THE CONVEYANCING TRANSACTION

1. SURVEY

The Latin word “Caveat Emptor” applies to the sale of property it means “Buyer Beware” the onus of discovering any physical faults in the property agreed to be sold is placed on the buyer. For this reason, a full structural survey is always advisable in order to discover physical defects which are not readily apparent on inspection of the property by the buyer. The lender’s valuation is not to be relied on by the buyer it is solely to advise the lender of the market value of the property, a buyer should have their own structural survey carried out on the property.

You can obtain a homebuyer’s survey and valuation or a full structural survey. Such surveys indicate areas of concern. They advise you to instigated all necessary reports and ensure that you are satisfied with them before purchasing the property.

You should ascertain the cost of any necessary work before you enter into a binding obligation to buy a property.

2. JOINT PURCHASE:

If you are buying jointly then you must obtain the mortgage offer in joint names. Therefore, if are buying in joint names you should have filled in the mortgage application form in joint names, although if you did not, you should request to have the mortgage switched into joint names, provided the other purchaser is over 18. There are two ways of holding property and that is as joint tenants or tenants in common. Most husbands and wives hold the property as joint tenants which means that the property will automatically vest in the survivor should the other spouse die, and you would be unable to leave the property to a third party by will such as for example, your children. The other way the property can be held is as tenants in common. This means that you each hold a specified percentage of the property (e.g. fifty percent – fifty percent or seventy percent – thirty percent). If you are holding property as tenants in common it is best to have your percentages recorded in a Trust Deed. If the property is held in this manner you can leave your share of the property by will to a third party. Tenants in common is more commonly used when a property is for two friends, although it may also be designed for husband and wife especially where there is a second marriage or for tax reasons.

If you are purchasing property jointly, it is extremely important that you confirm in writing to your solicitor how you wish to hold the property.

3. PROCESS:

It is the responsibility of the seller’s solicitor to prepare the contract, to enable them to do this they have to obtain the title information for the property.

Enquiries of the Local Authority by way of Local Authority Search, enables the buyer’s solicitor to discover whether there are any matters that may adversely affect the property. The questions deal with a whole range of matters for example – planning, compulsory purchase, road traffic schemes, enforcement notices, proposed Tree Preservation Orders and building regulations.

The buyer’s solicitors will examine the papers and raise enquiries of the seller’s solicitor based on the title documents, searches and related matters about the property.

When the buyer’s solicitor is in receipt of all replies to enquiries, satisfactory searches including a satisfactory Local Search and a copy of the mortgage offer, they can then proceed.

4. DEPOSIT:

You are usually required to pay on exchange of contract a 10% deposit as a show of good faith. If you anticipate that you will experience any difficulty in this respect then, always let your solicitor know as early as possible as it might be possible to negotiate with the vendor’s solicitors for a reduced 5% deposit.

5. EXCHANGE OF CONTRACTS:

Exchange of contracts is a lawyer’s expression and means that the contract you signed is swapped in the post with the other parties’ signed contract. It is this exchange that makes the transaction legally binding. Upon exchange of contract the property you are purchasing becomes your responsibility with regard to insurance and it is important that you arrange adequate cover unless the property is insured by the Landlord. Always ensure that you read the contract/agreement for sale clause by clause to familiarise yourself with your obligations under the contract.

6. FIXTURES, FITTINGS AND CONTENTS:

Disputes have been known to arise about what the vendor is taking and leaving and it is often difficult to decide what is a fixture annexed to the house and what is not. Where fixtures, fittings and furniture are included, do check that they have been left at the house on the morning of completion.

7. REMOVAL ARRANGEMENT:

Completion is when the vendor must move. If you are selling this means literally that you move from your existing house (because you cannot get the money from the purchaser’s solicitors unless you vacate) to your new house on the same day. The solicitor has to complete your sale and get the money before they can complete the purchase.

8. COMPLETION:M

Completion is when your solicitor hands over purchase money to the seller’s solicitor and collects the Title Deeds and the premises finally becomes yours. On the completion date you will be able to collect the keys either through the Estate Agents or directly from the seller or holder of the keys.

9. WATER RATE:

You should write to the local water board and advise them that you are the new owner and give your name and the actual date you complete. They can then amend their records.

10. COUNCIL TAX:

You should inform the Local Authority Council Tax department of the date of completion so that you become liable for Council Tax from that date.

11. MORTGAGE:

If you are buying, then on completion you will hear direct from your Building Society or other lending company regarding your repayments. You would normally have a lapse of three/four weeks before your first mortgage repayment falls due and your first mortgage payment may be almost twice as much as your normal monthly instalment if in fact the timing involved is over three to four weeks.