Property Conveyancing Archives

How an interest-only mortgage is repaid at term through equity release

Posted on 16 July 202429 March 2025 by Sarah O'Sullivan

Sarah’s interest-only mortgage has expired, and she has to repay the capital. In this scenario we see how she’s able to use the equity in her home to manage the repayment.*

Sarah Jones is a 65-year-old retired widow. Her residential interest-only mortgage has reached the end of its term, and she is now required to repay the capital sum of £80,000.

Based on her age and income, she could not qualify for a Retirement Interest Only (ROI) or residential mortgage, and her mortgage company is unwilling to extend the term any further. Also, she does not want to downsize.

By choosing a lifetime mortgage, Sarah is able to release the £80,000 from her home’s equity to pay off her mortgage. Payments are optional, but in the months when she has surplus cash, she may choose to make a payment to help reduce the interest roll-up.

Sarah’s lifetime mortgage allows her to retain home ownership while guaranteeing no negative equity.

Things to consider

Before applying for equity release, weighing alternative options and looking at the possible effects on your finances is important. These include:

Downsizing and other forms of finance
Compound interest roll-up if chosen
Early repayment charges
Long-term care and state benefits considerations
A lifetime mortgage may impact the inheritance you leave

Get in touch

Speak to our Wealth Specialist, Toni Chalmers-Smith or Senior Associate Solicitor Catherine Banks at Tees today.

*Examples of customer scenarios only. Every case will be different.

This material is intended for information purposes only and is not intended as an offer or solicitation for the purchase or sale of any financial instrument. It is not intended to provide and should not be relied on for accounting, legal or tax advice. Some information quoted was obtained from external sources we consider to be reliable.

Tees is a trading name of Tees Financial Limited, authorised and regulated by the Financial Conduct Authority. Its registered number is 211314.

Tees Financial Limited is registered in England and Wales, registered number 4342506.

UK Housing market mid-2024: Recovery amid challenges

Posted on 28 June 202413 May 2025 by Sarah O'Sullivan

Residential property review June 2024 – The UK housing market continues to show modest signs of recovery, according to the latest data from Savills.

Despite some house price growth, a significant upturn is unlikely until mortgage affordability improves.

Buyer activity continues to improve, as the number of sales agreed in May was 10% higher than the 2017-2019 average, according to TwentyCI.

The rental market remains relatively consistent. Data from Zoopla shows that, in April, annual UK rental growth was 6.6% – slightly lower than the 6.7% recorded in the previous month. The region with the strongest annual growth was the North East (9.5%), followed by Scotland (9.3%). Rental growth is accelerating in locations close to large cities, such as North Tyneside and Midlothian – more evidence that the pandemic’s ‘race for space’ appears reversed.

New homes in the capital – demand outstrips supply

Demand for new buildings in the capital is increasing, but supply is limited due to high development costs.

Knight Frank data indicates confidence is picking up among London buyers. In April, the number of offers placed on new homes increased 9% year-on-year, while viewings rose 17%. Similarly, for mid-to-upper markets, the number of prospective buyers interested in purchasing a new build was 15 to 20% higher than the previous year.

Despite this growing demand, building costs in the capital have put off some developers. As a result, new starts fell by 20% over a 12-month period, and about 35,000 new homes are being delivered per year – over 30% lower than the Mayor of London’s target of 52,500.

How will the General Election affect the housing market?

Ahead of the 2024 General Election, new homes are the unanimous focus of the manifestos regarding housing.

If the Conservatives remain in government, Rishi Sunak aims to build 1.6 million new homes over the next five years – slightly more than the Labour Party’s target of 1.5 million and less than the Liberal Democrat’s promise of 380,000 new builds per year. Ed Davey stated that 150,000 will be social housing; Keir Starmer prioritises building new social rented homes.

The Labour, Liberal Democrat and Conservative manifestos pledge to fully abolish Section 21 ‘no fault’ evictions. Davey also pledged to create a national register of licensed landlords and make three-year tenancies the default.

If the Labour Party comes to power, they propose increasing the Stamp Duty rate for non-UK residents. Meanwhile, the Conservatives would abolish Stamp Duty for first-time buyers (FTBs) on homes up to £425,000. To further support FTBs, Sunak promised a new and improved Help-to-Buy scheme. Similarly, the Labour manifesto pledged a permanent mortgage guarantee scheme.

All details are correct at the time of writing (19 June 2024)

It is important to take professional advice before making any decision relating to your personal finances. Information within this document is based on our current understanding and can be subject to change without notice, and the accuracy and completeness of the information cannot be guaranteed. It does not provide individually tailored investment advice and is for guidance only. Some rules may vary in different parts of the UK. We cannot assume legal liability for any errors or omissions it might contain. Levels and bases of, and reliefs from, taxation are those currently applied or proposed and are subject to change; their value depends on the investor’s individual circumstances. No part of this document may be reproduced without prior permission.

Understanding retirement village purchases

Posted on 25 April 202426 March 2025 by Sarah O'Sullivan

Are you contemplating purchasing a property in a retirement village? It’s crucial to comprehend the distinct elements of this type of property acquisition. In this guide, we will delve into the key considerations, financial implications, and legal matters to consider when purchasing in a retirement village.

What to consider when purchasing in a retirement Village

When it comes to the purchase of a property in a retirement village, there are several crucial considerations to bear in mind. These factors can significantly influence your lifestyle and overall contentment with your new home. The most significant aspects to consider are:

Location and accessibility: The situation of the retirement village is vital. Consider the proximity to amenities such as shops, medical facilities, and public transport. You may also wish to ponder the distance to family and friends, as well as any desired recreational activities in the vicinity.

Facilities and amenities: Retirement villages often offer a variety of facilities and amenities to enhance your daily living. These may encompass communal areas, fitness centres, swimming pools, gardens, and more. Take the opportunity to evaluate the available amenities and ensure they align with your interests and lifestyle.

Community and social aspects: One of the main attractions of retirement villages is the sense of community they foster. Consider the social aspects offered, such as organised activities, clubs, and events. It’s crucial to find a retirement village where you can connect with like-minded individuals and cultivate meaningful relationships.

What are the financial implications of purchasing in a retirement village?

Having a comprehensive understanding of the financial aspects involved will enable you to make informed decisions and ensure you are adequately prepared.

The costs may vary depending on the location and facilities offered by the village but can include:

the purchase price of the property,
legal fees, stamp duty, search fees
Service charges cover the upkeep and management of the communal areas and facilities. (It is advisable to review the service charge breakdown and consider any potential increases in the future.)
additional charges for amenities such as parking

Consult with our specialist solicitors who understand retirement village acquisitions to understand these costs fully.

Resale value is also a significant consideration when purchasing in a retirement village. Understanding the factors that can influence the resale value of your property can assist you in making a wise investment. Factors such as location, amenities, and the reputation of the retirement village can all influence the resale value. It is advisable to seek expert advice from estate agents specialising in retirement properties to gain insight into the resale potential of the village you are considering.

What are the legal aspects of purchasing in a Retirement Village?

There are three key legal aspects that you should be aware of:

Lease restrictions: These restrictions can vary depending on the specific village and its management. Our legal team can review the lease agreement and ensure you are fully aware of any limitations or obligations.

Conveyancing costs: Conveyancing is the legal process of transferring ownership of a property from the seller to the buyer. It involves various fees, including – solicitors’ conveyancing fees and any disbursement (i.e. third-party payments such as stamp duty, searches, bank transfer fees, land registry fees, payment for service charges to the Management Company or ground rent, if lease involved and also notice fees).

