Completion and post-completion steps - Notifying relevant pa...

Learning Outcomes

This article outlines the completion and post-completion steps in conveyancing, focusing on what SQE1 candidates need to know to protect a buyer’s title and a lender’s security. It explains how to manage completion mechanics, including use of the Code for Completion by Post, giving and enforcing undertakings, redeeming existing mortgages from sale proceeds, and obtaining acceptable evidence of discharge (DS1, DS3, DS2 and electronic notifications). It covers who must be notified at and after completion (clients, lenders, estate agents, landlords and managing agents, authorities and service providers), what information should be provided, and how to coordinate communications in chain transactions. It reviews the requirements for registration of transfers and charges at HM Land Registry and, where relevant, Companies House, including correct use of OS1/OS2 priority searches, observance of the priority period, and SDLT/LTT filing and certification as a precondition to registration. It examines leasehold-specific post-completion steps such as service of notices of transfer and charge, deeds of covenant, and management company share or membership formalities. It analyzes the legal and professional consequences of late, incorrect, or missing notifications and registrations, including loss of priority, void or defective security, breach of trust or undertaking, negligence, and professional misconduct.

SQE1 Syllabus

For SQE1, you are required to understand the completion and post-completion steps in conveyancing, including notifying relevant parties, discharging existing mortgages, and registering title and charges, with a focus on the following syllabus points:

• The steps required to notify parties (including lenders, clients, agents, landlords/managing agents, and authorities) at completion and after completion.
• The procedures for discharging existing mortgages and providing evidence of discharge.
• The requirements for registration of title and charges at HM Land Registry and Companies House.
• The importance of timely communication and documentation to ensure a valid transfer of legal title and compliance with lender and regulatory requirements.
• Use of pre-completion priority searches (OS1 for whole, OS2 where dealing with part) and effect of the priority period.
• SDLT/LTT filing deadlines and certificates required before registration can proceed.
• Leasehold-specific post-completion notices (notice of transfer, notice of charge) and any deed of covenant or share/ membership formalities.
• Professional conduct issues in conveyancing, especially undertakings, completion by post, and managing fraud risk.

Test Your Knowledge

Attempt these questions before reading this article. If you find some difficult or cannot remember the answers, remember to look more closely at that area during your revision.

1. What evidence must a buyer’s solicitor obtain to confirm that the seller’s mortgage has been discharged after completion?
2. Who must be notified after completion of a property purchase, and what documents are typically required for registration?
3. What are the consequences if the buyer’s solicitor fails to register the transfer of title within the priority period?
4. When acting for a lender, what steps must you take to ensure the lender’s charge is properly protected post-completion?

Introduction

Completion and post-completion are critical stages in a property transaction. At completion, legal title is transferred, funds are settled, and keys are released. Post-completion, solicitors must notify all relevant parties, discharge any existing mortgages, and register the new owner’s title and any new charges. For registered land, priority is secured by an OS search and must be used within the 30 working day priority period; for unregistered land, first registration must be made promptly with full title evidence. SDLT (or LTT in Wales) must be filed by the statutory deadline and a certificate lodged with HM Land Registry. Failing to complete these steps correctly can lead to serious legal and financial consequences for clients and solicitors, including loss of priority, defects in the lender’s security, exposure to breach of trust or breach of undertaking, and professional misconduct issues.

Key Term: completion
The stage in a property transaction when the legal title passes from seller to buyer, funds are settled, and the buyer is entitled to take possession.

Key Term: undertaking
A binding promise, usually given by a solicitor, to carry out a specific act (such as redeeming a mortgage) within a specified time.

Key Term: discharge of mortgage
The process by which a lender confirms that a mortgage has been repaid in full, usually evidenced by a DS1 form, a DS3 for part release, or electronic notification to HM Land Registry.

Completion: Notifying Parties and Discharging Mortgages

At completion, the buyer’s solicitor transfers the purchase funds to the seller’s solicitor, who in turn authorises the release of keys and hands over the executed transfer deed. If the property is subject to a mortgage, the seller’s solicitor must use part of the sale proceeds to redeem the mortgage and provide an undertaking to the buyer’s solicitor to obtain evidence of discharge. Where proceeds are insufficient to fully redeem, this must be resolved before exchange: either the seller contributes additional funds or the seller’s lender agrees in advance to discharge on the terms of the sale. Without such arrangements, completion may fail, risking breach of contract and chain collapse.

