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How long will it take?
Generally, given that a mortgage is required by the purchaser and
there will be a chain of transactions, 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
approximately 6-10 weeks
from start to finish. However,
many transactions
proceed more quickly and some, more slowly!
How much will it
all cost?
If you are buying,
you need to budget for legal fees and disbursements. "Disbursements"
are payments made by your lawyer to others on your behalf, such
as stamp duty, land registry
fees and search fees. You also need to
budget for lender’s valuation fees and your own survey fee. If you
are selling, you need to budget for estate agent’s fees (average
1.5% plus VAT) and legal fees. In addition, if
you are selling a leasehold property, we
pay a fee on your behalf to obtain management information (for
service charges etc.).
What is a
conveyancing "chain"?
People usually
decide to buy and sell simultaneously, to avoid the cost of owning
two houses.
A number of linked transactions arise, each dependent on
the other and exchange of contracts must take place simultaneously
in all transactions. The result is that the speed of progress is
dictated by the slowest link in the chain, hence the saying “any
chain is only as strong as its weakest link”.
Do I need a survey?
If you are buying a
property you should be aware that the property is "sold as seen". It
is for you, as the buyer, to discover any physical defects by means
of inspections and surveys. A mortgage valuation is not a survey -
it merely ensures that they property is of sufficient value to
protect the lender's interest. We advise you to have at least an
RICS Homebuyer's Report prepared by a qualified surveyor. This will
cost more than a mortgage valuation but it is advisable. It is
possible to go one step further and have a full structural survey
(initially you should not chose this option unless the surveyor who
carries out the Homebuyer's Report thinks any matter should be
investigated further).
How
much deposit will I need?
If
you are buying, the amount of the deposit will usually depend upon
the size of your mortgage.
If it is less than 90% then 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%. The deposit is a matter of negotiation and you can
also usually use any deposit you receive on a sale as part payment
of your deposit on the purchase. Your lawyer can advise you on
the best way of minimising your deposit.
What
searches do you carry out and why?
There are five main categories of search that can be carried out and
the purchaser’s lawyer will decide which of these are necessary
in the particular case:-
Local Authority Search
This uncovers details of the planning history for the property and
whether the Council are aware of any breaches of planning, 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. Very importantly, the search
is against the property only and does not cover the surrounding area
and would not, for example, reveal proposals to develop or extend
neighbouring land or 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
After exchange of contracts, this search checks that nothing has
been added to the Land Registers since office copies were produced.
If there are new mortgages registered against the property that have
not previously been disclosed, the buyers lawyer will obviously
require confirmation that these will be repaid. The search also
'freezes' the Register in the Buyer's favour for 30 days.
Land Charges Search
When you are obtaining a mortgage the lender will ask your lawyer
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
This reveals whether there are any landfill or waste disposal sites
in the area, if the property has been built on an old industrial
site and whether there are any risks from contaminated land, toxic
emissions, flooding, subsidence etc.
Is
there anything I can do to save paying stamp duty?
If
the purchase price is just in excess of the stamp duty limits
(£120,000, £250,000 and £500,000) and the sale includes some
fixtures and fittings eg. carpets, curtains, cooker, fridge, freezer
etc. you may be able to legitimately apportion part of the price
towards the fixtures. The duty will then only be payable on the
amount of the price agreed for the property. For example - If the
agreed sale price is £257,000.00 and there are no fixtures the stamp
duty payable will be £7710, but if there are fixtures worth
£8,000.00 which you agree to purchase separately, the duty will only
be £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 lawyer before exchange
of contracts.
What is the
difference between "exchange" and "completion"?
A completion
date is the date on which you move into your new property and vacate
the old one. The agreed completion date is written into the contract
and exchange of contracts is the point at which the seller and buyer
agree to commit themselves unconditionally to the transaction.
How do I
find out if there are plans to build nearby?
Enquiries can be
made with the local planning office to check whether planning
permission has been granted.
When
do I need to insure the property?
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 before exchange of
contracts as the property will be at risk from the moment you
exchange. 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.
How do I deal
with council tax and water rates?
When you have
exchanged contracts you need to notify the local authorities and the
utility companies that you have sold the property. Similarly you
need to apply for these services at your new property.
Can I let the property?
If you are buying with a mortgage you must get the consent of
the lender before letting your property. If you own a leasehold
property you must check the terms of the lease to make sure that
letting is permitted.
Can I extend
my property?
There may be
restrictions in the title deeds which prevent extensions or require
the consent of another landowner. Larger extensions require local
authority planning permission and you will
also need approval under
the building regulations to complete any structural work. In
designated conservation areas, special planning restrictions apply
which often prevent extensions. You should check these things before
you commit yourself to a purchase.
Can I have
access as the property is empty?
Not
automatically. Contracts normally stipulate that you only get the
keys on the day of completion. If you want to have access to the
property before that date, your lawyer needs to negotiate special
arrangements for you.
Can I stay in
my property after completion?
No. It is a
binding term of the contract that you must vacate on the day of
completion and clear the property of all your furniture and
belongings. If you do not give "vacant possession" the buyer may sue
you for any loss and inconvenience caused.
Do I have any
comeback on my seller once I have moved in?
Because of the
legal doctrine of “caveat emptor” (“Let the buyer beware”), if
things don’t work you will be liable. It is therefore, very
important to check that all appliances, central heating and other
systems are in good working order before you commit to exchange of
contracts. If damage has been caused to the property you may be
entitled to compensation and if the seller leaves furniture or
rubbish at the property he is in breach of contract because "vacant
possession" has not been given.
Who hold
the Deeds to my property?
If you are a seller, your lawyer must apply for the deeds when a
sale of the property is arranged. If you are purchasing a property,
your current mortgage lender may store your new deeds for you as a
form of security. However, in the majority of cases, lenders no
longer store paper deeds and therefore either Fridays can store your
deeds for you in our secure storage facility or, alternatively, we
can return your deeds to you by registered post.
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