Purchasing a home is likely to be one of the biggest transactions you will make in your life and the process can be complicated even at the best of times, never mind in the midst of global pandemic. As such, law firms are inundated with enquiries from people looking to buy and sell property but unsure where they stand.
Our , Lisa Robertson, recently took part in The Law Society’s weekly #SolicitorChat on Twitter, answering some of the most frequently asked questions to help house hunters avoid costly mistakes.
You can read her answers below:
Purchasing a property is no longer a “one size fits all” process and there are many different options to choose from when looking for a new home. Most commonly, people will search for properties which are advertised on the open market through a particular estate agent or via an online property search engine. If you see a property you like, the acting Estate Agent will arrange a viewing either at the property or by way of a virtual viewing. If the property ticks all the right boxes, you should contact your solicitor to discuss noting your interest and putting in an offer for the property. However, this is not the only way – a wide variety of properties are now being sold by way of online auction where bids are placed online by you, or, if you are looking for a brand new home, you can easily reserve a plot with the builder who will then send all of the legal documentation to your nominated solicitor.
The next thing to consider is your financing. It is best to contact a mortgage advisor or bank at this early stage to secure the funding needed to purchase your dream home. If you are a cash purchaser, it is helpful to determine your solicitor’s requirements in relation to source of funds early on to allow sufficient time to ingather the relevant paperwork and ensure there are no delays further down the line.
After your offer has been accepted, the seller of the property will issue their acceptance in writing and lay out the conditions of the contract going forward. Your solicitor will discuss these with you together with the title deeds and ensure you are happy to proceed. If there are elements of the contract you wish to change, your solicitor will negotiate these for you until both parties are happy.
Shortly before the settlement date, your solicitor will provide details for transferring the deposit and arrangements for the collection of keys on the day.
It is important to remember that your solicitor is there to help and support you throughout the conveyancing process not just carry out the legal work on your behalf. Buying/selling a property can be a daunting experience whether doing it for the first time or whether you haven’t done it in a long time! No question is too silly and we always encourage clients to ask rather than worry.
We appreciate that some deeds and terminology may need further explanation and we are more than happy to discuss these at length to ensure you are completely happy before you put pen to paper. We can guide you through the process of offering for a property and negotiating subsequent terms to ensure that you are satisfied with the eventual outcome. In most cases, there are a number of parties involved who each deal with a different element of the process such as estate agents, banks, financial advisors, factors etc. We can liaise with these parties and provide updates on your behalf to ease a bit of the pressure and allow you to focus on other matters.
A common issue we see is where a client’s offer has been accepted for a property and then they wish to go back out to view the property in order to have a more thorough look and take measurements. Generally speaking, a second viewing isn’t permitted until the contract has been concluded which means it is so important to take a good look around the property when viewing and ask your solicitor if you have any queries regarding anything contained in the Home Report as you may not be able to revisit until you are legally tied into the purchase.
We also see issues arise in cases where settlement has to be delayed but clients have already made financial commitments for that date. Whist we understand arrangements have to be made to facilitate a house move, doing so before the conclusion of the contract creates a risk of financial loss should settlement not take place on that date. Costs cannot legally be reclaimed unless there is a concluded contract in place, therefore, It is so important to liaise with your solicitor throughout the conveyancing process to discuss the progress of the case.
My advice would be to speak to your conveyancer in the first instance if you are worried about a delay or need to delay for any reason. It could be the case that we can work out a solution to prevent this so it is always best to check before taking any action. If your sale or purchase does have to be delayed, it is important to ensure that you keep calm and plan ahead for when settlement can take place. Keep on top of any issues which require to be managed in the interim and if you are purchasing, ensure your mortgage offer has sufficient time before expiry to allow for settlement to take place.
It goes without saying that the stamp duty holiday has been a great incentive to drive property purchases in Scotland and is a fantastic opportunity for clients to secure their dream home without having to worry about this additional cost.
However, there are a few points to consider. Currently, the incentive is in place for transactions up to £250,000 with an “effective date” on or before 31 March. The effective date is the date on which settlement takes place and you collect the keys for the property. Whilst this may seem a while away, the conveyancing process can take an average of 6-8 weeks to complete without any significant delays so it is important to bare this in mind when planning your finances.
In addition to this, the holiday is in relation to LBTT and not the Additional Dwelling Supplement (“ADS”). ADS is a 4% surcharge which applies to second home purchases and is payable on all qualifying transactions during the Stamp Duty holiday period. This means if you are purchasing a residential property and already own a home, you will benefit from 0% LBTT up to £250,000 but will still be required to pay the 4% ADS charge.
If you are in the midst of purchasing a property or need advice throughout the process, be sure to contact our expert solicitors. With a flexible approach to client’s needs & budgets and a number of different funding options available, including fixed fees, it might be cheaper than you think.
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