Property Buying
Guide
This Guide is intended to explain the typical
steps involved in buying a property. The Guide is free to
everyone. After reading it, you should have enough knowledge
of how to successfully go through the buying process and to
handle your purchase with confidence.
The estate agent is paid by the Vendor, so they act for them
not the purchaser. He is not obliged to highlight negative aspects
of the property to you. The agent will show you suitable property
and put any offers to their vendor clients.
There are a number of costs to be taken into account
when buying property. Typically these are:
• Solicitor's fees
(Including government charges, transfer fees, local authority
searches, etc)
• Part payments on municipality charges, service charges
• About 10% deposit
• Property insurance and house contents insurance
• Mortgage (indemnity premium and arrangement fees -
usually can be added to mortgage)
• Surveyor's fees
• Removal firm
• Municipality Charges
• Estate Agent fees
• Services (Any utilities that need to be reconnected,
mail redirection)
Roughly these are the steps involved in buying property:
• You find a property
• You get a mortgage and appoint a solicitor
• The mortgage company will carry out their valuation
on the property
• You instruct a surveyor to do a home buyers report
or a full survey
• The Vendors Solicitor supplies draft contract, title
deeds on the property to your Solicitor or any other proof
of ownership
• Your solicitor arranges for local search and raises
any queries with the Vendor's solicitor.
• Once your solicitor is satisfied you can proceed to
signing contracts and agreeing a completion date.
• You provide the Vendor with the deposit
• Signed contracts are sent to you from Vendor
• Contracts are exchanged and you arrange insurance
for the property
• Completion takes place on agreed date
• Your solicitor pays remainder of purchase price to
Vendor's solicitor
• Vendors solicitor confirms that sale is complete and
arranges for keys to be handed over.
• You move in!
Top tips for home buyers:
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Keep registering with estate agents. |
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Sometimes agents don't get back to you or send details.
It can seem like they're not interested and you wonder
if they want to sell houses! This is a misleading perception
- they're just busy and someone else might have beaten
you to the post. Estate agents are not obliged to call
you when your ideal property comes in. So it pays to call
and visit regularly. |
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Appoint a solicitor before you find a property. |
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This will avoid delay once you've found a property and
want to proceed to survey. It also shows the purchaser/estate
agent you're serious about buying. |
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Find out the history of property you're interested
in. |
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For example, how long it has been on the market, if
any offers have fallen through etc. This'll highlight
any possible problems - for example did the purchaser
find a problem at survey stage. |
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Offers should always be subject to survey. |
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Make an initial offer of around 10% less than the purchase
price and be prepared to go upwards. You may meet somewhere
in the middle. However, in a market where demand is high,
properties usually achieve their asking price and you
run the risk of loosing it. |
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Establish solicitor's costs up front. |
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Legal costs can mount up so establish what it could
cost best and worst case. That way you can budget. |
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If you wish to appoint a Surveyor to prepare a report on the
condition of the property then this should be done when your
offer has been agreed. Normally, three types of Report are available,
depending on the extent of information you require. You should
ask your solicitor which type of survey is appropriate for the
property you're buying.
Mortgage Valuation Report - This one is
carried out by the mortgage company to determine that they
are prepared to lend you money to buy the property. Often
their valuation can be up to 15% lower than the asking price
- this is because they are always more cautious. It does not
mean that the property will not sell for the asking price.
It's not advisable to rely on a mortgage valuation - the mortgage
company has no legal obligation to you. So you should arrange
either a Home Buyers or Full Structural Survey.
Full Structural or Building Survey Report
- This survey can be a very detailed report depending on what
is agreed with the surveyor. It goes a few steps further than
the Home Buyers report and is often recommended for property
that is particularly old.
It is important to appoint a Solicitor who will deal with the
sale of your property promptly. The cheapest might not be the
one who looks after your interest best. It is essential the
Solicitor is geared to handling residential sales, can be readily
contacted and can deal with your work speedily. In our experience,
it is in your interest to appoint a Solicitor who is fairly
local.
You may want to get your solicitor involved as soon as you make
an offer (which should be made subject to survey). Your solicitor
can then advise what steps to take if there are any problems
with the survey.
When the buying processes start and the Vendor's Solicitor
has obtained the property title deeds or proof of ownership,
they will prepare the contract of sale. Your Solicitor will
then examine the papers and raise any queries based on the
title deeds, and related matters about the property.
When your Solicitor is in receipt of all replies to enquiries,
a satisfactory local search, a copy of a mortgage offer, a
signed contract and a deposit cheque, they can then proceed
to exchange of contracts.
The deposit cheque is normally for a sum of 10% of the purchase
value of the property. You therefore need this sum in order
for you to progress to exchange. Exchange means the transaction
is legally binding.
Completion is normally 28 days from the date of exchange.
On completion your Solicitor hands over the remainder of the
purchase money to the Vendor's Solicitor.
At completion, not before that exact time, you can move into
your new home. Keys will be handed over by the Vendor or estate
agent.
Exchange of contracts :
Arrange insurance - You will need to arrange
insurance for your property usually when contracts have been
exchanged. Your solicitor will be able to advice.
Services & Maintenance Contracts - It
is important, in order to avoid unnecessary costs/avoid disconnection,
that you notify the service authorities (gas, water, telephone,
electricity) of the date that you will be moving from your
property. Also you'll need to notify the service authorities
in the area you are moving to of your move in date.
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