Electronic Signatures and HM Land Registry – what lenders need to know

Prior to the Covid-19 outbreak, documents submitted to HM Land Registry had to be signed manually in wet ink.

The effect of the Covid-19 outbreak has accelerated HM Land Registry efforts to accept documents for registration that have been signed electronically.

The “Mercury signing” method

From 4 May 2020 HM Land Registry accept deeds that have been signed using the “Mercury signing approach”.

Those deeds which can be mercury signed applicable to transactions we deal with are as follows (parties must be represented by a conveyancer):

• A deed that effects one of the dispositions referred to in section 27 (2) and (3) of the LRA 2002 (those that are required to be completed by registration)
• A discharge or release in form DS1 or DS3

The following steps will need to be taken in respect of remortgages and transfers of equity:

1. Each party prints the signature page.
2. Each party then signs the signature page in the physical presence of witness.
3. The witness signs the signature page.
4. Each party sends a single email to their conveyancer attaching the final agreed copy of the document and the signed signature page.
5. Post completion, the conveyancer applies to register the disposition and includes with the application, the final agreed copy of the document. The conveyancer must ensure that they certify the resulting document  as a true copy of the original.
6. The application is then processed by HM Land Registry.

The witnessed electronic signature method

From the 27 July 2020, HM Land Registry now also accept registration of transfers and certain other deeds that have been electronically signed subject to certain requirements. Please see below the following steps from HMLR which should be taken to provide you with an insight as to how this will be dealt with in practice:

1. All parties must agree to the use of electronic signatures and an electronic signing platform in relation to the deed.
2. With certain exceptions, all of the parties have conveyancers acting for them.
3. The conveyancer is responsible for setting up and controlling the signing process through the platform.
4. The conveyancer who lodges the application does so by electronic means and includes with the application, the completed deed.
5. The conveyancer lodging the application provides a certificate, certifying that the requirements in respect of the execution of deeds using electronic signatures has been satisfied.

HM Land Registry have further commented on the use of the electronic signing platform, and unfortunately they cannot provide any recommendations in this regard, but we have received assurance that they have been liaising with a number of providers, to ensure that their service meets the requirements.

The future of electronic signatures

The use of the methods referred to above, should ensure that transactions run a lot more smoothly and efficiently specifically in the current climate and in line with social distancing rules.

HM Land Registry have, however, advised that the methods will still be in place once the pandemic is over, COVID-19 has simply accelerated this new procedure.

Get in touch

If you would like to discuss any of the contents of this update, please contact Thomas Lillie or Ashleigh Barratt.