Inheritance and succession planning: It’s crucial to have a well-drafted will in place to ensure your wishes regarding the inheritance of your property are carried out. Additionally, you may wish to consider establishing a trust or making arrangements for any potential care needs in the future.

Purchasing in a retirement village can offer a range of benefits, including a sense of community and convenient amenities. However, it’s crucial to carefully balance these advantages against potential drawbacks, such as financial commitments and lifestyle restrictions. Take your time to read and understand the legal documentation associated with the purchase. If you have any questions or concerns, don’t hesitate to ask for clarification.

Be proactive in your communication with the retirement village management and stay informed about any updates or changes that may impact your purchase.

Exploring alternative options is also recommended to ensure you make the best decision for your retirement years.

What are the alternatives?

Retirement villages are not the only choice for retirees. Some individuals may find the structured nature of retirement village living restrictive. It’s important to consider whether you prefer a more independent lifestyle or if you would thrive in a community environment with rules and regulations.

Other alternatives include:

downsizing to a smaller home,
moving in with family,
or exploring assisted living facilities.

Each option has its pros and cons, and it’s vital to consider what suits your personal preferences and needs.

At Tees, our expert team of legal and financial advisers can help support you to make the best decision for you and your family. Contact us today to discuss your retirement village property acquisition.

Shared ownership home: What does ‘staircasing’ mean?

Posted on 20 December 202327 March 2025 by Sarah O'Sullivan

If you live in a shared ownership home, you might have considered buying additional shares in your property. This process is known as staircasing.

What is staircasing?

Staircasing is when you purchase more shares of your shared ownership property, gradually increasing your ownership percentage. As outlined in your lease, you have the option to buy further shares, which means:

Greater ownership: You own a larger portion of your home.
Lower rent: You pay less rent on the shares you don’t own.
Full ownership potential: Most shared ownership properties allow you to eventually staircase to 100%, becoming the sole owner.

To find out if your property allows full staircasing, check your lease or speak with your landlord.

Benefits of staircasing

When you staircase to 100% ownership, you’ll no longer pay rent. You will still need to cover your mortgage, but securing a standard mortgage rate may become easier, compared to a shared ownership mortgage.

How Does Staircasing Work?

Let’s say you initially bought a 30% share of your home. Later, you decide to buy an additional 20%. You would then own 50% of your property.

Interim staircasing: This refers to any partial share purchases (e.g., going from 30% to 50%).
Final staircasing: If you staircase to 100%, you become the sole owner.

Are there any restrictions?

Some properties have restrictions on staircasing due to planning permissions. This is often to ensure homes remain available for local people rather than becoming second homes. Check your lease or consult your landlord to understand any limitations.

Do you have to staircase?

No, staircasing is completely optional. It’s a great choice if your financial situation improves and you want to invest more in your home. However, it’s not a requirement.

Costs to consider

Staircasing does come with additional costs, including:

Property valuation: A surveyor will determine your home’s current market value.
Legal fees: You’ll need a solicitor to handle the legal process.
Stamp duty: Depending on how much you staircase, you may need to pay Stamp Duty.

Financing your staircasing

If you don’t have sufficient savings, you can consider remortgaging to release funds and extend your mortgage term. Many lenders offer options to help finance additional share purchases.

Final thoughts

Staircasing can be a great way to increase your property ownership and reduce rent payments. To explore your options further, review your lease, speak to your landlord, and seek professional financial and legal advice.

If you have any questions, contact our conveyancing team today.

Shared ownership homes: Repairs and home improvements

Posted on 2 December 202326 March 2025 by Sarah O'Sullivan

If you’re considering a shared ownership property, one of the most common questions is: Who is responsible for repairs and home improvements? Understanding your responsibilities can help you budget effectively and avoid any unexpected surprises.

What is shared ownership?

Shared ownership allows you to buy a percentage share of a property while paying rent on the remaining share, typically owned by a housing association or landlord. While this offers a more affordable route to homeownership, it also comes with specific responsibilities for repairs and improvements.

Who handles repairs and improvements?

Structural changes and home improvements

While you’re free to decorate and make minor cosmetic changes, any significant structural changes require approval from your landlord. This is because structural modifications can impact the property’s market value, which may affect the price if you decide to staircase (buy additional shares).

Keep in mind that a landlord is not responsible for upgrades like a new kitchen or bathroom if your motivation is purely aesthetic.

Initial repair period

Some shared ownership properties come with an initial repair period, typically lasting up to 10 years. This applies if you own less than 100% of the property.

During the initial repair period:

The landlord covers essential repairs but cannot use the reserve fund or service charges to pay for them.
You are still responsible for paying your service charges as usual.
You may be able to claim up to £500 per year from your landlord for certain repairs, including issues with water, gas, electricity, or heating systems.

You can check whether your property has an initial repair period by referring to the Key Information Document provided by your landlord before you reserve the home.

External and structural repairs

For new-build homes, external and structural repairs are usually covered by a building warranty for the first 10-12 years. If you purchase a shared ownership resale property, any remaining warranty period will transfer to you.

For flats, external repairs are typically the responsibility of the freeholder or building owner. The cost is then divided among all flat owners through your service charge.

What to Do if Repairs Are Needed

If an issue arises, contact your landlord as soon as possible. They will assess the problem and determine whether the repair is essential. Keeping clear records of all communications and repair requests can be helpful.

For further information, visit the government website for official guidelines.

By understanding your responsibilities, you can enjoy the benefits of shared ownership without unexpected repair costs.

Shared ownership: How to get on the housing ladder

Posted on 2 October 202326 March 2025 by Sarah O'Sullivan

Shared ownership can be a way of getting onto the housing ladder for many people. But, there are a few things you should consider first.

What is shared ownership?

Shared Ownership is a form of affordable housing. The term ‘shared ownership’ encompasses schemes where a registered social housing provider grants a lease of a percentage share of the property and rents the remaining percentage to the tenant. Shared ownership homes are offered by housing associations, local councils, and other organisations. They are called ‘providers’ or the landlords.

From a conveyancing perspective, the transaction is still dealt with by solicitors, and the usual conveyancing and mortgage costs are still payable when you opt for a shared ownership purchase.

Who is eligible?

You are only eligible to purchase a shared ownership property if you meet certain criteria. The government sets this criteria:-

You can buy a shared ownership if both of these apply:-

your household income is £80,000 a year or less (£90,000 a year or less in London)
you cannot afford all of the deposit and mortgage payments for a home that meets your needs

0ne of the following must also be true:

you’re a first-time buyer
you used to own a home but cannot afford to buy one now
you’re forming a new household – for example, after a relationship breakdown
you’re an existing shared owner, and you want to move
you own a home and want to move but cannot afford a new home that meets your needs

For some homes, you may have to show that you live in, work in, or have a connection to the area where you want to buy the home.

There are also some other specialist Shared Ownership schemes for people who:-

are members of the Armed Forces
are over 55 years old
a person with a long term disability

More can be found on the Shared ownership homes: buying, improving and selling: Who can apply – GOV.UK

Buying a shared ownership property

All shared ownership property, whether it is a house or a flat will be leasehold. The Provider will own the freehold interest in the property and will grant you a lease. A shared ownership lease will specify that you own a given percentage, which will be the share you agreed to purchase. The purchase price you pay will be a percentage of the market value which corresponds with the share you will receive. You can either have a brand new lease granted on a new build property or be assigned an existing lease on an older property.

