What role does a conveyancing solicitor play when selling a house with a mortgage?

A conveyancing solicitor’s role is to make sure the legal transfer of a mortgaged property can take place and that the lender’s rights are dealt with correctly. They coordinate the paperwork between you, the buyer, the buyer’s legal representative and the mortgage provider, while checking that the proposed sale complies with the title and contract requirements.

Checking your authority to sell

The solicitor checks the property title, confirms who is entitled to sell and identifies any restrictions, notices or other charges affecting the property. A mortgage is normally recorded as a charge on the title, but there may also be second charges, secured loans, restrictions imposed by a management company or other matters that need resolving before completion.

They will usually ask you to complete property information forms and provide details of alterations, guarantees, boundaries, disputes and utilities. If the property is leasehold, further information may be needed about the lease, service charges, ground rent, buildings insurance and the managing agent. Missing or incomplete information can lead to additional enquiries from the buyer’s solicitor and may delay exchange.

Preparing and negotiating the legal contract

Your solicitor prepares the contract package, which generally includes the draft contract, title documents, property forms and relevant certificates. They answer legitimate legal enquiries raised by the buyer’s solicitor and correct inaccuracies in the title or supporting paperwork where possible.

The solicitor also checks the proposed completion date against the mortgage position. The sale contract should allow enough time for the lender’s figures and any required undertakings or consents to be dealt with. You should not treat an agreed price as the amount you will receive, because mortgage interest, an early repayment charge, legal costs, estate agency fees and other sums may be deducted.

Obtaining and checking mortgage information

The solicitor requests the information needed to close the mortgage account. This can include the amount required to redeem the loan, the date on which that figure applies, daily interest, any early repayment charge and the lender’s instructions for releasing its security.

Redemption figures are date-specific. If completion takes place on a different date, an updated figure may be required. The solicitor checks that the expected sale proceeds are sufficient to meet the lender’s demand and the other completion payments. If they are not, you will generally need to provide the shortfall or agree a separate arrangement with the lender before completion can proceed.

Managing exchange and completion

Before exchange, your solicitor confirms that the contract is acceptable, the buyer has raised no unresolved legal issue that prevents exchange and the completion arrangements are clear. Exchange makes the contract legally binding, so you should not commit to a related purchase, removal arrangement or alternative accommodation on the assumption that the sale will happen until your solicitor confirms exchange.

On completion, the buyer’s solicitor sends the purchase money. Your solicitor then applies the funds in the required order, including the mortgage redemption and other agreed payments, and accounts to you for any remaining balance. They arrange for the transfer to be dated and released, deal with the lender’s discharge of its charge and send any balance due to you. The buyer’s solicitor subsequently registers the buyer’s ownership.

Dealing with complications

A solicitor can identify legal issues that may affect whether the sale is mortgageable or capable of registration. Examples include:

• an undisclosed secured loan or restriction on the title;
• missing planning permission, building regulations approval or completion certificates;
• unresolved boundary disputes or rights of way;
• leasehold arrears, permission requirements or an unexpired lease term that concerns the buyer’s lender;
• differences between the legal owner named on the title and the person giving instructions; and
• probate, divorce, bankruptcy or power-of-attorney issues affecting the right to sell.

Where a problem cannot be corrected before completion, the buyer’s solicitor may require an undertaking, a deed, an indemnity policy or a retention of funds. Whether any of these solutions is appropriate depends on the specific legal and lending risk.

What the solicitor does not decide

The solicitor does not set the property’s market value, choose the buyer or determine whether selling is financially sensible. They can explain the legal and financial information available to them, but advice on personal taxation, benefits or wider debt management may require an accountant, financial adviser or specialist debt adviser.

They also cannot usually waive a mortgage lender’s early repayment charge or agree to accept less than the amount required to redeem the loan. Those decisions belong to the lender. The solicitor’s role is to obtain the relevant terms, explain how they affect completion and make sure the agreed arrangements are documented.

Information to give your solicitor

At the outset, provide your mortgage account details, details of any other borrowing secured against the property, identification documents, title information in your possession and copies of guarantees or certificates for work carried out. Tell the solicitor about any change in ownership, relationship breakdown, arrears, court order, insolvency issue or proposed change to the sale terms. Early disclosure gives them a better opportunity to resolve issues before they affect exchange.

When comparing conveyancing quotes, check whether the fee includes acting on the mortgage redemption, dealing with leasehold information, bank transfer charges, lender administration requirements and work arising from title defects. A low headline fee may not include every item needed for a mortgaged sale.

In practical terms, the solicitor provides the legal control point for the transaction: they verify the title, prepare and negotiate the contract, coordinate the lender’s requirements, calculate the sums needed for completion and complete the transfer in accordance with the contract. Their work is complete only when the sale proceeds have been accounted for and the mortgage charge has been dealt with properly.