Editor's note: This brief was summarised by The Property AI Newsroom from a report by Property Industry Eye. Read the original article for full details.

‘Source of Wealth’ Checks Identified as Major Conveyancing Delay

A recent report has highlighted that 'source of wealth' checks are a significant cause of delays in the UK homebuying and selling process. The article suggests that better collaboration between agents and lawyers could help reduce these delays.

The report notes that, contrary to some public perception, lawyers are not intentionally delaying property transactions. Instead, the most challenging aspect of the process is gathering information and documentation from clients at the outset, such as identification documents and completed forms. Even with electronic processes in place, onboarding a client can take an average of seven days.

The article identifies 'source of wealth' checks as a particular source of friction and delay. Unlike 'source of funds', 'source of wealth' checks require lawyers to verify the origins of money provided by individuals who may not be directly involved in the transaction, such as family members or friends. This process involves reviewing various documents, including bank statements, share certificates, wills, lawyers’ letters, and ISA statements. The need to revisit these checks due to clients’ changing circumstances can further delay transactions, often just before exchange.

The report suggests that if buyers are informed early in the process that anyone providing financial assistance will need to undergo the same checks, and are encouraged to prepare the necessary documentation in advance, it could significantly reduce the time lawyers spend collecting this information. This, in turn, could help speed up property transactions.

The article concludes that improved communication and cooperation between agents and lawyers is key to addressing this issue and reducing delays in the conveyancing process.