The lease will usually contain a provision which will allow you to buy additional shares throughout the term as and when you are able until eventually you own 100%. This is known as “staircasing”. You should note however that not all leases allow you to staircase and those that do may not allow you to staircase to the full 100%.

Initial ownership can start at 10% ownership, but usually, a lease is offered with a share of 25%, 50% or 75% of the value of the property. This can be paid for with a mortgage or from savings. As with a usual transaction, a deposit will be required which is usually 10% of the purchase price of the share.

The remaining share is then rented from the Provider for an affordable rent. Your monthly outgoings may include a mortgage payment and rent but will be much lower than the mortgage costs if you were to buy outright. When you can afford to, you may be able to increase your ownership of the property by staircasing. This can also be from either savings or a further advance on a mortgage.

Example:-

If the market value is £150,000.00 and you agree to buy 25%, the price you pay will be £37,500.00. You will then pay rent, known as “specified rent”, on the remaining 75% share.

Staircasing

Once you have purchased the initial share of property you can choose to increase your share, if your lease allows.

The amount you can staircase by is dependent on what your lease says and its age.

If you are looking to buy more shares, you will still require a solicitor to do this. You will also require a valuation so that the additional share is calculated based on the current value of the property. Please get in touch with one of our property specialists as they can assist with interim staircasing and final staircasing.

Will I have to pay stamp duty land tax?

Yes, the tax will be payable, however, the amount is dependent on a couple of factors: –

If you are buying a new build property and you are the first owner, you have a choice to either pay Stamp Duty Land Tax on the share that you are buying or you can elect to pay the tax on the full market value of the property
If you are buying an existing shared ownership (an assignment) then you can only pay the tax on the amount that you are acquiring.

The provisions for stamp duty on shared ownership properties are complex and we suggest you contact us for specific advice on your particular transaction.

What is a maintenance charge?

In common with most leasehold properties, you will be obliged to pay a share of the landlord’s expenditure incurred in satisfying its obligations under the lease. The type of obligations varies depending on the type of property you are buying:-

For a flat this may include, cleaning and lighting communal areas, building insurance, external decoration and structural repairs all of which you will share with other leaseholders.
In the case of a house, this can include building insurance and sometimes the cost of maintaining any common areas of an estate.

These costs are usually collected with the rental portion of the payments that you make to the Provider.

Can I let the property?

It is not usually possible to let a shared ownership property though once you have staircased to 100% this may be an option. This will be specified in the Lease.

Selling a shared ownership property

If you have bought the house outright you are free to sell the property as you wish but your landlord is usually entitled to buy back the property so that it can be offered to other families who seek low-cost shared ownership. They are obliged to pay you the full market price for the property.

If you only own a share of the property your landlord may require that you sell that share to a household nominated by them or to the landlord themselves, again for the full market price.

You may find that a shared ownership property is more difficult to sell than a ‘normal’ property as the pool of buyers is smaller because not everyone will meet the required criteria. However, the provider may also have a waiting list of potential purchasers.

The lease with have instructions on what to do when you wish to sell the property. This usually entails:-

Telling the landlord you wish to sell
The landlord will try and find a buyer for you within what is called the nomination period. This can be from 4 to 12 weeks.
If the landlord doesn’t want to buy the property or can’t find a buyer for you in the nomination period, you are then allowed to sell on the open market. You can either offer this as the share you bought or sell the whole property.

What other things should I consider?

A shared ownership lease is seen to be a tenancy agreement rather than a long lease until it has been staircased to 100%. Terminating a tenancy is much simpler than forfeiting a lease since all the landlord has to do is prove that the rent is in 3 months’ arrears. It is therefore important to note that you are at serious risk if you do not keep up with your rental payments.

You will need to get a specialist shared ownership mortgage if you are using one to assist with your purchase.

There are some additional costs to consider when selling, these can include:-

Paying for the landlord’s valuation costs
Paying for the landlord’s legal fees
Paying a nomination fee, if the landlord finds a buyer for you in the nomination period.

If you want to purchase a shared ownership property, please do not hesitate to get in touch, for bespoke advice.

We are members of the Law Society Conveyancing Quality Scheme.

Guide to buying new build homes

Posted on 25 July 202326 March 2025 by Sarah O'Sullivan

Buying a property is an exciting time and buying a new build property can be even more exciting as you are buying a blank canvas, with all new fittings – which you may be able to customise. However, buying a new build property is more complex than buying an existing property, with a lot more that needs to be considered. Here our conveyancing expert Marie Rodgers, sets out what you need to know.

What is a new build home?

A ‘new build’ is defined most usually as a property that was built, converted or refurbished within the last two years. People most commonly think of new build as totally new houses – those which are being bought ‘off-plan’. An ‘off-plan’ property is one that is yet to be built; it may be part-way through construction or not yet begun. The sale details for an off-plan property will comprise floorplans, working drawings and computer-generated images instead of photos, to see what the finished product will look like. However, ‘new build’ also includes properties that have been occupied or rented before, but are still owned by the builder or developer.

Reservation fee for new builds

When you agree to purchase a new build, the developer will ‘reserve’ this plot for you in return for paying a ‘reservation fee’. The amount of this fee can vary depending upon the property and development but usually varies between £500-£2,000. This forms part of the agreed purchase price and is deducted from the balance which you pay for the property on completion. It’s important that you check your reservation agreement carefully in order to work out whether this reservation fee is refundable in the event you do not proceed with the purchase of your plot.

Exchange deadline

A key difference with new builds is that the developer will impose a deadline by which an exchange of contracts must take place. This is usually 28 days. This means that the process will move at a very fast pace and it’s therefore important that you instruct a conveyancer quickly. Also make sure you act quickly upon their instructions as to what they require to progress your purchase. In the event the exchange deadline is not met, the developer reserves the right to re-market the plot, so you could lose the property.

Extras might incur more Stamp Duty Land Tax (SDLT)

One of the benefits of buying a new build property is that you have the ability to customise the property by paying for ‘extras’. Examples of the types of extras you might be able to choose from are upgraded kitchen appliances such as cooker hob, integrated fridge freezer and dishwasher, better kitchen units, better quality floor tiles, bespoke fitted wardrobes and even things for the garden such as turfing and an outside tap.

However, these additional extras may incur SDLT in their own right so it’s best to check this point with an expert. At Tees, we can refer you to a stamp duty specialist who can accurately calculate the correct SDLT you should be paying for your property.

Know exactly what you’re buying in your new build home

The marketing people will show you lots of printed materials and maybe videos to encourage you to buy but these may not show exactly what you will be buying. Your plot could be in a different location on the development site, closer to roads, recreation grounds, with different lights etc. Another thing to be certain of is the precise spec for your new home. You need to know what fixtures and fittings there will be and what building materials will be used throughout the property. Make sure you know what has and hasn’t been included in the total cost so you don’t have a problem later on.

Complex documentation

New build conveyancing is much more complex than that for an existing property. Your conveyancer will be processing a vast amount of additional documentation which comes with purchasing a new build home. They will need to ensure that the necessary planning and building regulation approvals are in place for the development and appropriate provisions are in place for the construction of the roads and sewers on the estate. They will also need to ensure that you have the necessary rights to use these roads and sewers. It’s therefore important that you instruct a conveyancer with knowledge and experience in new build conveyancing who will be able to guide you through the process and identify any issues should they arise.

