Property is one of the few assets whereby the sale and purchase must be in writing, the process can involve a lot of documentation below we discuss the most frequently required documents.

What is a Property Transfer Deed?

The property transfer deed is the document that transfers ownership of the property from the seller to the buyer. It must be signed by all sellers, it will also normally be signed by the buyers, although this is not strictly necessary unless the property transfer includes covenants by the buyer or unless there is more than one buyer.  The buyer’s ownership can only be registered once they have a property transfer deed signed by the sellers therefore the sellers’ solicitor must have the signed property transfer deed in their possession on completion.

What is a Deed of Covenant?

When buying a leasehold property, a Deed of Covenant may be required. It is a legal witnessed document that the buyer of the property sign to say they agree with the lease terms. The incoming Leaseholder agrees to pay the Landlord ground rent, service charges and to also monitor certain restrictions.  The Deed and or the Lease will contain specific details about what the person residing at the property has to comply with. For example, in some cases, you may be unable to keep pets at the property. 

What is a Licence to Assign and how does it work?

A provision found in both residential and commercial leases and is required by the Leaseholder to obtain the Landlord’s consent before any transfer of Leasehold.  This means that the freeholder’s consent must be obtained by the seller, at the seller’s expense before the transaction may proceed to completion. It is commonly used when buying a property that is part of a block of flats. In cases where the service charge is high, its purpose is to ensure that the new property owners’ financial status, is able enough to pay the service charge. It could also be to prevent the property from being sold to a company. It works in the way that the freeholder will need to instruct their solicitor to obtain evidence from the buyer, this is usually by way of a bank statement to state that the buyer is capable of meeting the service charge payments.

What is a Certificate of Compliance?

It is required when a restriction is set out in the Official copy of the Register of Title, to show that the terms of the Lease have been complied with. It is issued by the Landlord or Management company once they are satisfied that the incoming Leaseholder or their solicitors have complied with the conditions and restrictions found in the title and the required actions have been taken. After the landlord or management company issue the Certificate of Compliance to the Land Registry the restriction is then removed, and the purchasers’ ownership will be registered by the Land Registry.

What is a Stock Transfer Form?

A Legal document that enables shares to be transferred from the seller to the buyer. It contains both parties’ details, the number of shares being transferred and also the amount paid by the buyer.  This is used when the property is leasehold and the freehold is owned collectively.