Examplestandard Requirements Letter Sent by the Lender S Conveyancer to the Buyer S Conveyancer

ExampleStandard Requirements Letter sent by the Lender’s Conveyancer to the Buyer’s Conveyancer

Introduction

This example letter assumes that you, as the Lender’s Conveyancer, have sent an initial letter to the Borrower’s Conveyancer notifying them that you have been instructed on behalf of the Lender and seeking confirmation that they are instructed on behalf of the Buyer of the Property.

The example letter below is a suggested format only and may be adapted by Lenders and their Conveyancers for their own use. Where words are in square brackets, this indicates suggestions for adapting the content to meet particular circumstances or an individual Lender's requirements. FOr example, UNLESS THE LENDER SPECIFIES OTHERWISE, ARRANGEMENTS FOR the payment of your fees is a matter for AGREEMENT WITH THE BORROWER'S CONVEYANCER and a number of SUGGESTED options are presented in square brackets below.

LENDERS SHOULD TAKE THEIR OWN LEGAL ADVICE IN RELATION TO THEIR REQUIREMENTS. The Council of Mortgage Lenders does not accept any liability to lenders or their conveyancers for any loss suffered by either of them in the event that they place reliance on thisExample letter.

Property

Borrower

Lender

Further to our recent letter confirming that we have been instructed by the Lender, please find below details of the documents and information that we require as this will enable us to give a clear Certificate of Title.

We would strongly recommend that you do not exchange contracts on the purchase of the Property before we have confirmed to you that we arein a position to proceed.

[We will forward the Lender’s Mortgage Deed, Mortgage Conditions booklet, copy Mortgage Offer[add any other relevant documents which the borrower or third party must sign e.g.Deed of Guarantee or Occupier’s Consent Form] or

[We enclose:-

• Copy of the Mortgage Offer ;
• Mortgage Deed;
• Mortgage Conditions booklet;
• [add any other relevant documents which the borrower or third party must sign e.g.Deed of Guarantee or Occupier’s Consent Form].

We shall do our best to assist you and the Borrowerto be in the position to exchange contracts when you would like to do so. To facilitate this please:

(a)Forward the pre-exchange documents and information stated below at the earliest opportunity. Please send these to us ideally as one package. However, if you become aware of any matter which you believe may lead to difficulties in us providing theLenderwith a clear Certificate of Title, we request you draw this to our attention as soon as possible in order to avoid issues arising immediately before exchange of contracts.

(b)Inform us if you are aware of a date or deadline for exchange of contracts.

(c)Give us at least[7] days to review any outstanding information or documentation not previously supplied to allow us to raise any queries and satisfy ourselves with the replies.

(d)Provide all other information and documents you are aware of which might affect the mortgage transaction or the quality of title or security.

We appreciate that you may not be given information from the Seller’s Conveyancer until shortly before exchange of contracts but we would ask you to make the Seller’s Conveyancer aware of our timescales.

If exchange and completion is to take place simultaneously then we shall also require you to provide the post exchange/pre completion information and documentation at least [7] days before completion.

[Where occupier’s consent is required, you must provide us with evidence that you have obtained this consent. The evidence will need to state, having made all such enquiries as are reasonable:

(a)the full names of all persons other than the Borrower who will now or hereafter occupy the whole or any part of the Property, their relationship (if any) to the Borrower, and their ages (if under 18);

(b)the full names and addresses of every person other than the Borrower:

1. who will contribute to the purchase, improvement, maintenance or outgoings of or in relation the Property; or
2. who has entered into an arrangement or understanding under which he/she may claim some right to remain in occupation of the whole or any part of the Property or to share in the proceeds of sale of the Property;

(c)if the Property is to be used otherwise than as the principal private residence of the Borrower and any persons referred to in (a) above, and

(d)if the balance of the cost of the purchase will not be provided by the Borrower from his own resources (you must supply any relevant evidence proving the source of these funds)].

We remind you of the [limitations of the Lender’s valuation as set out in Part 1, Paragraph 4.4 of][limitations to indemnity insurance in Paragraph 9.2 of][information about mortgage indemnity insurance in] the CML Lender’s Handbook. You must explain these limitations to the Borrower and confirm to us that you have done so.

Neither we nor the Lender canaccept any responsibility for any delays in exchange or completion which might arise because we do not receive all the documentation and information requested below.

The Borrower is responsible for payment of our fees as well as your own whether or not the transaction proceeds to completion. We expect our fees to be £[xxx.xx] plus VAT.

[We will deduct our fees and relevant disbursements from the mortgage advance.] or

[We require payment of our fees before we will commence work on the transaction; if it does not proceed to completion, we will refund a proportionate part of the fees which represents any work not undertaken by us] or

[We require your undertaking before we will commence work on the transaction that you will pay our fees whether or not the transaction proceeds to completion].

Prior to completion, we will provide you with a completion statement which details our fees; please make the Borrower aware of these requirements.

We undertake to you that, provided you comply with the requirements set out in this letter, we will, following completion, apply to register the transfer within the priority period of the OS1 or OS2 Land Registry search, and will diligently pursue the application for registration of the transfer and mortgage.

