Guide to Conveyancing

Sponsored by A Simple Guide to Conveyancing 1





THERE’S NO PLACE LIKE OUR HOME PAGE! Read back issues for free! Find out all you need to know about buying your first home firsttimebuyermag.com

A Simple Guide to Conveyancing Welcome Editor, First TLyimndeaBCulyaerrk Buying your first home is very exciting and there is nothing like the feeling of getting the keys and opening your own front door! Our aim at First Time Buyer magazine is to make the journey to homeownership a simple one, which is very easy to understand and navigate. One of the main things that often seems rather daunting and confusing is the conveyancing process. We hope this little book – A Simple Guide to Conveyancing will help you understand how it all works, answer your questions and understand what is involved in the legal side of buying your first home. We are delighted that Lawcomm Solicitors, with its expert team, has sponsored this book. We wish you every success when buying your first dream home. Happy house hunting! 5

SUBSCRIPTION OFFER! Four issues 1 issue £3.95 (Free P&P) for just 4 issues £14 (Free P&P) 6 issues £21 (Free P&P) £14 Please call our subscription team on 020 3874 1649

A Simple Guide to Conveyancing Our sponsor Welcome to our guide prepared for readers of First Time Buyer magazine to help you through the process of buying your first home. Buying a house can be a daunting process especially when it comes to the legal aspects. Buying a new build property has its own set of challenges, including different Government schemes, an array of financing options LaMwacnoamgimBniglSl DDoilhriceaicrtiotworars,l and often very tight deadlines. Lawcomm Solicitors have a dedicated, specialist team that deals exclusively with new build transactions with substantial experience helping first time buyers using the Help to Buy scheme, and existing home owners buying new build property.  Our years of experience in helping thousands of home buyers means we know exactly what needs to be done to meet the developer’s exchange deadlines and can anticipate problems that may cause delays. If necessary, we can work closely with your mortgage broker and any estate agents to ensure a seamless process, with all legal work included in our competitive fixed fee. A property purchase is a huge commitment and can be a time of stress and worry. We aim to cut through some of the legal jargon and break down the process for you into simple steps. 7

A Simple Guide to Conveyancing What type of property are you looking for? The first step on your property Research the market carefully to journey will be deciding on the see what type of property you type of property you wish to can buy on your budget and if purchase. For many buyers this you are looking at both new and may depend on the availability resale homes then get legal fee of new or resale homes in your quotations for both types preferred location or eligibility of property. criteria if you are using a shared Fees will vary not only depending ownership or shared equity on the price of your home scheme. but also on the different work involved for each property type. Get a range of estimates for all the options you are looking at so you can get a full picture of the likely legal costs to budget for. If you are buying a resale home also look to budget for having a Homebuyer Report or structural survey carried out by an RICS registered surveyor. Your mortgage lender will do a basic valuation but a detailed survey will highlight issues such as damp, wiring issues and structural faults that could prove costly or dangerous in the future. 8

A Simple Guide to Conveyancing Affordable housing schemes If you do not have the deposit Take time to or mortgage funding to buy a research the property on the open market schemes available and there are a number of affordable all the options before housing schemes available that deciding on what scheme are specifically designed to get and what property you on to the property ladder. is right for you In the next section we discuss in more detail the two most sale under one of these types of common schemes, but a range of schemes on an affordable basis. options are available. A further percentage must usually Planning Policy now dictates, also be offered for affordable rent. particularly with new build sites, There is a wealth of information that a certain percentage of the available online about what homes built must be offered for types of scheme operate in your area and your local authority or local housing associations will also be able to help. Specialist publications such as First Time Buyer magazine can give you an idea of what is available and what schemes are up and coming and specialist financial advisers can look at your financial circumstances and advise on what scheme would best suit you. 9

A Simple Guide to Conveyancing Help to Buy scheme/ shared equity Help to Buy A FEW HELPFUL FACTS is the equity TO CONSIDER loan help for home buyers • You must provide a 5% cash from Homes deposit. England which makes new • You must take out a first build homes available not only to charge mortgage with a first time buyers but to all new qualifying lender. build home buyers who might otherwise be unable to raise • The maximum purchase the necessary deposit but could price is £600,000. afford a mortgage. Up to a maximum of 20% in • The property purchased England and up to 40% in must be your only London, of the purchase price residence. can be lent to buyers through this Government equity loan scheme. • Help to Buy is not available The scheme is still in place and to assist buy-to-let investors. currently set to run until 2021. • You cannot rent out your existing home and buy a second home through Help to Buy. The Help to Buy loan will be paid directly to the developer on completion and Homes England will take a secured charge – a second mortgage – against your new home. 10