Mortgage offers on new build homes

Due to the short timescales in which you have to exchange contracts, it’s important that you obtain a mortgage offer as soon as possible. You will need to make sure you have a valid mortgage offer in place before an exchange of contracts. Your conveyancer will also need to ensure that any conditions contained within this offer have been complied with and that the lender is happy to proceed.

If your property is not yet built when you exchange contracts, it’s possible that your mortgage offer may expire before you get to move into your new home. In this instance, you should speak to your mortgage broker or lender directly, in order to ensure that your offer can be extended, or a new offer obtained, should it be required. You should bear in mind that if a mortgage extension or new mortgage offer is required prior to completion, any new product or interest rate attached to the mortgage, may not be as good as the original mortgage offer issued.

Dates for completion

When you exchange contracts on a new build property, if the build is not complete, then a ‘fixed’ date cannot be agreed for completion. Instead, the developer will provide you with an ‘estimated’ date for completion. This is the developer’s best estimate for when the property will be completed based upon their forecasts. Unfortunately, factors may delay the build which are outside of the developers’ control. At Tees, we will always ensure that there is a ‘termination’ (often referred to as a ‘longstop’) date in the contract. This is the final date by which the developer has to complete the build of your property, failing which, you can terminate the contract and have your deposit and reservation fee returned to you.

Annual maintenance charge

A new property often forms part of a larger development and will involve the use of shared common areas, such as green spaces or play areas, shared accesses, or private roads. The costs for any upkeep and maintenance for these areas will be payable by the individual property owners by way of an annual maintenance charge. The amount of this charge will vary depending on the development. You should discuss this directly with the site office at the development before reserving your plot so that you are fully aware of the ongoing maintenance charges for which you will be liable.

Structural warranty

Your property will be sold with the benefit of a 10-year structural warranty. Your conveyancer will ensure your warranty is in place upon completion and provide you with a copy of the necessary documentation which you will need in the event you ever need to make a claim in future or sell the property. They will also check with your lender in order to ensure that they are happy with the warranty which is being provided.

Do I need a snagging list for my new build home?

It’s common to find defects that require rectifying. They could be relatively small issues such as poor quality paintwork or a hinge that is broken or more major issues such as a leaking pipe. The developer should check everything, but nothing is foolproof so you need to create a list of what needs doing – a snagging list. Make time to walk through the whole house systematically to check for marks, scratches, and things which are broken. You can check floors and surfaces are level and whether everything works properly. Make sure there are no leaks from any taps.

You are not able to delay moving into your property for any snagging works which may be required. At Tees, we advise that you inspect your property before moving in, once it is completed, in order to check the finish and ensure that no major works remain outstanding.

However, it may not be possible to do it before you complete if the housebuilder won’t give you access. If you do it after you move in, don’t wait too long, in case the housebuilder tries to say you caused the damage yourself. However, you do have two years from your completion date to report any defects to your housebuilder which they have to rectify as part of your property’s warranty. At Tees, we will ensure you are aware of your rights to get snags fixed and ensure there is an obligation on the developer to carry out these works. If a dispute arises, we have expert property litigation solicitors at Tees.

At Tees, our conveyancing experts have a wealth of knowledge and experience in the world of new build conveyancing and so are best placed to guide you through every step of the way, from initial instruction to completion.

Release equity from house: Increase your income

Posted on 3 July 202313 May 2025 by Sarah O'Sullivan

As we’ll explain in this article, equity release is just one of several options that are now available to over 55s who wish to increase their income. Here at Tees our Equity Release Council member and SOLLA accredited experts are on hand to help and advise you every step of the way.

We’re all living longer and often, retiring later.

Changes to the state pension age, along with anticipated shortfalls in many private pensions, mean that we’re likely to need to look to alternative solutions as to how to fund our lifestyles in or approaching retirement – or risk relying on debt in later life.

In the past five years, the total value of debt held by the over-55s is estimated to have increased by 47 per cent and in another five years, this total value is forecast to increase by 35 per cent, rising to £397bn by 2024.

The good news is that the options to increase your income in later life are growing, becoming much more attractive – and can offer you peace of mind.

Since the government introduced pension reforms in 2015, the financial services industry as a whole – including the mortgage market – has begun to catch up with the challenges and opportunities of social change and consequently, lending criteria relating to age and retirement status have become a good deal more flexible.

Only a few years ago, there might have been a small handful of building societies prepared to lend to people of older age, however today, the options are many and varied and the previously niche equity release market has seen rapid growth and development into an industry that is now more commonly referred to as the later life lending market.

It is estimated that the UK’s over-55s currently own £1trillion in housing wealth.

What is later life lending?

Put simply, it is a mortgage offered to the over 55s that is designed to let you make use of the money that’s built up in your home and help you live better in your retirement.

What are the different types of later life lending?

Lifetime Mortgage

This is a form of equity release that lets you unlock the value in your home as a tax free lump sum of money.

How does equity release work?

Equity release is essentially like a long term loan. However, you don’t have to make monthly payments, unless you choose to, and the loan is usually repaid when the last borrower moves into long term care or dies, and you keep full ownership of the property. The maximum loan amount depends on your age and how much your property is worth.

Equity release may not be right for everyone. It may affect your entitlement to state benefits and will reduce the value of your estate.

Retirement Interest Only (RIO) Mortgage

A retirement interest only mortgage is very similar to a standard interest only mortgage, but with some differences.

The main part of the loan (capital) is usually only paid off when the last borrower moves into long term care or dies and you only have to prove you can afford the monthly interest payments.

Retirement Capital & Interest (RCI) Mortgage

Much like a standard repayment mortgage you pay back both interest and capital on a monthly basis.

The main difference is that you can borrow up to a higher age than on a standard mortgage but the product is still designed to repay your mortgage in full by the end of your term.

You’ll need to be able to afford the repayments on a monthly basis.

Home Reversion Plan

A Home Reversion Plan allows you to access all or part of the value of your property while retaining the right to remain in your property, rent free, for the rest of your life.

The plan provider will purchase all or part of your house taking into account your age and your health and will provide you with a tax free cash lump sum (or regular payments) and a lifetime lease, guaranteeing you the right to stay in your property rent-free for the rest of your life.

Is borrowing in later life right for me?

It’s often a good idea to speak with family members or trusted friends before taking on further borrowing in later life, they can often offer support and suggest other ways you could raise money. Borrowing in later life can have an impact on inheritance amounts you leave and any state benefits or local authority grants you get.

Is it wise with increasing interest rates for parents to release equity to assist in paying off or reducing their children’s mortgages?

This is a complex decision and will depend on various factors, here are some considerations:

Helping your children may be beneficial if you have excess funds and you are in a financially stable situation. It’s important to ensure that you have enough savings for your own needs and emergencies before considering assisting your children with their mortgages.
Releasing equity from your home may affect your retirement plans. It’s crucial to evaluate how using this equity will impact your future financial security, as you may be reducing the value of your estate or limiting your access to funds in the long term.
Before considering equity release, explore other possibilities for helping your children with their mortgages. For instance, you could recommend they seek financial advice or explore other forms of financial support that may not have long-term consequences for your own financial situation.
While helping your children reduce their mortgage loan can be beneficial, it’s essential to involve them in the decision-making process. Make sure they understand the implications and responsibilities associated with receiving financial assistance.
Releasing equity from your home may have tax implications, such as potential inheritance tax considerations.
Releasing equity may reduce your financial flexibility. Consider whether you may need access to the equity in the future for other purposes, such as long-term care costs or other unforeseen circumstances.

