Frequently asked questions

Exchange/completion

What is exchange?

Exchange is the process of swapping the contracts which have been signed by the seller and buyer accompanied by the payment of a deposit by the buyer. On exchange the contract becomes binding and the parties must proceed to buy or sell. The contract will contain the agreed completion date.

What is completion?

On the agreed completion date, the transfer document is sent to the buyers’ solicitors upon payment of the balance of the purchase monies. The seller must vacate the property and the buyer can then move in.

Searches

What searches should be carried out?

We will decide which searches are appropriate for the property you are buying and it is important that you tell us about any particular concerns you have.

Local authority search
A local authority search will always be carried out against the property. It informs you of any planning applications regarding the property, proposals for roads and conservation orders, amongst other things. It will not show up any planning issues affecting neighbouring properties, so you will need to let us know if you also want to check on potential development in the area.

Environmental search
Clients now often opt to carry out an environmental search that will identify any landfill or waste disposal sites, old industrial sites and flood risk.

Drainage search
This shows whether the drainage is public or private. We do not routinely carry out a drainage search, but can do if you wish to have one done.

Bankruptcy search
Your lender will ask your solicitor to carry out this search to check if you are bankrupt.

Land Registry search
This search is carried out just before completion to check whether any previously undisclosed mortgages have been registered against the property. If so, we will require confirmation that these will be repaid by the seller.

Mining search
In certain areas of the country mining searches are recommended.

Timing

How long does it take?

The speed at which we can process your move will depend on the number of properties in the chain and the wishes of the parties. Of course, we will do what we can to keep things moving and avoid other legal advisers unnecessarily dragging their feet. In reality, it is likely to take in the region of 6 - 8 weeks to get to exchange and a further couple of weeks to complete.

Does there have to be a gap between exchange and completion?

There is usually a gap between exchange and completion. It is possible to do both on the same day if necessary, although it is preferable to leave a gap. You should discuss timing issues with your legal adviser.

When should I book the removal company?

Some removal companies ask for a deposit when you reserve a date. You may therefore wish to wait until you have exchanged before paying a deposit when you can be certain of the completion date. It is best to ring around in advance of exchange to check availability and the terms of individual companies.

When should I arrange buildings insurance?

You will need to arrange cover from the date of exchange of contracts as you bear the risk from that date. Your mortgage company may propose dealing with buildings insurance, although you may arrange this yourself if you prefer. If you are buying a leasehold property, then you should check that your landlord has insured the buildings.

The insurance cover should be the estimated cost of rebuilding the property. This is probably different to the purchase price. Your surveyor will usually give you an indication of the rebuilding cost.

Costs

Will I need to pay a deposit?

A deposit is usually paid by the buyer on exchange of contracts. The amount of the deposit may be negotiable, although the seller is initially likely to request a deposit of 10% of the purchase price. If you are selling also, we can usually use the deposit you receive from your buyer unless you are buying a much more expensive property.

How much is stamp duty?

Stamp duty is a tax paid to the Government by the buyer on completion. The amount payable depends on the purchase price:

Purchase price Stamp duty
Up to 60,000 Nil
60,001 to 250,000 1% of purchase price
250,001 to 500,000 3% of purchase price
500,001 and over 4% of purchase price

If a separate price is agreed for fixtures e.g. carpets, curtains, cooker, this does not form part of the purchase price for the purposes of paying stamp duty.

Do I have to pay any fees if my sale or purchase falls through?

In these circumstances, we will make a charge to cover any work done which will not be useful if you rearrange your sale or purchase e.g. time spent reporting the results of searches on a purchase that falls through.

Mortgages

What is a mortgage?

A mortgage is a loan made to buy a property. The mortgage is noted on the title deeds and you cannot sell the property until you have paid off the loan.

What is re-mortgaging?

You may wish to pay off your current mortgage and replace it with a new one (re-mortgage) for one or more of the following reasons:
The terms of the new mortgage are better
You want to raise some cash
You want a different type of mortgage e.g. repayment rather then endowment

It is advisable to check whether there is a penalty clause in your current mortgage requiring you to pay a penalty if you pay off the mortgage early (early redemption penalty).