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Lawyers and Lenders By Owen Hill, Consultant Solicitor

I have just filed papers with the Land Registry to complete a transaction for my favourite client and realised that I probably spent more time dealing with the detailed requirements of the bank

than any other party during the transaction. The seller had appointed a capable lawyer and I received

a comprehensive bundle of contract papers. The only fly in the ointment was a big one. By quirk of ancient history – the property was not a regular freehold but held on a lease for a term of 5,000 years and just to make it really challenging - the original lease was lost while Victoria was our Queen. Damn. I think that most people realise that if they pay a survey

fee to their bank or building society that the resulting report is relied on by the lender. If the loan goes wrong and the valuation advice proves to be wrong then the lender will sue the surveyor for any loss suffered. Fewer people realise that when they use money from a

lender to purchase property that they pay their solicitor for a service that includes the lender getting a Certificate from

the solicitor to the effect that it is safe to lend. The wonders of modern technology are such that the

administration for the posting of solicitors’ certificates to draw down mortgage monies are from call centres that are often not based in the uK and “for security reasons” cannot trust any communication in email. After navigating through the usual call centre menu of

options and getting to the point at which I could judge the quality of the music for those on hold, I began to make more useful calls on my other phone until I got an answer. I explained that all was well but for the fact that is was not a freehold but a lease and the lease was lost. There was a long silence. More music while the matter was referred to a supervisor and then the promise of a call back later. It was resolved eventually but I tell the tale because you

now know why, when you ask for a quote for any property work from a solicitor, you will be asked if there will be a lender involved. There normally is but if there is not – just listen carefully and you will often hear an involuntary sigh of relief usually in the form of the word “hallelujah”.

A gift to remember By Marinella Hollies, Associate Solicitor

When talking to a client about his or her Will, I often discuss the option of a charitable gift. A recent trial has suggested that three times as many Britons would

leave a gift to a charity that they are passionate about in their Will if they were reminded by their solicitor to consider it. The six-month project, which looked at 1,000 new Wills,

was conducted by the Cabinet Office behavioural insights team. It showed that when solicitors told clients that leaving a gift to charity was an option, the percentage that did so rose from 5 to 10%. When clients were asked if there were any charities that they were passionate about, giving rose again to 15%. During the trial an additional £1m of gifts was left to charities in Wills. Director of Remember A Charity, Rob Cope, said the

increase is due to the fact that significant numbers of people support the idea of leaving a gift to charity but few remember to do so when it comes to writing their Will. He said that gifts in Wills bring in £2bn a year for uK

charities - 13% of all charitable donations: “A trebling in the number of people leaving a gift could have a significant financial impact for good causes.” Minister for Civil society Nick Hurd said: “We are working

with partners to see how we can make it easier and more compelling to give. This study shows how generous people are prepared to be, if asked in the right way.” One such incentive has been in place for the last 18

months. If your estate is worth over £325,000 (as at 2013) when you die, Inheritance Tax may be payable. From 6 April

2012, if you leave 10 per cent of your net estate to one or more qualifying charities, the tax due may be paid at a reduced rate of 36 per cent instead of 40 per cent. This can represent a considerable saving. The gift must be drafted in a specific way to be acceptable to the revenue and it is a good idea to take legal advice to be certain that your estate will benefit from this concession. Gifting by Will is essential for many charities and good causes.

You may believe that disputes over money left to charities are the exception, but the reality is sadly very different. The number of Wills being challenged by relatives who feel

that charities have been left too much money has trebled over the past few years. One reason for this is that the wealth of the over-50s — the

baby boomers — has soared thanks to rising property prices. Many have failed to update their Wills to take into account the increased value of their home, so residual gifts left to charities often end up being far more substantial than the legacies bequeathed to loved ones. The emotional cost of resolving this type of dispute can be

considerable and the legal costs can dramatically reduce, if not extinguish, an estate. It is important that your intentions are clear when you make your Will so that it is less likely it will be challenged. The best way to achieve this is by talking your wishes through with your solicitor. Your wishes should be exactly that - your wishes - and to be

certain that they are fulfilled, it is all the more important for you to review your Will regularly and to ask your solicitor to do a ‘health check’ of the terms of your Will especially where the value of your assets has changed.


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