Ultimately, the decision to release equity to assist your children with their mortgages depends on your financial circumstances, risk tolerance, and long-term goals. It’s advisable to seek advice from a qualified financial adviser who specialises in this area of advice or a mortgage specialist who can provide personalised help and guidance on your specific situation.

Can I apply for a later life mortgage?

Many lenders will consider applications from people aged 55 up until their 85th birthday, with some lenders offering existing customers a mortgage up to their 95th birthday.

What can the money be used for?

The money released can be used for lots of different things. Some common uses include home improvements, family gifts, funding the purchase of a further property, buying a car, travelling abroad, or funding care.

Example

Mrs Hurst needed to carry out improvements on her home and gift her daughter money to aid her in buying a house. At the time, she held a lifetime mortgage previously arranged with another lender at an uncompetitive rate of 7.19%.

In order to achieve her goals, Mrs Hurst required an urgent loan of £226,160 and a more competitive rate of interest than her existing lifetime mortgage.

Tees’ Solution

Utilising a ‘whole of market’ approach, a new Lifetime Mortgage product was secured for Mrs Hurst, offering a significantly lower rate of interest of 3.92%.

As well as releasing an initial loan, Mrs Hurst released an additional £32,665 in order to fund the necessary £25,000 for home improvements and £10,000 to aid her daughter’s home purchase.

Even though the transaction involved releasing additional equity from her home, the lower rate of interest that was secured for Mrs Hurst on her new Lifetime Mortgage arrangement has resulted in a total saving of £256,049 of mortgage interest payments over a 15 year period, compared with if she had remained with her previous lender.

Outcome

The savings we secured for Mrs Hurst means she is now more able to enjoy a more comfortable retirement.

Our clients come to us for many different reasons. One of these is we offer lenders from the whole market and are able to access low rates. This ensures our clients can enjoy their retirement to the fullest and get the most out of the value of their home.

The Tees difference: a bespoke service that’s focussed on delivering what you really need

Toni Chalmers-Smith is a later life lending specialist at Tees who has worked in the financial services industry for over 25 years. While fully qualified in all forms of life, health, mortgage and pension business, Toni is expert in advising clients who require later years advice, which includes investments, inheritance tax and estate planning, equity release and care fees planning. Toni works closely with Tees’ legal advisers in providing specialist advice on all areas of later life lending and also offers older clients a financial review and support service, especially if an individual or family member is unable to cope with day to day financial decisions.

Catherine Banks is an experienced solicitor in Tees’ residential conveyancing team, and specialises in later life lending conveyancing. Together Toni, Catherine and the rest of the Tees team work seamlessly together to ensure that the solutions they provide truly fulfil your needs, and are fully tailored to your individual circumstances.

Toni and Catherine pride themselves on offering a friendly, personal service which is designed to put you at ease and support you in these important financial decisions. Their approach is highly ethical; when dealing with older clients where there may be a vulnerability concern Toni can offer an advisory service and where necessary, work with a Power of Attorney and/or make an application to the Court of Protection on your behalf.

Expert financial and legal advice all under one roof

There are many advantages of having your financial advice and legal conveyancing services all under one roof:

A fast, efficient, joined-up service that is second to none.
Transparency in terms of our fees and any associated costs.
A fully comprehensive service that is highly cost-effective.

We at Tees strongly believe that financial and legal advice should take you to the stage where you can make clear and informed decisions, happy in the knowledge that you have received all the information and choices needed to reach those decisions.

Toni is a SOLLA Accredited Adviser and operates under its strict code of conduct. Both Toni and Catherine are members of the Equity Release Council: https://www.equityreleasecouncil.com/

Only specialist advisers can offer equity release advice.

Estate planning: Equity release and inheritance tax

Posted on 26 June 202329 March 2025 by Sarah O'Sullivan

Paul and Margaret Evans are a retired couple in their late 70s. They own a valuable property worth £1.2 million and have savings and investments worth £800,000. They have two children and wish to minimise the impact of inheritance tax on their estate, while ensuring they have sufficient funds for their retirement.

Client objectives: Paul and Margaret Evans wish to reduce their potential inheritance tax liability and maximise the amount they can pass on to their children. They also want to maintain their current standard of living and have the flexibility to access additional funds if needed.

Strategy: To achieve their objectives, Paul and Margaret decide to explore the option of equity release as a part of their inheritance tax planning. Equity release allows them to release a portion of the value tied up in their property while continuing to live in it.

Recommendation and Implementation:

Initial Meeting: Paul and Margaret discuss with Toni Chalmers-Smith, their financial adviser at Tees Wealth, inheritance tax planning and equity release. Toni assesses their financial situation, including their property value, savings and investments, and determines the potential inheritance tax liability.

Equity Release Option: After reviewing Paul and Margaret’s financial situation, Toni recommends a lifetime mortgage as the most suitable equity release option. A lifetime mortgage allows them to borrow against the value of their property, either as a lump sum or in smaller amounts over time.

Loan Amount and Interest Rates: Toni calculates the loan amount Paul and Margaret can release based on their age, property value, and health conditions. They also discuss the interest rates, repayment options, and implications for their estate.

Estate Protection: To ensure that the inheritance for their children is maximised, Paul and Margaret decide to opt for an interest roll-up plan. This means they won’t make regular interest payments, and the interest will be added to the loan balance. The loan, including the accumulated interest, will be repaid upon their death or if they move into long-term care.

Inheritance Tax Planning: By releasing a portion of their property’s value, Paul and Margaret can use the funds to make gifts to their children, reducing the overall value of their estate. They consult with a solicitor at Tees to ensure the gifts are structured appropriately within the inheritance tax rules and exemptions.

Ongoing Review: Paul and Margaret maintain regular contact with Toni and their solicitor to review their estate planning strategy and make adjustments as needed. They understand that changes in legislation or their personal circumstances may require modifications to their inheritance tax planning approach.

Outcome

By utilising equity release for inheritance tax planning, Paul and Margaret achieve several objectives:

Inheritance Tax Savings: By gifting a portion of the released equity to their children, Paul and Margaret effectively reduce the value of their estate, potentially resulting in significant inheritance tax savings.

Retained Standard of Living: Paul and Margaret can access the released funds to maintain their current lifestyle, cover healthcare expenses, or enjoy travel and leisure activities during their retirement.

Flexibility: With an interest roll-up plan, Paul and Margaret have the flexibility to choose how and when they access the funds, whether as a lump sum or in smaller amounts over time with a drawdown facility. This provides them with financial security and peace of mind.

Legacy for Children: By reducing their inheritance tax liability and making gifts during their lifetime, Paul and Margaret can pass on a larger portion of their estate to their children, ensuring a more substantial financial legacy.

Important Considerations:

If you are releasing equity to gift money to another person, this will be exempt from IHT if you live for 7 years thereafter, and do not derive any direct or indirect benefit back.  However, if you die within 7 years of making the gift, it will be brought back into account with the rest of your estate when calculating the tax.

It’s crucial to note that equity release, including lifetime mortgages, is a complex financial product. Mr and Mrs Evans sought professional advice from a qualified financial adviser and solicitor to ensure they understood the risks, costs, and implications of their chosen strategy. Everyone’s circumstances are unique, and it’s important to consult with a specialist within this area of advice.

