Frequently Asked Questions
We have set out below some common questions
and answers which may assist you. If we have not answered
your query below, or if you require further clarification on any of
these matters, please contact Joanne Morris.
Do I need a Survey?
A comprehensive survey
will ensure that you are fully aware of the condition of the
property structure as this would not be revealed in any of the
searches that we carry out on your behalf.
There are several
different types of survey available. A full structural survey is
particularly useful for old or large properties. The surveyor will
report on everything that is visible. The outside of the roof will
be examined and a sample floor board will be taken up, where
practicable. The survey will cover the structure of the building,
outbuildings, nearby trees that may cause damage, water services
and drainage. The surveyor may suggest that you should have further
tests, for example, if wet or dry rot is suspected.
Your lender (building
society, bank or other institution) will arrange for a mortgage
valuation of the property you are proposing to buy, (for which you
have to pay a fee) to assist them in deciding whether or not they
are able to lend you money against the security of the property.
This valuation is solely for the benefit of your lender and we
would recommend that you arrange for a more comprehensive
survey.
We can put you in touch
with an independent surveyor or you can ask your lender's surveyor
to carry out a further survey on your behalf (there will be an
additional fee for this). Structural surveys can be expensive, so
do ask for an estimate and check whether the fee includes the cost
of the mortgage valuation.
As there are different
types of survey that you can have we recommend that you speak to
your surveyor, explaining your requirements and he or she will be
able to guide you on the best type of report. Whichever type of
survey you choose, it should be carried out by a member of the
Royal Institution of Chartered Surveyors, the Incorporated Society
of Valuers and Auctioneers, or the Architects and Surveyors
Institute. If the survey report reveals anything unsatisfactory, it
may be possible for you to negotiate with your seller to reduce the
asking price.
Please note that nothing
can be done about any defect which you discover after exchange of
contracts. Generally, you need to bear in mind that the Contract
will normally provide that you are taken to know the state and
condition of the property and it is therefore important that you
carry out all necessary inspections and surveys prior to exchange
of Contracts. The maxim is "caveat emptor", i.e. "buyer
beware".
How long will it take to buy my new house?
On average it takes
approximately 6 to 8 weeks from instructing your Solicitor to the
date of completion. Things can be slowed down if you are obtaining
a mortgage and your new lender has particular requirements or if
you are in a chain. In a chain, the slowest party is controlling
the speed of all the other parties. If you are selling a property
as well it is likely that you will want to tie your sale and
purchase together and this could also slow things down as one is
dependent on the other.
How long will it take to sell my house?
On average it takes
approximately 8 to 12 weeks from instructing your Solicitor to the
date of completion. Things can be slowed down if you are in a
chain. In a chain, the slowest party is controlling the speed of
all the other parties. If you are buying a property as well it is
likely that you will want to tie your sale and purchase together
and this could also slow things down as one is dependent on the
other.
How much will the deposit be on a purchase?
Generally you will need
to provide a 10% (of the purchase price) deposit although it can be
a lesser amount of both the seller and buyer agree. If the deposit
is less than 10%, there is usually a clause in the Contract which
confirms that if the buyer does not proceed to completion following
exchange of contracts, then the Seller has a right to pursue the
buyer for the full 10% funds.
What happens if I change my mind?
Until exchange of
contracts has taken place you can pull out of a sale or purchase at
any time. However, any costs that you have incurred will need to be
paid e.g. search fees. If a substantial amount of work has been
carried out on your behalf we may need to make a charge for that
work, but these fees will be at a reduced rate.
After exchange of
contracts both parties are legally committed to complete the sale
or purchase.
What is Completion?
Completion is the day
when the buyer become the legal owner of the property. The purchase
monies are transferred from the buyer's Solicitors to the seller's
Solicitors. When the monies are received by the seller's
Solicitors, any estate agents are instructed to release the keys to
the new owners, any existing mortgages are repaid and any title
documentation is forwarded by the seller's Solicitors to the
buyer's Solicitors.
What is Exchange of Contracts?
Exchange of Contracts
marks the stage in your transaction when a binding contract comes
into existence. Before exchange, no contract exists between the
buyer and seller, either is free to change his or her mind about
the transaction ie can withdraw from it.
When exchange of
contracts has taken place, a binding contract exists and neither
party can withdraw without incurring liability for breach of
contract. This is usually a financial penalty ie the loss of the
deposit monies. Where a deposit of less than 10% of the
sale/purchase price has been paid, the defaulting party is still
liable for the full 10%.
What is Stamp Duty Land Tax?
Due to changes in the
Stamp Duty regime on the 1 December 2003, it is now a requirement
of the Inland Revenue that the purchaser of a property is required
to complete and sign a Stamp Duty Land Transfer Form (SDLT form)
and to pay the stamp duty land tax in relation to the consideration
which you have paid to purchase the property within the defined
period ie; within 30 days from the effective date of transaction,
which is normally completion of the purchase.
The SDLT form is a 7 page
self-assessment form which requires reference to a 40 page set of
Guidance Notes and as such, we envisage that we will complete the
majority of the form, but we will require you to complete the
personal details section and also require that you sign and return
the form to us.
We will then need to
submit the completed SDLT form together with the Stamp Duty Land
Tax to the Inland Revenue within the 30 day period following
completion. The Inland Revenue will then issue a Land Transfer
Return Certificate (LTR certificate) to us, to enable us to then
proceed with our application to register you as the new owner of
the property.
You should be aware that
there are financial penalties if the SDLT form is not submitted to
the Inland Revenue within the 30 day period.
What Searches are carried out and
when?
On your purchase,
Searches are carried out at 2 stages: pre-exchange and
pre-completion.
The pre-exchange searches
undertaken are with public bodies e.g. the Local Authority,
Drainage Authority, Environment Agency etc. These searches reveal
information about the property such as any planning restrictions,
tree preservation orders, local developments which may affect the
property, whether or not the property is connected to mains water
and drainage.
Pre-completion searches
are carried out at the Land Registry and Plymouth Land Charges
Department.
Dependent on where a
property is and any specific lender requirements, additional
searches may be required e.g. Coal Mining, Flood Risk. We will
advise you of any additional searches that are required.
When do I have to insure my new property?
The property that you are
buying must be insured from Exchange of Contracts. It is therefore
essential that arrangements have been made in advance of actual
exchange so that the Policy can be put "on cover" immediately we
confirm exchange. If you are buying with the assistance of a
mortgage, your lender may require that you insure the property
through them. Your Solicitor will normally require a copy of the
insurance schedule as evidence that the property will be on
cover.
If you are selling a
property it is advisable to retain the buildings insurance cover
until the day of completion.
When do I have to pay the deposit on my purchase?
We need to have cleared
funds in time for exchange of contracts so it can be sent to the
Solicitors acting for the Sellers.
Where and when can I have the keys to my new property?
These are usually kept
with the Agent selling the property but we will confirm this to you
before completion. The keys can only be released on the day of
completion when the Sellers Solicitors confirm to the Estate Agents
(or Buyers Solicitors where there are no Estate Agents) that they
have received the full purchase monies.
Who pays the Estate Agent?
The Solicitors acting on
behalf of the Seller will usually pay the Estate Agents fees on the
day of completion out of the monies received from the Buyer's
Solicitors.
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