Whether you are buying or selling a property, it is likely that there will be a mortgage lender involved in the transaction. It is vital that your conveyancing solicitor ensures the availability of your mortgage monies on time (and the repayment of any mortgage on time).
Your mortgage when selling
As part of your conveyancing quote, your conveyancing solicitor will handle the repayment of your mortgage from the net proceeds (or before exchange of contracts they will have obtained from you the necessary funds for any excess payment if you are in negative equity) by following these steps:
- As early as possible and well before exchange of contracts they will – with your consent – obtain a repayment amount from your lender and seek your consent to it’s amount.
- As soon you have exchanged contracts, they will obtain a final statement calculated to the completion date.
- On the day of completion, they will arrange a bank transfer of the required amount direct to the lender, quoting your mortgage account number.
If you have overpaid – as part of your monthly mortgage instalment – beyond the date of completion, and money is due back, then this will come to you. However, you should not cancel any mortgage payments before completion, and the lender’s statements will invariably assume you will be paying it as part of their total statement.
Your mortgage when purchasing
Again, your conveyancing solicitor will take charge of requesting the mortgage money to be sent to them for onward sending to your seller’s conveyancer on the day of completion. They will request the money after exchange of contracts, and almost universally – to avoid delay on the day of completion – your conveyancing solicitor will obtain the mortgage money the previous working day.
Consequently, when you are purchasing a property you need to play your part so as not to frustrate your conveyancer’s ability to request the mortgage money – as this can lead you into a breach of contract for late completion – by ensuring that any previous requirements imposed on you by the lender are met as early as possible (e.g. returning signed direct debit mandates, or the signed acceptance of the offer) and that you have provided all the information that your lender requires.
During the course of the legal conveyancing, if you have any queries or concerns regarding your mortgage you should consult your mortgage broker, and if they threaten the mortgage or are likely to cause delay, you should advise your conveyancer.