Tees is a trading name of Tees Financial Ltd, which is authorised & regulated by the Financial Conduct Authority, Registered in England, and Wales number 4342506.

Tees is a trading name of Stanley Tee LLP regulated by the Solicitors Regulation Authority, Registered in England in England, and Wales number OC327874.

What is conveyancing?

Posted on 5 April 202326 March 2025 by Sarah O'Sullivan

Conveyancing is the word typically used to refer to the legal process of buying or selling a house.

Buying and selling a house can be an exciting process – but it can also be stressful! Our team of Conveyancing experts are on-hand to provide guidance at every stage, as we want to achieve the best result for you – without any stress or worry on your part.

While first-time buyers or sellers may benefit greatly from our guide, even seasoned house movers should stay informed about any changes. Here are the important points that you should be aware of to make the process smoother and more successful:

What documents do I need to sell a house?

To help, we’ve come up with a list of the Top 10 documents which will assist when selling your home:

Title deeds and plans
Planning permission for work completed in the last 20 years
Building Regulations approval and certificates
FENSA certificates from 1 April 2002
GASAFE certificates from 1 April 2005
Electrical certificate from 1 January 2005
Guarantees and warranties for works completed
Any reports such as a flood risk or radon gas
EPC Certificate
Any indemnity insurance documents

If you are unable to provide these, we can assist in obtaining copies for you or your agent may also be able to help.

How long will it take?

This depends upon whether the sale or purchase is a one off transaction or caught up in a chain of transactions. If for example the property is empty and the buyer does not need a mortgage and the paperwork is received promptly by the buyer’s lawyer, a sale and purchase can be completed very quickly.

However, more often than not, a mortgage will be needed and there will be a chain of transactions. If this is the case, it will usually take about four to six weeks to exchange contracts and another two weeks between the exchange of contracts and final completion, making a total of six to eight weeks from start to finish.

We will always work hard to minimise delays and to try to complete your transaction as soon as possible. It is not possible however to guarantee the time it will take when a chain of transactions is involved. This is because a transaction in a chain can only proceed as quickly as the slowest person in the chain. Examples where delays could arise include when someone is waiting to receive a mortgage, to have a survey carried out or a transaction has started off later than the others in the chain or has previously fallen through.

When selling your property, we recommend gathering together all of the documentation relevant to your property and providing this to your solicitor at the beginning of the process. This will make the transaction quicker and easier to deal with.

When do I need to pay any money?

If you are buying a property your solicitor will ask you for funds, typically £350 at the start of the transaction to cover search fees. Then a few days before contracts are due to be exchanged, your solicitor will ask you for the deposit which is payable on exchange of contracts. This is usually agreed at 10% of the asking price of the property but can vary. The balance of the purchase money and solicitor’s costs including Stamp Duty Land Tax and land registration fees are payable a few days before the completion date as we must have cleared funds on the date of completion.

Do I need a survey?

The legal position is ‘buyer beware’ and that you buy a property in its existing condition with no come back against the seller if there are any defects at all. This is why it is always advisable to have a survey carried out before contracts are exchanged and you are legally committed to buy the property. If you need a mortgage, the lender will insist on a valuation being carried out to check on the value of the property but this is not a survey. It depends on the type of property you are buying as to the type of survey that it is advisable to have carried out. We will be pleased to discuss this with you and have good relationships with various local surveyors and can put you in touch with them to get this advice.

What searches do you carry out?

If you are buying a property we will carry out all appropriate searches and pre contract enquiries for you against the property. The main searches are:

Local Authority Search
Drainage and Water search
Environmental Search
Chancel Search and Land Charges
Land Registry Searches

These searches are undertaken to check that there are no adverse matters registered against the property including for example breaches of planning, proposals for nearby new roads or traffic schemes, whether there are any risks from contaminated land or flooding and whether there is any potential liability to contribute towards the upkeep of the chancel of any medieval church in the vicinity. Our drainage and water search will show whether or not the surface and/or foul water drains run into a public or private sewer and the route that they take and whether the property is connected to the mains water supply. We also ask various questions of the Seller to identify a host of important things like who is responsible for the boundaries, when the central heating was last serviced, whether there are any guarantees for building work and whether they have had any problems with the neighbours.

When do I need to arrange building insurance?

Unless the insurance is being arranged by the lender or it is a leasehold property and the insurance is dealt with by the landlord, this must usually be arranged from exchange of contracts as the property will be at your risk from that time. You should make arrangements to have this in place immediately Contracts are exchanged.

What does exchange of Contracts mean?

Once all searches, pre contract enquiries and your survey has been carried out, any mortgage offer required has been received and you and the other parties in the chain are ready to proceed, Contracts can be ‘exchanged’. There are two parts to the Contract. One is signed by the seller and the other part by the buyer. Your solicitor will check with you and the other parties in the chain as to a suitable completion date and will then ‘exchange’ the Contract with his /her opposite number. This is usually dealt with on the telephone and it is only at that stage that you are a legally committed to the purchase or sale and that a completion date is agreed.

What is the ‘Completion Date’?

This is the date agreed on exchange of Contracts for you to complete your purchase or sale. It is the day that the buyer is entitled to collect the keys and move into the property.

What happens on the ‘Completion Date’?

This is when the buyer’s solicitor sends the balance of the purchase money through the banking system to the seller’s solicitors. Once received they will call the estate agents to authorise them to release the keys to the buyers. On completion the seller has to move out (give ‘vacant possession’) and remove all furniture and effects from the property. The seller’s solicitors will send the deeds of the property to the buyer’s solicitors and send to the seller the balance of the sale monies after payment of any outstanding mortgage, estate agents fee and legal costs.

What happens after Completion?

The buyer’s solicitors will pay any Stamp Duty Land Tax and arrange for the buyer and the lender to be registered as the new owner and lender at the Land Registry.

If you are looking to buy a property, please do not hesitate to get in touch. Our specialist lawyers are members of the Law Society’s Conveyancing Quality Scheme and are based in:

Conveyancing: Glossary of terms

Posted on 26 March 202326 March 2025 by Sarah O'Sullivan

Legal terms can sometimes be confusing – here’s a glossary of conveyancing terms to help you when buying or selling a house.

Anti-money laundering (AML)

Law firms must comply with current anti-money laundering legislation (AML), meaning the laws, regulations, and procedures put in place with the aim of preventing criminals from disguising illegally obtained funds as legitimate income.

Law firms are required to comply with these laws and regulations, which is why they need to verify your ID, and if you are purchasing a property, why they ask for proof of how your funds have been obtained.

Buildings Insurance

The buyer assumes risk from the exchange of contracts, therefore, should arrange to insure the property from the point of exchange onwards. The insurance must (where a mortgage is taken out) be checked by your lawyer before exchange to ensure it complies with your mortgage offer conditions.

The seller should continue their insurance cover until completion to ensure that they are fully protected should a claim arise.

Chancel Repair Liability

Historically, homeowners were obliged to contribute towards the cost of repairs to the chancel of the local parish church. We obtain an indemnity policy on all purchases so that in the unlikely event you are asked by a church to contribute to any costs, they will be covered by the indemnity policy.

Completion

This is when you can collect the keys to the property. The completion date is agreed when contracts are exchanged. If you are buying a new property, your lawyer will advise you when you are able to pick up the keys from the estate agent.

