Conveyancing is the legal term used for the transfer of property from one person to another. There is a lot of work and five different stages involved in the buying and selling of property. If you are selling a property, you should first appoint your selling agent and solicitor. Preparation is key so early contact is advised.
Pre-contract state: It’s all about information!
The first stage in getting ready for a property transaction is the pre-contract stage. This is when you prepare your documents and get ready for the sale.
Sellers
In order to sell your property, you will need to get your title deeds. If you have a mortgage, your solicitor will need to request your title deeds from the banks. Your solicitor will need your permission and mortgage reference number to do this. Your solicitor will keep your title deeds for your bank and agree to repay all security loans out of the sale proceeds. However, the process retrieving your title deeds from the banks can take a number of weeks.
The type of property you are selling will determine the other information your solicitor needs. For example, if you are selling an apartment or house in a managed estate, there will be paperwork required from the management company. If you are selling a one-off house (an individual rural house outside a town or village) you will need to provide all grants of planning permissions, as well as certificates of compliance with planning, and building regulations for any work done to the house.
This part of the selling process is time-consuming so prioritise seeing your solicitor as soon as you decide to sell. This is particularly important if you are selling and using the money from that sale to buy another property. This is known as a chain and requires a lot of co-ordination between all people involved.
Buyers
If you are buying a property, then the pre-contract stage is all about having the necessary funds in place.
Your bank will require a lot of information before it issues a loan offer, including identification, payslips and savings. Your bank will issue a ‘loan pack’ to your solicitor. Your solicitor’s role is to ensure that the property you are buying has good marketable title. This means checking that the property is free from significant defects, disputes or claims. Solicitors can only determine the marketable title when they receive the contracts and a copy of the title documents and relevant information from a seller’s solicitor.
If you are buying a second-hand property, it is vital you have a survey carried out. This can take time to organise. Therefore, try and arrange a property surveyor as soon as you receive loan approval and your solicitor has received contracts.
Once your solicitor is happy with all documents, they will return your signed loan offer to your bank with their promise to carry out all the necessary legal work to put that property into your name. The solicitor will register the mortgage against the property, and you will sign the contracts to purchase your new home.
Signing contracts – Its binding!
The contract sets out the terms on which the seller is selling the property to the buyer. It includes the agreed price, the closing date and conditions relating to the sale as agreed between the buyer and seller. The buyer signs the contracts first and their solicitor sends the signed contracts to the seller’s solicitor along with the balance deposit.
Then the seller signs the contract and returns one part to the buyer’s solicitor. Once that is done there is a binding contract in place. Closing (finalising the sale) will usually take place 3-4 weeks after that unless the contract says otherwise.
A 10% deposit is required from the buyer when signing the contract. The buyer will have paid a booking deposit to the estate agent or auctioneer which will be used as part of the 10% deposit. This means the buyer will pay the remaining balance of the 10% deposit when returning signed contracts. It is important to plan for this and have those funds available.
Post contract
The solicitor for the seller will prepare all documents required for closing the sale (‘closing documents’). These are the documents that pass ownership of the property from the seller to the buyer. To do this, the seller will go to their solicitor to sign those closing documents. If needed, the seller’s solicitor will ask the bank how much money is left to pay on the mortgage and will use the proceeds of sale to pay the mortgage off as soon as the sale is done. The seller should make sure the annual Local Property Tax liability is fully paid up to date before finalising the sale. Proof of this will be required prior to closing.
The solicitor for the buyer will arrange to draw down the loan funds from the bank as soon as they are happy that all is in order to close with the seller. Remember - once funds are issued your loan has commenced and repayments will start as in your loan offer agreement.
Closing
The buyer’s solicitor will carry out all necessary closing searches for the seller and the property.
On the closing date, the closing documents will be exchanged for closing funds. Once the buyer’s solicitor confirms all is in order for the seller’s solicitor to release funds, the real estate agent will be notified that the sale is closed, and the keys can be released to the buyer.
After closing
Once the sale is closed, the buyer’s solicitor must make sure to register the Deed of Transfer with Revenue, pay the stamp duty and then register the buyer’s ownership and the mortgage with Tailte Éireann (previously known as the Land Registry). When your registration is complete your solicitor sends the title deeds of the property to the bank, and they will be held by that bank until the mortgage is paid in full or requested for sale again.
The seller’s solicitor must pay off the loan on the property and ensure that the registered mortgage is cleared off the title to the property and provide proof of this to the buyer’s solicitor.
And finally…
Remember in many instances properties are sold by other parties acting on behalf of the registered owner. This can include, for example, Legal Personal Representatives of deceased registered owners, Attorneys or Receivers.
The Law Society of Ireland and the Society of Chartered Surveyors of Ireland have produced a guide helping sellers to prepare selling their property and how to avoid common delays. The Speed up your property sale guide is available to download from the Law Society website here
Niamh Mahon is a partner with Mahon Sweeney solicitors in Roscommon. Niamh qualified as a solicitor in 2001 and has worked in general practice since qualification, specialising in Conveyancing, Probate and Litigation. Niamh has been a member of the Conveyancing Committee since 2022.
Disclaimer: Please note that this article is for general information purposes only and is not a substitute for legal advice. While every care has been taken in its production, no legal responsibility or liability is accepted warranted or implied.. Readers are advised to seek independent professional legal advice before buying/selling a property.