Pre Exchange;

Before exchange of contracts, we require the following documentation:

A [copy] [sample] of the letterhead of the Seller’s Conveyancer

Copies of the Borrower’sproof of identification and residence, certified by you, to be a true copy of the original

Copy of the approved contract

Official Copies of the Register and Title Plan(which should be no more than 6 months old when you send them to us), together with copies, where appropriate, of any filed or noted documents. Alternatively, a full Epitome of Title acceptable to Land Registry to acquire Title Absolute or Good Leasehold Title if this meets the Lender’s requirements in the CML Lenders’ Handbook

Copiesof replies to the Property Information Form and Leasehold Information Form, as well as to any additional enquiries and requisitions raised

Copy Local Authority Search (this must be an official search of LLC1 and CON29 part 1) CON29DW, Con29M coal mining and brine subsidence and any other relevant searches (e.g. Index Map Commons Registration, Environmental,Chancel Repair), and any additional search which is usual to undertake in the locality. Please see Part 1 and 2 of the CML Lenders' Handbook to see whether the Lender accepts personal searches. If you intend to use personal searches, please contact us to discuss this so we can ensure we are able to rely on the searches

Copies of all/any existing and proposed Indemnity Policies considered appropriate

Copies of all Planning Permissions, s.106 Planning Agreements, Building Regulation Approvals and Completion Certificates and any other documents which you believe to be relevant to enable you to satisfy our requirements under Paragraph 5.4.1 of Part 1 (and Part 2 if relevant) of the CML Lenders’ Handbook.

Copies of any Competent Persons’ Certificates applicable to theProperty, if available and not revealed by your Local AuthoritySearch

Details of any incentive, allowance or retention whether these are to occur pre- or post- completion

Full details of any further borrowing or other proposed charges over the Property

A copy of the settled Transfer Deed

A copy of any existing or proposed Assured Shorthold Tenancy Agreement (if applicable) or any other lease or agreement affecting occupation of the Property (if applicable)

If Leasehold, please ensure we are provided with the following further documents;

• Official Copy Lease
• Deeds of Variation to the original lease
• Company Memorandum & Articles of any management company and the landlord (if applicable)
• Share certificates and share transfer forms(if applicable)
• The last 3 years’ service charge accounts
• The last 3 years’ management accounts
• A full Company Search against any management company and the landlord(if applicable)
• The Landlord and/or Management Company’s leasehold information pack/ replies to enquiries
• Specific confirmation from you that all ground rent and service charges will be up to date on completion and that you do not expect there to be any outstanding disputes
• Resolutions to achieve satisfactory outcomes to Land Registry restrictionsSpecific confirmation that you will serve notice of transfer and charge in accordance with the lease or other requirement affecting the title to the property immediately following completion and,if received by you, forward the receipted notice to us

Confirmation that the full balance of the purchase monies together with monies to cover Stamp Duty Land Tax and costs have or will be received by you from an identifiable source that is disclosed to us

The current version of the CML Disclosure of Incentives Form (if relevant)

Energy Performance Certificate

Pre Completion;

You should send us:

Full Priority Search (OS1 or OS2) in favour of the Lender

Copy approved Transfer (please advise in advance if there is a Power of Attorney for the Borrower or Seller, and, if so, provide the certified copy of the Power of Attorney to verify this)

Copy replies to Completion information and Undertakings

Up to date and clear Bankruptcy and Land Registry/Land Charges Searches against all Borrowers, and office copy entries of details revealed by the bankruptcy search, to expire after the date of completion. If the searches are not clear, you should certify that the entries do not relate to the Borrowerand/or the Property as appropriate. You should ensure that the Land Registry searches made also cover the Lender

Legal Charge/Mortgage Deed duly signed by allBorrowersand witnessed (please do not alter the standard form)

Properties less than 10 years old and conversions, either: -

• New home warranty documentation, including the Cover Note where this is the initial sale of the property; or
• TheProfessional Consultant’s Certificate, which forms an appendix to the CML Lenders’ Handbook

For leasehold properties – a clear current receipt for ground rent/service charges and confirmation from the Landlord or its agent that there is no outstanding dispute

Conveyancer’sPre Completion Undertaking and Funds Request signed and completed at least [7] days before legal completion

Completed Land Registry application form for us to sign as the ‘sending’ conveyancer for the purposes of Panel 7 of form AP1.For the avoidance of doubt we will also complete Panel 12 and the relevant section of Panel 13. You must leave us to sign this form as we will send it to the Land Registry

As agent of the Lender and the Borrower, an undertaking that you will within [7] days of completion, submit the SDLT 1 Form and any supplementary SDLT forms, and duty payable to H M Revenue & Customs and provide us with the Land Transaction Return Certificate (SDLT5form)at least [10] days before the expiry of the priority period on the OS1 or OS2 Land Registry search

Confirmation by yourselves that you have complied with your obligations to the Borrower [(and any other person signing a document relating to the mortgage transaction]) the legal implications of signing the mortgage[(or such other document)]

Confirmation that you have informed the Seller’s Conveyancer to expect the mortgage advance directly from us

Confirmation that you have complied with Paragraphs 7 & 8 of the CML Lenders’ Handbook in relation to any Occupiers who live in the Property

On completion, we will send the net mortgage advance directly to the Seller's Conveyancer by electronic transfer. [We will deduct the costs and disbursements outlined in our completion statement from the mortgage advance.] We will require the Seller's Conveyancer to undertake to hold this money to our order until you confirm that you are ready to complete. You should notify us of any anticipated delay in completion.