A Simple Guide to Conveyancing Shared ownership These schemes are offered by registered housing associations and local authorities. You will buy a “share” of the Buy Rent property and pay rent on the remaining share. You can buy further shares in “standard” obligations on you as the property at the market value owner. For example, you will still of those shares at the time of have to: purchase. Buying further shares is • contribute towards the costs referred to as “staircasing”. As you buy further shares, incurred by the landlord in the rent will be reduced providing services proportionately to reflect the fact • need to seek the landlord’s that the landlord’s interest in the consent before making certain property has reduced. alterations In most cases you will have the • comply with regulations normal responsibilities of a full relating to the management owner. This means, for example, of the estate of which the that you as the leaseholder will property forms part. be obliged to pay 100% of the Should you wish to sell or outgoings relating to the property remortgage the property you will and keep the property in good and need the consent of your housing substantial repair and condition. association to do so. The lease also contains other 11

A Simple Guide to Conveyancing The difference between shared ownership and shared equity schemes With shared equity you purchase ownership property (normally all of a property and legally own owned by a housing association), all of the property. However, your and you can only achieve 100% deposit is reduced because you ownership by “staircasing” up to buy with a large equity loan that full ownership. reduces the amount you have to You will pay rent on the part of borrow but is attached to your your home you don’t own yet and property and will need to be will also be liable for maintenance repaid at a later date. and insurance charges. With With shared equity there is some leasehold apartments sold generally a requirement to under the shared ownership repay the equity loan within 25 scheme you may also have to pay years, or earlier if you sell your ground rent on top of the rent on home. Shared equity is generally the share you don’t own. provided by house builders and shared ownership by housing associations, but there are some housing associations with allocations for the Help to Buy: Equity Loan scheme. In contrast, shared ownership schemes are usually undertaken whereby you only own a specific share as a lease on a shared 12

A Simple Guide to Conveyancing What is staircasing? In a shared ownership lease, You should let the housing you will find reference to the association know if you have provisions for “staircasing”. This carried out any improvements to is the procedure that allows you your home as these will normally to purchase further shares in be discounted from any valuation your home. to prevent you from paying for The price you pay for any further any improvements twice. percentage share will be worked You will need to contact your out based on a valuation carried mortgage lender to confirm out by the housing association, whether it will lend you the for which you will normally be additional money required expected to pay an upfront to buy a further share fee. This is not refundable if you in your property. The decide you do not wish to or additional amount it will lend you will often cannot afford to staircase. determine the amount of further share you can purchase. You should also note that the housing association is entitled to refuse your request to staircase if your rent is in arrears or if it is currently taking action against you for a breach of your lease conditions. 13

A Simple Guide to Conveyancing Prepare for the homebuying process Once you have decided on the type of property you would like to purchase, it’s time to get your paperwork in order. Sit down and work out both your purchase budget and current living expenses to make sure your goals are achievable. Gather your statements and wage slips together as you will have to prove your income and routine expenditure as part of the purchase process. Get quotes for your solicitor’s fees and any insurance you will need and make sure you include these costs in your budgeting. This is a great time to review whether you need to take out life or other income protection insurance and to make sure you have a Will that sets out what will happen to your home if the worst should happen. 14

A Simple Guide to Conveyancing What identity documents will you need As part of the process, your solicitor, broker and developer or housing association will ask you to prove who you are. This applies to all buyers and anyone who is putting money towards your purchase too. Take copies of your ID as you although most law firms can now may have to send these to your run an electronic check based mortgage broker, solicitor and on copies. Try to ensure that housing association. You may you have both to hand and that need to produce the hard copies, you check each separate party’s requirements carefully. You will need current photographic ID such as an in-date passport or photocard driving licence and that you have original paper copies of bank statements or utility bills that are less than three months old. 15

