Mortgages

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By Alice Lilley

Buying or selling a property can be a frustrating process that takes many months, but estate agents hope that a new online service being launched by the Land Registry will make it quicker and easier for all those involved.

Most residential property sales are part of a chain, with each transaction dependent on others further up or down the line. Hold-ups in any part of the chain can cause long delays for everyone involved as a result.

This is hardly surprising considering that the system we use in Britain at the moment dates back more than three-quarters of a century and is widely recognised as being overly complicated and unable to provide adequate protection for consumers.
The aim of the Land Registry's new website is therefore to make it easier for conveyancers, estate agents, lenders, buyers and sellers to keep track of developments in their chains.

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Due to be trialled early next year, it will enable all the above to log on to the internet at any time to see how far a transaction has progressed.

Details of any delays, and what caused them, will be shown on the system, and those involved will also be able to leave messages for each other.

The Land Registry said: "Our mission is to develop an electronic system of conveyancing that makes buying and selling houses easier for the general public, conveyancing professionals, and other parties involved in the process."
There are a number of ways online conveyancing should improve the process.

When dealing with a property purchase, for example, conveyancers must check with the Land Registry to ensure the vendor has the right to sell, conduct local authority searches to verify, for example, that no major roadworks are planned behind the property, and make sure any leases are acceptable.

Whereas this can currently take days or even weeks, once the new system comes in, automatic validation checks will compare the information on the contract with Land Registry data and electronic messages will be sent out immediately if there are any discrepancies.

The same is true when it comes to the final checks prior to exchange, as conveyancers will be able to see online whether there are any things - such as bankruptcy notices - that could adversely affect the deal.

All transfer documents will be able to be signed electronically and all financial obligations, including Stamp Duty Land Tax and Land Registry fees as well as payments between buyers, sellers, lenders and conveyancers, will then be settled electronically.
It is hoped that this will reduce the amount of mistakes made in calculating the related taxes and charges as well as speeding up the amount of time it takes such payments to clear and making it easier for all the exchange and completion dates to be synchronised.

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Online conveyancing is not a new idea. Preliminary proposals for an online conveyancing service were set out in a report issued by the Land Registry and the Law Commission in 1998.

Unfortunately, however, the secure system has taken a long time to develop and the process was also held up by the need for new land registration laws to be introduced in 2002.

Even now, it is not ready to be rolled out across the whole country. Instead, about 80 Bristol-based law firms and their clients will try out the system for the first six months. The trial was supposed to start this month but has been postponed until early next year due to "issues" that have arisen during testing.

"Our aim throughout the programme is to introduce new services incrementally, in steps that will be manageable for all users," the Land Registry said.

Once the system does come into force, though, it will also make it easier for both buyers and sellers to keep tabs on their conveyancer or solicitor and make sure they are taking the necessary action within a reasonable timeframe. This will doubtless be welcomed by many homeowners who have had problems with solicitors and conveyancers holding up their transactions in the past.

Estate agents claim that the introduction of online conveyancing will also make it possible for them to provide a better service for buyers and sellers alike.

Charles Smailes, president of the National Association of Estate Agents, said: "Online conveyancing is an extremely important development for improving the buying and selling of residential property.

"Estate agents will be able to provide a more concise and effective service for their clients as they will have access to the most up-to-date information on their computers."

Most are also optimistic that a quicker, more transparent, system will have a positive effect on the housing market.
Smailes said: "The possibility of online completions and instant registration of title deeds is very exciting indeed as it will dramatically improve the length of time it takes to sell a home."

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