Trying to save money by doing your own conveyancing is likely to land you in deep water, legal experts have suggested.
With house prices continuing to rise, buyers are increasingly looking for ways to minimise the financial outlay, including through so-called ‘DIY’ conveyancing.
Research reveals the average ‘upfront cost’ of purchasing a home in the UK exceeds £38,000 — this refers to the fees that a purchaser must pay for the sale to go through. Costs include stamp duty, deposit and valuation fee.
However, while the DIY route may help to save £300 to £600 — a fraction of overall purchase costs — it also opens buyers up to huge risks.
Caroline Murray, partner and head of the property department at Graysons Solicitors in Sheffield, said: “Although doing your own conveyancing is legal, and possible in theory, you can only act for yourself in very few situations — either a transfer of equity, a cash purchase (so no mortgage) or a sale with no existing mortgage to redeem. Even then, it can cause a number of problems.
All the paperwork involved requires a huge commitment of time and effort, not to mention a strong understanding of property law.
But perhaps the biggest obstacle is that individual homebuyers do not have negligence insurance — this is only available to qualified legal professionals — which means that if you make a mistake in the conveyancing process you’ll be personally liable and the cost would end up being considerably higher."
In addition, a small number of mortgage lenders appoint their own solicitor to look after their interests before agreeing to lend money — a service which is charged to the buyers, meaning they will still be paying for conveyancing without any of the legal protection for themselves.
HM Land Registry also points out that ‘depending on the type of transaction, there can be quite a lot of legal and financial aspects that will need to be covered in the preparation of the documents. These may not be part of the standard forms’.
According to research from TotallyMoney, it is the unforeseen and hidden aspects of buying a home that ramp up the overall cost, rather than typical outlays such as deposits, estate agent and solicitors’ fees.
The study says that commissioning surveys, fixing cracks and replacing the boiler — among other potential costs — can represent up to 40% of the total upfront cost.
Caroline concluded: “There’s no doubt that purchasing a property is one of the biggest financial commitments people can make. But for that reason it’s not advisable to cut corners for the sake of attempting to save a relative fraction of the overall costs.
Alongside the risk of bearing full responsibility for any possible mistakes, such buyers also face the difficulty of liaising with the sellers’ solicitor without having a conveyancing licence or extensive knowledge and experience of property law. For this reason we strongly advise against DIY conveyancing, and advocate using the services of a reputable conveyancing solicitor.”