A Simple Guide to Conveyancing What is \"source of funds\" As part of UK Money Laundering under three months old Regulations you will have to • Evidence of the source of any provide evidence of how you came to have the funds you are lump sum deposits into your putting towards your purchase. account such as money from a gift or inheritance Your solicitor will advise on what If your finances are more proofs you will need as this will complicated or if you have differ in every case, but as a obtained money from abroad general rule you will need as a then further proofs are likely starting point: to be required. Your mortgage • Your last three months’ payslips broker and solicitor will be able • Hard copy bank statements to guide you on what proofs are required in your specific for your current and or savings circumstances. accounts which should be 16

A Simple Guide to Conveyancing What if I am getting a gift? If you are getting a gift from a driving licence and that you family member or friend to assist have original paper copies of with your purchase then make bank statements or utility bills sure you have documentary that are less than three months evidence to show where these old showing the gift money funds are coming from. accumulating in their account and The person giving you the gift being transferred to you. will have to sign a declaration to confirm that they do not expect that money back and they will not have a legal interest in your home. Your mortgage lender will require this to confirm that if it had to repossess your property then this money will not have to be repaid. Let your broker and solicitor Make sure they are know about the gifted money willing to co-operate as soon as you can in the with the process and legal process and they will be to provide all proofs able to guide you on what forms you will need the person giving requested. you the gift to complete. Also make sure anyone gifting you money has current photographic ID such as an in-date passport or photocard 17

A Simple Guide to Conveyancing Instructing a solicitor Once you’ve reserved a property and send a report to you, to buy, the process begins with including the contract for you the following steps: to sign and return. • The developer or housing • At this stage you have the opportunity to review the association sends us a paperwork and raise any Reservation Form for the questions you have. Remember, property. we will not have visited the • We send you our instruction site or been involved in your pack – this contains a initial conversations during confirmation of our fee the reservation process so estimate and forms to collect it is important you check all the information we need everything to confirm that it from you to get started. matches what you agreed. • You complete and sign the pack and pay a deposit to cover the cost of searches and initial disbursements. • We will notify the sales office/ agent that you have instructed us and request the legal paperwork for your property from the seller’s solicitor. • We electronically check your identity. • Once we receive the legal paperwork we will carry out property searches. • We examine the paperwork from the developer’s solicitor 18

A Simple Guide to Conveyancing Choosing your mortgage product Take advice from a reputable You should consider a broad mortgage broker or financial range of options and have an adviser and look at the range of overview of all surrounding costs, product options. Don’t hesitate such as mortgage arrangement even at this stage to take their fees, legal and insurance costs advice on all of the different and rent and service charge costs options open to you. (if you are buying an apartment) If you are buying a property so you can fully review the under a shared ownership or available options and decide what Help to Buy scheme then you are is really affordable. advised to seek out a broker who Your solicitor will advise you on specialises in this type of scheme the legal terms of your mortgage as they will have knowledge of but we do not offer any advice the full range of products that are on the suitability of a particular available. mortgage product for you. Your broker or financial adviser will be able to guide you on the product that’s the right fit for you. 19

A Simple Guide to Conveyancing Extra costs to consider In the case of nearly every new leasehold homes there are usually build property, a fee is charged notice fees to pay to confirm by the developer’s solicitors for your details to the landlord and/ preparing the transfer deed (for or management company and a house) or lease (for a flat). administrative fees payable for Where properties are sold as part items required to be sent to of a development it is essential or obtained from them such for the obligations contained in as Deeds of Covenant or Land these documents to be identical. Registry certificates. To ensure this happens, the Any additional fees being developer’s solicitors will prepare charged by the landlord and/or them. Normally it is the buyer management company should that must pay the associated be advised to you as soon as legal fee. The amount charged your solicitors have checked the is approximately £180-£240 title paperwork to your property (including VAT) but varies from as these vary from property to one developer to another. property and between different With both resale and new build landlords and property managers. 20

A Simple Guide to Conveyancing The legal process checklist Instruct Your solicitors will send you an initial pack Solicitors which you will need to fill out and return with your identification and usually an Memorandum initial payment on account for searches of Sale The estate agent or housing association will send a Memorandum of Sale with details of the property, any terms or deadlines that have been agreed and their solicitors’ contact details. Contract Pack The seller’s solicitors will send your solicitors a Contract Pack which will include all the documents necessary to raise enquiries. Searches Included in the pack will be a plan of the property so your solicitors can order your searches. Enquiries These are legal questions your solicitors will raise about the property. You can also then let them know if you have any specific questions to raise. Mortgage Your lender will send you a copy of Offer your offer and a separate copy to your solicitors which will set out your mortgage terms and any matters they want your solicitors to confirm 21

