Before purchasing a property in London, it is desirable to know the relevant procedure regarding a property for residential use in England. Below is a brief summary.
According to English law, property belongs to the Crown and an individual may be the holder of an interest in relation to the same, which confers certain rights upon him. The law acknowledges as interests freeholds and leaseholds.
Freehold is the broader, as its term is longer, given that it can last indefinitely, as long as there are individuals entitled.
Leasehold or lease has a limited duration that is fixed in precise and certain terms. In order to understand the institution in question, it must be underlined that leaseholder is not an assignee of the Crown, but of the so-called landlord. The lease has been defined as “grant of the right to exclusive possession of a property for a fixed period of time, shorter than that the assignor has on the same property”. This definition permits to identify the essential elements of the institution in question, which are the exclusive possession and the fixed term shorter than that of the predecessor in title.
Real estate sale procedure in the United Kingdom is different from the Italian one.
The main difference of the Italian system is that it is not compulsory to address themselves to a notary and, theoretically, it is also possible the so-called “do-it-yourself”, although no bank would grant a loan without the intervention of a solicitor.
In practice, in most transactions of real estate sale, the entire conveyancing process is managed by solicitors, generally one for the seller (Vendor’s Solicitor or Seller’s solicitor) and one for the buyer (Buyer’s solicitor).
The buyer deposits the whole necessary sum before the completion date on the account of his own solicitor; in the case of a loan, the borrowed sum is paid out directly on the account of the buyer’s solicitor.
The payment of levies must be made to the Inland Revenue together with the submission of a document containing all the details of the sale (Land transaction tax return) and authenticated by an attestation of payment; such document will then also be sent to the Land Registry to obtain the registration of property deeds in public registers.
In case that the property on sale is mortgaged, the solicitor shall agree with the buyer how to cancel the mortgage.
The Vendor’s Solicitor is liable to the bank that has granted the loan and has the duty to transfer the money needed for paying it off and preparing an appropriate document to cancel the mortgage (form of discharge).
Also in this case, as in that of the buyer, money transfers take place through the solicitor’s account.
The amount needed to cancel the mortgage is transferred to lender entity that will release a receipt, necessary to prove the cancellation of the mortgage to the Land Registry.