Conveyancing in London – avoiding a trap for the unwary

A trap may lie in wait for buyers when Conveyancing in London if the seller has owned the property for less than five years.

If a previous owner transferred the house to someone else at an undervalue within the previous five years, then if that then person goes bankrupt, their trustee in bankruptcy could reclaim the property under certain circumstances. That could lead to the buyers losing their home, so Conveyancing Solicitors obviously take pains to ensure that cannot happen.

In October, Property Lawyer Gemma Farguson carried out the Conveyancing in London for Mr and Mrs R on the purchase of a freehold house on High Street South, East Ham, London, E6. The clients had found the property through the local Haarts branch at 219 High Street North, East Ham, London, E6 1JG.

The Conveyancing Solicitors carrying out the Conveyancing in London for the sellers were R R Sanghvi and Co of 176 Northolt Road, London HA2 0NP.

Within a day of receiving instructions Gemma had received the draft contract and a copy of the land registry title from them. She immediately put in hand the local conveyancing search with the London Borough of Newham, Land Charges Manager, 1st Floor West Wing, Newham Dockside, 1000 Dockside Road, London E16 2QU.

As she had received a copy of the sellers' land title, Gemma was able to see that the sellers had purchased within the last five years. As prices are now recorded in the title register, she was able to check whether the price that the sellers had first paid for the house was consistent with market values at that time.

Had the sellers purchased for full market value?

Since Conveyancing Solicitors are not experts on property values, she also raised a query with the other side as to whether their clients had purchased for full market value. Confirmation was received that the vendors had purchased 'at arms length' and there was no question of  any previous transaction being set aside because of a bankruptcy.

Had that not been the case then further enquiries would have to have been made, and a suitable indemnity insurance policy would have be required as part of Conveyancing in London  to protect the buyers and their mortgage lender against potential loss.

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