We will require the Seller's Conveyancerto undertake directly to us to discharge any charges secured on the Property and to send directly to us the executed transfer and any other documents required to enable us to effect registration.

Post Completion;

You should send us:

the Land Transaction Return Certificate(SDLT5 form) at least [10] days before the expiry of the priority period on the Land Registry search

The SDLT 1 and any supplementary forms forming the Land Transaction return within [7] days of completion. We recommend you submit the SDLT application online in order to assist you to meet this deadline

[On risk Buildings Insurance policy]

[Confirmation that a buildings insurance policy is in place (and that it complies with the Lender’s requirements relating to Buildings Insurance as set out in Parts 1 & 2 of the CML Lenders’ Handbook), together with the name of the insurer, the policy number and the level of cover]

[Certified Copy of the Dated and signed Tenancy Agreement (if applicable)]

[Where received by you, the receipted notice of charge]

Any applicable signed consents

Any other documents that we are required to send to the Lender in accordance with the requirements of Part 1 and 2 of the CML Lenders’ Handbook

You should arrange for the Seller’s Conveyancer to send direct to us:

Executed transfer;

Discharge documents, and

Any other documents that they are required to send to the Lender in accordance with the undertaking they have given to the Lender

Example Borrower’s Conveyancer’s Undertaking and Confirmation Letter to Lender Conveyancer

Pre Completion

To:

From:

Purchaser:

Property:

Lender:

We act on behalf of the Purchaser in relation to the acquisition of the Property.

1.We confirm that we have explained to the Purchaser the:-

1.1nature and conditions of the Mortgage Offer issued by the Lender and the legal implications of a mortgage.

1.2limitations of the Lender’s valuation in accordance with the CML Lenders’ Handbook, and

1.3(if applicable) requirements of the Lender with regard to type of letting agreement required/prohibited and the conditions that should form part of that agreement.

In consideration of the Lender advancing funds, we undertake and confirm to the Lender and [insert Lender’s conveyancer’s name] as set out below.

2.The agreed purchase price of the Property is £ [insert price].

3.The completion date is [insert date].

4.To reportto you if we will not have control over the balance of funds required to complete the purchase (for example, if it is proposed that the borrower pays money to the seller direct), with the exception of the mortgage advance, or a deposit held by an estate agent or a reservation fee of not more than £1,000 paid to a builder or developer.

5.There are no amendments or alterations to the information we have previously provided to you.

6.[Your legal costs in acting for the Lender will be covered, irrespective of whether the matter proceeds to completion.]

7.The mortgage deed has been signed and all signatureswitnessed.

8. There is no Stamp Duty Land Tax avoidance scheme operating.

9.We will also obtain an undertaking from the Seller’s Conveyancer addressed to you that:

(a)upon receipt of the net mortgage advance they will hold it to your order until they are in receipt of the balance of the purchase monies and they complete the sale to the Purchaser; and

(b)if completion does not take place within 24 hours (or two working days) of receipt by them they will forthwith return funds to you by telegraphic transfer at the Purchaser’s cost and;

(c)they will on completion discharge all mortgages on the Property and provide evidence of discharge to you as soon as received.

We will provide a copy of this undertaking.

10.We shall send you any documents we hold that are required to be sent to the Lender in accordance with the CML Lenders’ Handbook Parts 1, 2 or 3.

11.We shall submit all relevant Stamp Duty Land Tax returns to HM Revenue & Customs without delay and in particular within [7] days of completion and provide the Land Transaction Return acknowledgement form to you at least [10] days before the end of the priority period on the OS1 or OS2 Land Registry search. We will carry out our obligations as agents in respect of Paragraphs 10.5 and 10.6 of Part 1 of the CML Lenders’ Handbook.

12.The contract provides that the Purchaser will obtain vacant possession of the Property on completion.

13.Following completion, we shall hold strictly to your order all relevant documents (required by the Lender in accordance with this undertaking or any correspondence received from the Lender’s Conveyancer) collected or otherwise held by us in respect of the transaction and to deliver them to you within three working days of completion.

14.We shall notify you of any change of information supplied to us before completion.

15.We shall submit the necessary Notice of Assignment and Charge forms in accordance with the terms of the lease or other requirement affecting the title to the property and provide you with the receipted notice, where received by uswithin one month of completion (if leasehold).

16.We shall use [best/reasonable] endeavours to assist you with any requisitions raised by the Land Registry.

17.[any other undertakings you consider appropriate].

Signed

(Date and insert details of conveyancer signing undertaking)