The completion mechanics are typically governed by professional codes and contract provisions. The Code for Completion by Post requires solicitors to hold completion funds on trust and to use them only for a genuine completion. The seller’s solicitor’s undertaking must be clear, precise, and limited to matters they can control, such as redeeming the identified charge and procuring discharge evidence. Giving an imprecise or unachievable undertaking may expose the solicitor to regulatory action and civil liability.

Where multiple charges exist, each lender must be redeemed in correct priority. If the seller’s lender is represented by its own conveyancer, they may provide an electronic notification of discharge directly to HM Land Registry. If not, a signed DS1/DS3 deed of release may be provided, sometimes accompanied by a DS2 to facilitate registration where the lender is not represented by a conveyancer. These arrangements must be agreed and diarised pre-completion.

Key Term: undertaking
A binding promise, usually given by a solicitor, to carry out a specific act (such as redeeming a mortgage) within a specified time.

Notifying the Lender and Other Parties

If the buyer is purchasing with a mortgage, the lender must be notified that completion has taken place. The buyer’s solicitor will date the mortgage deed and ensure the lender’s charge is registered at HM Land Registry. Lenders usually expect to receive a post-completion report with confirmation of completion, details of the registered title application, and updated title when registration completes. The seller’s lender must also be notified that the mortgage has been redeemed, and the lender will provide evidence of discharge. In commercial transactions, if an electronic discharge is anticipated, ensure that appropriate confirmation is obtained from the lender (via an authorised representative) that it will be submitted promptly after completion.

Other parties to notify at completion include:

• The estate agent (to confirm completion and authorise key release).
• The client (to confirm completion and next steps).
• Any occupiers or tenants (if applicable), ensuring vacant possession if contracted.
• In leasehold matters, any landlord/managing agent where immediate notice is required by the lease after completion.

Where completion occurs in a chain, solicitors often use standard completion formulae and undertakings to synchronise releases of funds and keys. Failure to synchronise may result in negligence claims, particularly in residential chains.

Worked Example 1.1

A buyer’s solicitor receives confirmation that completion funds have been received by the seller’s solicitor. The property is subject to an existing mortgage. What must the seller’s solicitor do to ensure the buyer receives clear title?

Answer:
The seller’s solicitor must use the completion funds to redeem the existing mortgage and provide an undertaking to the buyer’s solicitor to obtain and send evidence of discharge (such as a DS1 form or electronic discharge confirmation) as soon as it is received from the lender.

Post-Completion: Registration and Notifications

After completion, the buyer’s solicitor must take several steps to protect the client’s legal title and the lender’s security. These include registering the transfer at HM Land Registry, registering any new charge, and notifying relevant parties. Where the property is unregistered, an application for first registration must be made, supplying all title evidence, searches, and the transfer. For registered titles, an AP1 application supported by the OS1/OS2 priority search ensures priority over later entries within the 30 working day period. If time is tight, a fresh priority search can be obtained before the prior one expires, but the application should be submitted promptly to avoid loss of priority.

Key Term: registration
The process of recording a change of ownership or a new charge at HM Land Registry to give legal effect and public notice of the transaction.

Key Term: priority period
The period (usually 30 working days) during which the buyer’s application to register a transfer or charge at HM Land Registry has priority over any subsequent applications.

Key Term: DS1 form
The standard Land Registry form used to confirm the discharge of a registered charge (mortgage) over a property.

Steps for Registration

• Prepare and submit the AP1 application to HM Land Registry within the priority period obtained from the pre-completion search (OS1 for whole; OS2 where dealing with part). Check that the application covers both transfer and charge (if applicable).
• Include required documents: the executed transfer deed (e.g., TR1/TP1), the SDLT5 certificate from HMRC (or LTT certificate in Wales), the mortgage deed (if applicable), and evidence of discharge of any existing mortgage (DS1, DS3 for part discharge, or electronic discharge).
• Pay the Land Registry fee and ensure all documents are properly executed and dated. If the buyer is a company and a mortgage has been granted, register the charge at Companies House within 21 days of completion; failure to do so renders the charge void as against a liquidator and creditors until late registration is ordered by the court. Coordinate with the lender as many lenders require confirmation of Companies House registration.
• For unregistered land, submit an FR1 for first registration with an indexed list of title documents (on form DL), copies of pre-contract searches, the contract, the transfer, discharged seller’s mortgage, SDLT/LTT certificate, and any DI form identifying overriding interests to be noted on the register. HM Land Registry will allocate an appropriate class of title and issue official copies of the registered title when complete.

