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FAQs
If the property is empty and the buyer does not require a mortgage, a sale or purchase can all be completed in a few days but this is very unusual. It is more likely that a mortgage will be required and there will be a chain of transactions. If this is the case, it will usually take 4-6 weeks to exchange contracts and then another 2-4 weeks between exchange of contracts and completion, making a total of 6-10 weeks from start to finish. We always do all that we can to progress your transaction as quickly as possible but we cannot offer any guarantee and you should not believe anyone else that does!
How soon do I need to pay any money?
If you are purchasing a property, your solicitor will usually ask you for approximately £125.00 at the beginning to cover the search fees that will be paid out on your behalf. The balance of the price and the solicitor's costs, etc. will be payable shortly before completion unless you are borrowing more than 90% of the purchase price, in which case it may be required prior to exchange of contracts (see also "How much deposit must I pay"). If you are just selling, you will not need to pay any money in advance. The costs and agents fees will be paid out from the sale proceeds on completion before any balance is sent to you.
If you are obtaining a mortgage, a valuer will inspect the property on behalf of the lender. Although his report will give you an indication as to whether he thinks the property is worth the amount that you have asked to borrow, you will probably not be able to rely on it if things go wrong. For an extra fee, you will usually be offered the option to arrange for the same valuer to carry out a more detailed "Home Buyers Report". This can be relied upon by you so if at a later date you find a problem that is not mentioned in the report you will have some redress against the valuer. If the property is quite old and you are particularly concerned about its condition, you can obtain a full structural survey report which is even more detailed. Always remember the golden rule - "let the buyer beware" so, provided you have not been misled, you will be liable for any problems that you discover after exchange of contracts.
It is normal for a deposit to be paid on exchange of contracts. If you are buying and selling, we can usually use your buyers deposit in connection with your purchase so you will not have to find anything. If you are just buying, the amount of the deposit will usually depend upon the size of your mortgage (if any). If it is less than 90%, you will usually need to find 10% but if you are borrowing more than this, we can often persuade the seller to accept whatever amount you are putting in or even just the amount of our costs and disbursements - only if you are borrowing 100%.
What searches do you carry out and why?
There are five main types of search that can be carried out and the buyer's solicitor will decide which of these are necessary:-
Local Authority Search
This reveals details of the planning history of the property and whether the Council are aware of any breaches of planning. Also, any proposals for new roads or traffic schemes, tree preservation orders, conservation areas and any other matters within the Council's control that may affect the property.
Drainage Search
This will show whether or not the surface and/or foul water drains run into a public or private sewer.
Land Registry Search
This is carried out just before completion in order to find out if there are new mortgages registered against the property that have not previously been disclosed. If there are, the buyers solicitor will obviously require confirmation that these will be repaid.
Land Charges Search
If you are obtaining a mortgage, the lender will ask your solicitor to carry out a search to make sure that are you are not bankrupt! Quite often, this search will show an entry against someone else with a similar name. If so, you will be asked to sign a copy of the result to confirm that it does not relate to you.
Environmental Search
It has more recently been recommended that the buyer's solicitor should also carry out an environmental search to see if there are any landfill or waste disposal sites in the area, if the property has been built on an old industrial site or whether there are any risks from contaminated land, toxic emissions, flooding or subsidence, etc.
Can I exchange contracts before I receive my mortgage offer?
If for any reason the mortgage offer is declined or delayed or it contains any conditions that you cannot comply with, the money may not be available when required so it would be extremely dangerous to exchange contracts without it and any competent solicitor would strongly advise you not to do so.
Is there anything I can do to save paying stamp duty?
Yes, possibly. If the purchase price is just above the stamp duty limits (£125,000.00, £250,000.00 and £500,000.00) and the sale includes some fixtures and fittings (carpets, curtains, cooker, fridge, freezer) you may be able to legitimately apportion part of the price towards the fixtures and the duty will then be payable on the amount of the price agreed for the property only. For example - If the agreed sale price is £258,000.00 and there are no fixtures, the stamp duty payable will be £7740 but if there are fixtures worth £9,000.00, the duty is only £2490 because up to £250,000.00 the level of stamp duty is only 1% but above £250,000.00 it is 3%. If you want to "split" the price in this way, you must remember to tell your solicitor before exchange of contracts.
When do I need to arrange buildings insurance?
Unless the building insurance is being arranged by your lender or it is a leasehold property and the insurance is dealt with by the freeholder, you must arrange buildings insurance from exchange of contracts as the property will be at your risk from that time. The amount of cover should be the estimated cost of re-building the property if it burns to the ground which is not necessarily the same as the current market value. If you had a survey or you are obtaining a mortgage, your surveyor or the lender's valuer will usually have suggested a minimum amount of cover in their report.
What do we need to know if we are buying in joint names?
Most couples who are married or in a stable relationship purchase as "joint tenants" which means that upon the death of one or other of them, that person's half share will automatically pass to the other. The alternative is to hold the property as "tenants in common" which means that each persons half share is treated as being separate so that upon the death of one or other of them his or her share will not automatically go to the other but to whoever it has been left to in the deceased persons will or, if there is no will, to his or her next of kin. If you are putting unequal amounts into the property, the person who is paying the larger amount can and often should be protected by a "trust deed" which sets out your respective shares so that in the event of any dispute or upon the death of one or other of you in the future, your original intentions will be clearly recorded. Once you have considered the above options and/or if you require further advice, you should tell your solicitor so that he or she can make sure that your wishes are carried out.
These are usually left with the estate agents (if any) and the buyer collects them once the money has been paid over on the day of completion. If there are no estate agents (or this is not convenient), the seller will hand them directly to the buyer. Either way, it is important that arrangements are made in advance to prevent the possibility of the buyer having to wait outside with the removal van! Although your solicitor will always try to ensure that everything is finalised as early as possible on the day of completion - and usually this is dealt with by midday - there can sometimes be a delay if, for example, your solicitor is still waiting for the mortgage monies to arrive or there is a particularly long chain. If this happens, please don't panic or become upset because your solicitor will invariably resolve the problem by early afternoon - if not sooner!
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