Conveyancing disbursements are part and parcel of buying and selling property, although you won’t have to pay as many if you are selling. They are fees that your conveyancer has to pay to third parties on your behalf and include things such as searches and stamp duty. This guide covers everything you need to know about conveyancing disbursements.
On average, property searches cost between £250 and £450. You can usually buy a search package encompassing local authority, water and drainage, and environmental searches.
Local Authority Search
This is one of the main conveyancing searches regarding purchases. The local authority search will give you vital information about the property, such as if it is a listed building located in a conservation or tree preservation area.
The local authority search will also provide information on the following:
Water and Drainage Search
Every purchase must include a water and drainage search. This search will identify if the property is connected to the sewer and public water systems and how the property is charged for its water supply.
These types of searches will provide a risk assessment surrounding certain environmental matters that may affect the property and are carried out by specialist companies. They will report on any recognised environmental issues that may affect the property. Such searches are recommended on property close to industrial areas or where industry has taken place in the past.
Stamp Duty Land Tax (SDLT) is payable on most residential property purchases. From 1st October 2021, the SDLT threshold when Stamp Duty becomes payable is £125,000. There are tax reliefs for first-time buyers who will not have to pay any Stamp Duty on property up to the value of £300,000.
Standard rates of Stamp Duty range between 0% for property priced under the threshold as detailed above and first-time buyers, and 12%. The Land Registry will not complete registration of a property transfer until Stamp Duty has been paid. There are fines and penalties for Stamp Duty not paid within 14 days from the date of completion.
The conveyancer will undertake a search of the Land Registry after exchanging contracts to check the property register has not been changed since the seller’s conveyancer issued the pre-contract paperwork. When buying a home, the buyer’s conveyancer will receive a copy of the seller’s title before contracts are exchanged. Immediately prior to final completion, the buyer’s conveyancer will ask the Land Registry to check there have been no changes, such as a notice of the seller’s bankruptcy or new mortgage, since the copy title was first issued. This ensures the seller remains entitled to sell.
This search generally costs around £3, and because it is so small, many conveyancers do not collect this fee upfront.
Your mortgage provider will need a bankruptcy search carried out on all the people who will be named as a borrower on the mortgage offer. This costs £2 per name. Again, this fee is generally not collected upfront.
After completion, the change of ownership must be registered, together with details of the new mortgage on the property.
These checks verify identity and may be undertaken by online companies. The cost of such checks is between £6 and £20. Those who live abroad or who are foreign nationals should expect to pay extra because of the additional checks that need to be done.
Several other disbursements may also be payable depending on the type and location of the property. These include:
Because an ordinary local search only provides details of planning matters for the property being purchased, if a buyer wants further information about any planning consents or applications on property nearby, or details of local planning zoning, this search can be made.
This is recommended for those properties that are in areas with high flood potential, whether that is from sea, river or another source.
For properties in locations where coal deposits are known to prevail, whether or not there is evidence of any mining, this search is recommended. And will identify whether there are any records of old mines in the location, as well as details of previous subsidence claims. Homes in Cheshire, for example, may require a search to determine whether a property is affected by brine (salt) pumping operations.
In some parts of Devon and Cornwall, tin and other metals have been mined. This search can ascertain if a property may be affected. Stone and other metal ores have been mined in several other parts of the UK, therefore it may be sensible to get a report if a property is situated in one of these areas.
There are some properties that may be liable to have to contribute to the cost of repairing their local parish church. Previously, such liability did not have to be logged on a property’s register, so it has been necessary to make a separate search to identify any potential liability. However, from October 2013, any chancel repair liability must be registered with the Land Registry. This means that a separate search will only be required if the title is unregistered.
If you are buying a flat or other type of leasehold property, fees may be payable to the freeholder or their agents for registering details of the change of ownership and your mortgage, if you have one.
Sellers do not have to pay as many conveyancing disbursements as buyers, but the following are required when selling a property:
You conveyancer will need to get documents from the Land Registry to prove you are the official owner. They comprise a property register and a plan of the property. At the time of writing, the fee for this is £6.
If you have a mortgage on the property you are selling, your conveyancer will be required to pay it off to complete the sale. They will also transfer any remainder sale proceeds to you. The Bank Transfer Fee will be charged to process those payments and can be anything between £24 and £45.
With searches, the relevant authority tends to require payment upfront before they process the search application. There are some disbursements that are payable during the transaction and others at the end. It is important to understand that disbursements do not form part of your conveyancer’s costs or charges, but because they are generally paid via your conveyancer, you should ensure, when getting a conveyancing quote, that the disbursements are mentioned.
You should get a clear explanation from the start what costs are payable if your sale falls through. Some online conveyancers offer a “no sale, no fee” guarantee, which means if the worst happens, you will not have to pay the full conveyancing bill, although disbursements will always need to be paid.
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