If you are selling, your lawyer will advise you when the sale has completed, and will instruct the estate agent to release the keys to the buyer.

Contract

The legal document setting out details of the property to be bought or sold, the parties involved, the agreed sale/purchase price and any special terms and conditions previously agreed. Conveyancers use a standard form of contract that is approved by the Law Society and contains standard conditions of sale that are incorporated into all contracts for the sale and purchase of a property.

Contract pack

This is sent to the buyer’s solicitor and will contain:

the draft contract
title documents
property information form
fittings and contents form
leasehold information form (if applicable)
energy performance certificate (EPC)
any other relevant forms and documents.

Covenants

Obligations and restrictions, known as ‘positive’ and ‘restrictive’ covenants can be attached to a property. Positive covenants are generally an obligation to do something. An example could be an obligation to keep the fences in good repair. Restrictive covenants generally prevent you from doing something. For example, you may be prevented from building any additional structures on the land.

Deposit

If you are purchasing a property, you are required to provide a deposit of 10% of the purchase price (although smaller deposits can be accepted in some circumstances if agreed between the parties).

A lawyer cannot exchange contracts until they are holding your deposit funds (if you are also selling a property, they can use the money available from that transaction towards the deposit on your onward purchase). The deposit monies will be held by solicitors following the exchange of contracts and will not be released to the seller until completion. There are exceptions to this in the case of new build properties, however, at Tees, if this applies to you, your lawyer will discuss this with you.

Disbursements

Disbursements are costs incurred by a law firm on your behalf. The firm will ask for associated funds upfront which they use to pay these disbursements and other administrative charges. Examples of disbursements include the management pack on leasehold sales, or the searches, such as a local authority search.

This money will be held in the law firm’s client account until it is needed. Any money they hold on account that is not used will be refunded to you on completion.

Easement

An easement is the legal right to exercise privileges over another person’s land. For example, an easement might provide a right of way across a piece of land, or a right to lay pipes or cables.

Enquiries

Enquiries are simply questions raised by the buyer’s solicitor. These questions come to light as they receive information and documentation throughout the course of the transaction. They may include questions that have arisen from the documentation provided by the seller’s solicitor, the results of the searches, survey, mortgage offer or any additional questions the buyer may wish to raise.

Some of these questions can be answered by the lawyer, others may need your input. However, your lawyer will show you the answers they have given to all enquiries raised.

Energy performance certificate (EPC)

An EPC sets out the energy efficiency of the property on a traffic light system of A to G, with A being the most efficient. The EPC needs to be obtained upon any sale of a property and will usually be sourced by your lawyer.

Equity

The difference between the value of a property and the figure owed to the mortgage Lender.

Exchange of Contracts

This is the point where the contract becomes legally binding, and a completion date is agreed. Once exchanged, if you wanted to withdraw from the contract, you would be in breach of contract and forfeiture of your 10% deposit to the seller.

The lawyer will need to have an original, hard copy of the contract signed by you in before they can exchange contracts.

Fixture, fittings and contents form

Provided by the seller’s lawyer, this form is filled out by the seller and sets out what parts of the property are included in the sale and must be agreed by the buyer before purchase.

Freehold (Absolute)

This is a class of property title which gives outright ownership of the property and land on which it stands.

Ground rent

This is a payment specified in a lease that the leaseholder is required to make to the landlord. This is usually paid in yearly or half yearly instalments.

HM Land Registry

The government body that deals with ownership of property and land throughout England and Wales. HM Land Registry must be notified of all matters which affect/alter a property title. They will update the title documents accordingly.

Joint Tenancy

The term ‘joint tenancy’ refers to a legal arrangement in which two or more people own a property together, each with equal rights and obligations. Joint tenancies can be created by anyone owning a property with more than one other person.

If two people own a property as Joint Tenants they benefit from the right of survivorship, meaning, that if one owner dies, their interest in the property automatically transfers to the remaining owner.

Land Registry official copies

These encompass the information within the title deeds to a property – they are downloaded from the Land Registry and provide the most up to date information on every property that is registered in the UK.

The Title Register confirms the property address, title number, owner(s) and can also detail any restrictions or charges over the property.

The Title plan shows the physical extent of a registered property.

If a property is unregistered, a lawyer would use the title deeds to apply for first registration. Once completed, the Land Registry would then issue Official Copies of the title.

(The) Law Society

The Law Society is the representative body for solicitors in England and Wales.

Leasehold

Leasehold interests are created by the grant of a lease over a property, allowing the owner of the leasehold interest exclusive possession of the property for the term of the lease.

The owner of a leasehold title is registered as the legal owner on the associated leasehold official copy documents. The freehold ownership is retained by the landlord.

Leasehold property information form

This form is used when dealing with leasehold properties. It provides additional information to the buyer that is relevant only to leasehold properties, for example details of the management company.

(The) Legal Ombudsman

The Legal Ombudsman offers an independent and impartial complaint handling service to all those who are not happy with their legal professional. If you have complained to your own solicitor, they have eight weeks to deal with your complaint. If you are not satisfied by the outcome of the complaint, then you may escalate your complaint to the Legal Ombudsman.

Limited title

Properties are sold with limited title guarantee when the seller has no personal knowledge of the property, for example when personal representatives are selling a property when the registered owner has passed away.

Managing agents

A managing agent is a company employed by the landlord in the case of leasehold properties (usually flats) who are responsible for looking after the maintenance and repair of the building as well as the buildings insurance.

Mortgage deed

The Mortgage deed is the document by which you charge the property to the lender as security for the loan. The deed must be signed by the borrower and is sent to the Land Registry on completion to register the bank’s charge over the property.

Mortgage Offer

If you need a mortgage, contracts cannot be exchanged until the mortgage offer has been received. Usually, you will receive your mortgage offer copy a few days before your lawyers receive their copy.

It is important to check the terms and conditions of the mortgage offer to ensure you are able to comply with them, and that the amount you are borrowing and the associated terms are correct.

Property information form

Sellers are required to fill this form in and return it to their lawyer. It asks questions regarding boundaries, disputes, services, legal rights, restrictions and other important information about the property. Failure to provide correct information could result in action being taken against you for misrepresentation; in cases where you’re unsure your lawyer should be able to help.

Redemption Statement

This document confirms the amount payable to your mortgage lender on completion of a sale or re-mortgage. There may be a penalty associated with redemption if a fixed rate mortgage is being repaid early.

Searches

The buyer’s solicitor will request several searches which reveal additional information about the property. Your lawyer will send you a report on the search results identifying the main points that you need to be aware of.

The searches that Tees generally request are:

local authority search: this reveals any applications for planning permissions that have been made in connection with the property; information on the roads serving the property including any proposals for new roads or railways; any restrictions on the property (such as if the property is in a smoke-controlled zone); and any other relevant information.
Drainage search: this reveals whether the property is connected to mains water, drainage and sewage systems and shows the location of the mains in conjunction with the property boundaries.
Environmental Search: this is a desktop search which reports on any environmental concerns such as risk of flooding; ground stability and radon gas.

Service charge

A sum paid in the case of leasehold properties (usually flats) to the landlord or management company/agent to cover the cost of items such as any repairs, maintenance or improvements that need to be made to common areas of a property, insurance premiums or administration costs.

Solicitor’s Regulation Authority (SRA)

The independent regulating body of the Law Society of England and Wales. The SRA can be called upon to deal with disputes if you have received an unsatisfactory service from your solicitor.