Where delays arise (e.g., requisitions from HM Land Registry), respond promptly and accurately. Consider using HM Land Registry’s expedite process where necessary (for mortgage expiry deadlines, lender requirements, or other urgent reasons) with appropriate evidence.

Notifying Other Authorities and Service Providers

After completion, the following parties should be notified:

• Local authority (for council tax and electoral roll purposes) and any relevant rates authorities in commercial cases.
• Utility companies to transfer accounts for gas, electricity, water, and telecommunications, ensuring meter readings are recorded.
• Insurers to update or initiate property insurance in the buyer’s name and to alter lender’s interest clauses as needed.
• For leasehold properties, serve notice of transfer and notice of charge on the landlord/managing agent in accordance with the lease (including prescribed fees). Where required, complete any deed of covenant in favour of the landlord or management company, deliver share transfer forms for any residents’ management company, and obtain updated membership certificates.

Lenders commonly require confirmation that leasehold notices have been served (to ensure the lender’s charge binds the landlord’s reversion and is recognised in management records). Failure to serve notices can lead to breach of lease and create enforcement risks for both the owner and lender.

Worked Example 1.2

A buyer’s solicitor completes the purchase of a property with the aid of a mortgage. What documents must be submitted to HM Land Registry, and what is the consequence of missing the priority period?

Answer:
The solicitor must submit the AP1 form, the executed transfer deed, the SDLT5 certificate (or LTT certificate), the mortgage deed, and evidence of discharge of any existing mortgage. If the application is not made within the priority period, the buyer risks losing priority, and another party could register an interest against the property before the buyer’s application is completed.

Worked Example 1.3

After completion, the seller’s solicitor is slow to provide evidence of discharge of the seller’s mortgage. What should the buyer’s solicitor do?

Answer:
The buyer’s solicitor should remind the seller’s solicitor of their undertaking and request prompt delivery of the DS1 or electronic discharge confirmation. If there is a significant delay, the buyer’s solicitor should escalate, including chasing the lender directly (through appropriate channels), considering protective steps with HM Land Registry, and, in persistent non-compliance, reporting an undertaking breach to the regulator.

Evidence of Discharge and Lender Protection

The buyer’s solicitor must ensure that any existing mortgage has been properly discharged. This is usually evidenced by a DS1 form (full discharge) or DS3 (partial discharge) or electronic notification from the lender to HM Land Registry. In some cases, a DS2 may accompany the discharge where the lender is not represented by a conveyancer. The buyer’s solicitor should not rely solely on the seller’s undertaking and must follow up to obtain evidence of discharge. Registering a transfer while leaving a prior charge unreleased can result in a title showing the buyer’s ownership subject to an old charge, undermining clean title and the new lender’s security.

Where acting for a lender, the buyer’s solicitor has additional duties under the UK Finance Mortgage Lenders’ Handbook and any specific lender instructions. These typically include:

• Ensuring the charge is correctly executed, dated on completion, and lodged for registration with the transfer.
• Confirming priority by OS search and timely AP1 submission.
• Obtaining and lodging evidence of discharge of any prior charges to secure the lender’s intended first legal charge (or specified priority).
• Reporting any issues (such as adverse entries, restrictive covenants, or defects revealed by post-completion requisitions) to the lender promptly.

In commercial transactions, discharge may be by electronic notification. Because electronic discharge is sent post-completion, confirm with the seller’s bank that it will be issued promptly and consider including discharge mechanics in the contract (e.g., identifying the lender’s conveyancer and the form of discharge to be supplied).

Key Term: evidence of discharge
Documentary proof (such as a DS1 form or electronic confirmation) that a mortgage or charge has been repaid and removed from the register.

