What is an engrossment fee? – Jargon Buster

• Posted onFebruary 28, 2023

Lisa Hope shares some legal jargon-busting knowledge around engrossment fees.

In essence, an engrossment fee is a fee charged by a conveyancing firm for producing a fair copy or an ‘engrossment’ of a legal document, such as a Lease or a Transfer Deed, for signature by the parties.  The fee can also be called a ‘document fee’.

Why is a document fee charged?

When a conveyancing transaction requires a legal document to be prepared, it is usual for one party’s conveyancer to draw up a draft first. This is then sent to the other side’s conveyancer for approval. The draft may be amended, and sometimes a draft document will pass backward and forward several times before all the wording is finally agreed upon.

In the past, this process could become costly if you need to photocopy and post several versions of the amended document back and forth or even hand-write or type documents.  As such, it was commonplace to charge an engrossment fee to cover this cost.

When is an engrossment fee charged?

With the advent of standard form documents and communications, which are sent electronically, it could be argued that an engrossment fee is no longer relevant to property transactions today. It is true that in most cases, an engrossment fee is not charged.  However, it is still commonplace to see an engrossment fee charged by a conveyancer acting for a developer in respect of the sale of a new build property.  The fee is usually passed on to the buyer of the property.

Is it an essential fee to pay when buying a new build property?

The developer’s conveyancer will usually draft the Contract for the sale of the property to include a reference to the engrossment fee.  Once you have exchanged contracts, you will be legally bound to pay the fee as you will at that point have agreed to all of the terms of the contract, which includes payment of the engrossment fee.  If you wish to object to the payment of the fee, you will need to do so prior to the exchange of contracts.  It is unlikely that the developer would agree to waive the fee but you can always try!

When is the engrossment fee payable?

Assuming you have been unsuccessful in getting the developer to waive the engrossment fee, you will pay this on the day of completion of your purchase.   Your conveyancer will arrange payment at the same time as the purchase price is paid to the developer’s conveyancer.

How much is an engrossment fee?

The fees can vary depending on the developer but are typically in the region of £100-£200.

If you’re looking for support with residential conveyancing matters and would like legal advice, please contact your local WSP Solicitors office in Gloucester, or Stroud. You can also call us on 01453 847200