Stamp Duty Land Tax (SDLT)

This is a tax which is payable by the purchaser upon completion of the purchase of a property. Generally, the amount of tax due is based upon the purchase price. There are some reliefs and exemptions available in certain circumstances.

Your lawyer will complete the necessary forms and arrange to pay the stamp duty to HMRC (Her Majesty’s Revenue and Customs) on completion. The lawyer will send you a copy of these forms for approval prior to completion of the purchase so that you may sign the same to confirm the details are correct. You are required to transfer us the necessary funds to cover the Stamp Duty after exchange, but prior to completion of the purchase.

Survey

This is a report carried out for the buyer by a surveyor to provide an insight into the physical condition of a property. If there are any concerns that arise from your survey of the property, your lawyer can raise these with the seller’s solicitor, however lawyers are not qualified to give professional advice on the results of a survey – you should consult the relevant professionals for example those in the building trade.

Tenants in Common

Where a property is owned as tenants in common, this means that each owner owns a distinct share of the property (shares can be equal or unequal), the proceeds of which they are entitled to on sale of the property.

With this type of ownership, there is no right of survivorship, so if one owner were to pass away, the property does NOT automatically pass to the surviving owner but instead will pass according to the deceased owner’s Will or probate rules.

Title absolute

This is the strongest form of property ownership and there is very little possibility that ownership could be challenged.

Transfer Deed (TR1)

The document that legally transfers the property from the seller(s) to the buyer(s). It must be signed in the presence of an independent witness (i.e. not a relative, spouse, or someone that currently resides at the same address as you).

Upon completion, this together with any other deeds and documents are sent to the buyer’s lawyers who will arrange for the transfer to be submitted to the Land Registry for the title to be updated.

Vacant Possession

Most properties are sold with vacant possession which means the seller must have vacated on or before completion. There must be no one remaining in occupation and the seller must, as a rule, clear the property of all goods and rubbish except those included in the sale.

Building Safety Act: Leaseholder and landlord certificates

Posted on 20 February 202326 March 2025 by Sarah O'Sullivan

What is the Building Safety Act 2022?

The Building Safety Act 2022 is new legislation which has brought major changes to give homeowners and tenants more rights, powers and protection so that homes will be safer all over the country.

If you are a landlord, please refer to our article Building safely act and fire safety act 2022: implications for landlords

Building Safety Act 2022 summary

The Act came into force in June 2022, largely in response to the issues brought to light following the tragic Grenfell disaster, which left some leaseholders facing huge bills to remedy building defects to make buildings safe and preserve the financial value of their properties.

A key part of the legislation is to deliver strong protection for qualifying leaseholders from the costs of fixing historical defects and safety problems (such as unsafe external cladding). It makes sure those responsible for past faults are held accountable instead.

What are the leaseholder protections in the building safety act 2022?

The leaseholder protections came into force on 28 June 2022, with new financial protections for leaseholders in relevant buildings with relevant historical safety defects.

The law now requires those who constructed faulty buildings to take responsibility for fixing them, while also granting legal protection to leaseholders from exorbitant bills for historical safety problems.

The government is firm that developers must pay for repairing buildings they were involved in building or renovating, even if they don’t own the building anymore. The law holds building owners or those associated with the developer, responsible for paying for the remediation of historical safety defects.

Courts now have expanded powers to impose liability on related companies, so that legal cases for claims against defective buildings can be brought against companies linked to the developer, preventing them from escaping responsibility by using complex corporate structures.

In cases where a developer can’t be found or has not yet agreed to pay for their own buildings, funds will be provided directly, to cover the cost of fixing cladding systems and remediation, ensuring that no eligible leaseholder has to bear the expense.

Eligible leaseholders are protected from all external cladding system remediation costs. Leaseholders whose property is valued at less than £325,000 in Greater London (£175,000 in other parts of England) or whose building owner has a group net worth of more than £2 million per building as of 14 February 2022, are exempt from historical safety remediation costs.

The law sets a firm cap on contributions from eligible leaseholders for non-cladding defects and interim measures (including the costs of trained personnel to detect and respond to any potential fire hazards i.e: “waking watch” costs), spread over 10 years, with costs already paid since 28 June 2017 counting towards the cap. If the remediation costs exceed the cap, building owners must make up the difference.

The law includes strong measures to ensure those responsible finally rectify dangerous buildings they contributed to and to protect leaseholders from the unjust costs of remediation they previously faced.

If you’re a leaseholder in England, please refer to the Gov.uk link to check whether you’ll have to pay to replace cladding or to fix other safety problems with your building.

What leases qualify for protection?

There are criteria which must be met in order for a leaseholder to benefit from the protections created by the Act:

The lease must be for a single dwelling within a building of above 11 metres high or at least five storeys
The lease must be for more than 21 years
The leaseholder must pay a service charge
The lease must have begun before 14 February 2022 and as of 14 February 2022, either:

a) the dwelling must have been the leaseholder’s only or main home; or

b) the leaseholder did not own more than 3 dwellings in the UK.

What is a Leaseholder Deed of Certificate?

A lease must have satisfied each of these criteria as of 14 February 2022 to qualify for protection and, as evidence of this, the status of a lease on that key date must now be documented in a Leaseholder Deed of Certificate.

The Leaseholder Deed of Certificate will demonstrate whether the leaseholder can be responsible for paying for remediation works. Where the leaseholder can be asked to pay for these works, it enables building owners to calculate the cap on those costs.

The Leaseholder Deed of Certificate contains a series of questions and answers which assess whether the lease meets the required criteria for protection for example:

It must contain details of the current leaseholder,
who the leaseholder was on 14 February 2022,
the price the property was last sold for
and whether the lease is a shared ownership lease.

There may also be required additional documents that must accompany the Deed of Certificate, such as evidence of past sales of the property and the price paid.

Notwithstanding the importance of the Leaseholder Deed of Certificate for protecting leaseholders from repair costs, requests for deeds of certificate will become routine in conveyancing transactions and leaseholders planning to sell their properties should be aware of this and prepare in advance if possible.

What should I expect from my landlord or building owner?

The Leaseholder Deed of Certificate outlines the cap on costs the leaseholder can be asked to pay. Equally, a Landlord Certificate is a new requirement under the Building Safety (Leaseholder Protections) (England) Regulations 2022 and contains parallel information to calculate how much the landlord can charge leaseholders for building-safety works.

The Landlord Certificate acts as a permanent record as to the status of the lease on 14 February 2022 and must contain details about the current landlord, who the landlord was on 14 February 2022, their involvement in commissioning the defective work and any remediation works which have been carried out previously.

The landlord must provide leaseholders with a Landlord Certificate in the following circumstances:

When the landlord wants to pass on any costs for repairing defects onto a leaseholder through the service charge
Within four weeks from receiving notification from a leaseholder that the leaseholder intends to sell their property
Within four weeks of the landlord becoming aware of a relevant defect which was not covered by a previous Landlord Certificate; or
Within four weeks of a leaseholder requesting a Landlord Certificate.

As with the Leaseholder Deed of Certificate, the Landlord Certificate will also become a necessity in conveyancing transactions and requests for them will become routine.

Leaseholders that are planning to sell their properties should ensure they request a Landlord Certificate as early as possible in the transaction, if not prior to finding a seller, to minimise any potential delays while landlords deal with requests and preparation of the certificates.

If you have any queries arising from the points raised in this article, please contact Amy Barrington who will be very happy to help.