Upfront material information. A better way to streamline your conveyancing cases
21 Jun 2023 |
Joanna Fowke |
Frustration remains among property professionals about transaction delays. 40% of property transaction hold-ups are blamed on managing enquiries with duplication/confusing communication, ordering and receiving search results, and Land Registry log jams - all featuring in the top five causes, according to the recent industry research report ‘Back to the Future’ from tmgroup, mio and CDS.
It’s easy to see why delays like these are leading to average transaction times of 5-6 months, and a continued fall through rate of approximately 30%. And with consumers also paying the price, 98% are overwhelmingly in favour of more information being provided upfront, ahead of the conveyancing process, according to research by the Conveyancing Association.
So, it’s somewhat unsurprising that there is now a concerted drive in the industry to stem the tide of delays with the welcoming of upfront material information to the home moving process. All professionals involved in the transaction have a vested interest in making it more consumer-focussed and fail-safe for the benefit of everyone.
Upfront material information is a big step towards achieving that goal. It is a new way to help the property transaction become more efficient by starting the process of gathering vital information early – while the seller’s property is being actively marketed.
Upfront material information is here, with more to come
The Home Buying and Selling Group (HBSG) is leading the upfront information agenda. Actively working with industry suppliers, like mio, tmgroup and CDS as well as the Government, HBSG is offering a legally endorsed dataset to help collate all the necessary material information on a property. Digitised versions, like the Seller’s Information Pack (SIP) from mio, promote collaboration and allow an early disclosure of crucial information to a prospective buyer, helping them make an informed choice about the subject property.
The ease of sharing also benefits conveyancers. It offers them a secure, quick and convenient method of obtaining, assessing and investigating accurate property information already gathered by estate agents with the support of trusted data providers. This encourages early instruction of conveyancers acting for the sellers. As soon as the seller becomes market ready, their property can also become ‘contract ready’ at a much earlier stage.
Tech solutions enable easier collaboration
With more Consumer Protection from Unfair Trading Regulations for property information disclosure expected soon, digital solutions, like the mio SIP, ensure CPR compliance and make it easy for conveyancers and estate agents to collaborate together, and initiate the legal process at the earliest stage.
The mio SIP reduces financial risks and time wasting for everyone involved, and helps to create a more assured, expedient property transaction. Sellers can secure a more informed, committed buyer, therefore reducing the likelihood of fall throughs. Transaction times shorten too, ensuring both conveyancers and estate agents see a quicker turnover on pipeline.
Material information disclosure in one place
A comprehensive, digital Property Information Form (PIF) forms the centerpiece of mio’s SIP. It conforms to the standards of the Property Data Trust Framework and is already approved and recognised by the CLC. It’s equivalent to the Law Society’s TA6 and TA10 questionnaires albeit in one form.
The PIF is split into two parts. Part A gathers information regarding disputes and complaints, alterations and changes, notices, specialist issues, fixtures and fittings, utilities and services, insurance, boundaries, rights and informal arrangements, and any other issues affecting the property.
Part B covers legal ownership, legal boundaries, services crossing other property, energy, guarantees, warranties and indemnity insurances, occupiers, as well as completion and moving.
The detailed information provided in the PIF, digitally signed for by the seller, remains very beneficial to any property lawyer as it allows them to identify early any potential problems that may need addressing. The information is readily collated using verified HM Land Registry data and seller disclosure, and provides an easy reference document for the conveyancer.
Land Registry data provides crucial insights
The mio Sellers Information Pack also serves up a Complexity Score powered by Veya, which gives an early indication of the property’s title complexity level. Property professionals can use this indicator to quickly assess the likely intricacies behind the specific transaction. This in turn allows them to correctly allocate the work according to their team members’ expertise and gives them a better opportunity to provide a more accurate legal costs estimate to their client.
A Veya Title Check report, also available in mio, delivers more detailed Land Registry insights to facilitate closer collaboration between conveyancers and estate agents. It helps manage expectations for all parties and makes the transaction smoother as a result. Utilising the Veya insights and solutions, the conveyancer and estate agent can establish a better consultative relationship with their client and will help them prepare the property for conveyancing.
By translating complex title documents into an easy-to-understand format, these insights quickly arm conveyancers with the ability to highlight legal issues and identify potential risks which may delay progress of the sale. It could be, for example, that a simple administrative name correction is required on the title deed. This could knock a weeks off the progression timescale if dealt with proactively while the property is still on the market.
Information exchange strengthens collaboration between conveyancers and estate agents
With many estate agents already introducing upfront material information into their sales process, this creates further opportunity for mutually beneficial, closer collaboration for conveyancers.
Proactive agents who educate and guide their sellers to appreciate the benefits of preparing their property information as soon as the property is marketed, are also likely to 'win' the instruction for their preferred conveyancing partner. This may present referral opportunities, and will make the home moving experience so much better for the client through collaborative conveyancing service. Law firms should consider talking to their estate agency partner network about what they are doing to satisfy material information requirements, and examine how both stakeholders can work better together.
The benefits of early onboarding and collaboration are already proven, as seen in a year-long pilot by award-winning residential conveyancing experts Thomas Legal and specialist search provider Conveyancing Data Services, a part of tmgroup, where transaction times reduced by 40%.
The pilot in England, completed with several offices from a leading, global, independent estate agency, included high-end property sales. Early client onboarding and the collation of all necessary property forms and obtaining search results before an offer on a property was made, saw up to two months shaved off conveyancing times. The time taken from agreed Heads of Terms to Exchange of Contracts was reduced from the national average of 133 days to 80 days.
A positive influence on sales outcomes
There may be some issues raised in the SIP which could affect the seller securing a buyer, or lead to a fall through if not resolved quickly, such as short leases or restrictions which may affect how the buyer can use the property.
Upfront information allows you to give professional consideration to your client and strengthen professional collaboration with their acting estate agent as Product Director at tmgroup and mio, Jon Horton, explains, “With comprehensive property information and an open dialogue between your firm and your estate agent, you can reduce these risks and create valuable efficiencies in terms of time and money for all parties. Increased certainty for the seller leads to better business outcomes, reduced liability, fewer enquiries and less stress for all.”
If you want to find out how tmgroup, CDS and mio can support your business and improve the property transaction end-to-end, please get in touch today.