Worked Example 1.4

You act for a company buyer granting a mortgage to a bank. Completion has occurred. What additional post-completion step (beyond HM Land Registry registration) must be taken, and what is the consequence of failing to do so in time?

Answer:
The company must register the charge at Companies House within 21 days of completion under the Companies Act 2006. Failure to register on time renders the charge void against a liquidator and creditors until late registration is ordered by the court; the lender may require immediate remedial action and the borrower may face costs and risk to funding.

Worked Example 1.5

You complete a leasehold flat purchase with a mortgage. The lease requires notice of transfer and notice of charge within 14 days, and a deed of covenant with the landlord. What must be done and why?

Answer:
Serve notice of transfer and notice of charge on the landlord/managing agent with any required fees, and complete and deliver the deed of covenant. This ensures compliance with lease terms and ensures the lender’s charge is recognised by the landlord and management records, protecting enforceability and avoiding breach of lease.

Communication and Compliance

Timely and accurate communication is essential throughout completion and post-completion. Solicitors must keep clients, lenders, and other parties informed at each stage, and ensure all undertakings are fulfilled. Confirm completion to the client, outline the timetable for SDLT/LTT filing and registration, and explain when official copies of the register are expected. When registration completes, send the client and lender official copies and confirm that entries match expectations (buyer as registered proprietor, lender’s charge correctly registered, all prior charges removed, and any agreed restrictions or notices correctly entered).

Professional conduct duties underpin these steps:

• Undertakings must be honoured promptly and precisely. If circumstances change and an undertaking cannot be fulfilled, seek consent to vary and, if necessary, notify affected parties without delay.
• Funds received from clients for completion are held on trust to be used only for genuine completion. If completion is discovered to be fraudulent (e.g., an impostor seller), using those funds amounts to breach of trust even if there was no negligence. Manage fraud risk through robust identity checks, vigilance over red flags, and appropriate reliance on updated professional codes and protocols.
• Confidentiality and conflicts must be managed. Acting for both buyer and seller in the same conveyance is generally prohibited; ensure clear client authority and avoid breach of warranty of authority. Notify lenders and other parties strictly within the scope of client consent.

Failing to notify parties or complete post-completion steps can result in loss of legal title priority, financial penalties, lender withdrawal, breach of lease, or professional misconduct. Diarise all critical deadlines: SDLT/LTT filing (usually 14 days post-completion), Companies House charge registration (21 days), and the OS priority period (30 working days). Where delays are unavoidable, communicate early with all stakeholders and seek extensions or expedites as appropriate.

Exam Warning

Failing to register the transfer or charge within the priority period can result in loss of priority, meaning another party could register an interest before your client. Also, missing the 21-day Companies House deadline for a company’s charge renders the lender’s security void against a liquidator and creditors until remedied by court order. Always diarise these deadlines and submit applications promptly.

Revision Tip

After completion, always check the updated title register to confirm that your client is shown as the registered proprietor and that any new charge is correctly registered. For leaseholds, confirm that notices of transfer and charge have been served and acknowledged, and that any deed of covenant and membership formalities have been completed. For company borrowers, obtain confirmation of Companies House charge registration.

Key Point Checklist

This article has covered the following key knowledge points:

• Completion is when legal title passes, funds are settled, and keys are released.
• The seller’s solicitor must redeem any existing mortgage and provide evidence of discharge.
• Electronic discharge, DS1 (full) and DS3 (partial) are acceptable forms of discharge evidence; obtain promptly under an undertaking.
• The buyer’s solicitor must register the transfer and any new charge at HM Land Registry within the priority period secured by OS1/OS2.
• SDLT/LTT must be filed by the statutory deadline and the certificate lodged with HM Land Registry.
• For company buyers, register the charge at Companies House within 21 days to protect lender security.
• Leasehold purchases require prompt service of notices of transfer and charge and completion of any deed of covenant or membership steps.
• Notification of completion must be given to clients, lenders, agents, and authorities; maintain clear communication and records.
• Failure to complete post-completion steps can result in loss of title priority, void security, breach of lease, financial penalties, or professional misconduct.

Key Terms and Concepts

• completion
• undertaking
• discharge of mortgage
• registration
• priority period
• DS1 form
• evidence of discharge