talk you through every step of your home move and explain any tricky terminology you may come across.
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