A Simple Guide to Conveyancing The legal process checklist Searches Once all your searches are in, your Received solicitors will check these and report to Title Report you on the results When all the above has been done, Final File your solicitors then send you an overall Review report on your property. This will include anything we feel you will need to know Exchange about the property before proceeding Completion to exchange. If you are happy with the report, all your questions have been answered, all signed documents are in and your deposit has been received, your solicitors will do a final file review to make sure we are ready to exchange. When all the above steps are satisfied you can formally exchange. This is the final stage and the day that you will receive the keys and move into your new home. 22

A Simple Guide to Conveyancing Searches The searches may reveal details person cannot be “found” by about the area surrounding the the relevant authority after a site such as mobile phone masts, “reasonable enquiry”, the owner flood risk or rail developments, or occupier of the land is liable. such as HS2, that may require Your Environmental Search specialist investigation or further would identify any potential searches to make sure you are land contamination together aware of any matters that may with other risks such as unstable impact the value of your home. ground conditions or flood risk. The sellers are under no obligation to disclose the information that would usually be contained in your searches. It is up to your solicitors to carry out all relevant searches that are suitable for the type of property and the location in which you are buying and to properly investigate the results for you. Your environmental search is also very important. Under the Environmental Protection Act the person who caused, or knowingly permitted, the existence of the contamination is primarily liable but if that 23

A Simple Guide to Conveyancing Enquiries Land Registry title to that the sellers have not done a development site anything to the property that is is often a complex not allowed under restrictions affair. The land under in the legal title or that required development may well consent or certificates which they be a mix of different do not have. parcels of land, each of We need to make sure all of which have different the title information is checked, rights and obligations all certificates and documents attached. Many of these have been provided and that will be historic or in any insurances offered are fully case of land that has enforceable. changed hands many times simply unknown. Where matters affecting the title have not been fully revealed to the Land Registry or where there are older restrictions that may restrict development of the site, the developer may have put in place indemnity insurance Similarly, with a existing home the title needs to be thoroughly checked. The title will often also be subject to a number of prior transfers and deeds that all need reading through carefully. In addition we need to check 24

A Simple Guide to Conveyancing Plans We will carry out our checks with the Land Registry to make sure, You would think it would be a as far as we can, that all of the set conclusion that all the land land on the site belongs to the included in the development developer and the boundaries are belongs to the seller and that correct. Please note, however, everything on the plans matches that we do not inspect the site. the layout of the site on the When your conveyancer sends ground, but this is not always you your plans you need to check the case. these very carefully as you are Land Registry boundaries are our eyes on the ground to tell us usually based on the latest if something doesn’t look right. versions of the Ordnance Survey and the older title deeds, not a physical inspection. Development and plot plans are usually drawn up at the beginning of the development of a site before building has even commenced. This means there can be variances between what the plans intend and the actual layout of the boundaries and roads and pathways on the site itself. 25

A Simple Guide to Conveyancing Service and estate charge arrangements There will be areas on the satisfactory answer to who will be site that are not being sold to responsible, how will maintenance individual buyers. This could be costs be dealt with and who will the communal areas in a block of organise collecting the money for flats or the roads and open areas the work that needs doing. These on an estate of houses. There will arrangements all need to be in also often be shared facilities and order to make sure you know utility supply wires and pipes that who to contact if repairs need someone needs to take care of in doing and how much you may be the future once the site is finished paying in the future towards the and the developer has moved on. cost of the estate as a whole. We need to make sure we have a 26

A Simple Guide to Conveyancing Management companies If your property is subject to of Transfer and Charge on service or maintenance the managing agents not the charges then the charge freeholders. This would usually will be estimated at attract an administration charge. the beginning of each For us to be able to register you financial year and you as the new owner of the property, will be asked to make a Certificate must often be issued your contributions by the Landlord or their Agent in advance based on confirming that the terms of the that estimate. At the Lease have been complied with. end of that accounting An administrative fee is usually period a final account will charged for issuing the required be prepared. We should Certificate of Compliance. note that if there is any shortfall between the estimated maintenance charges and the actual expenditure, then the management company reserves the right to collect any shortfall from the property owners. This is often referred to as a “balancing charge”. You will often be required to pay some or all the year’s service charge in advance depending on whether this is collected on a monthly or annual basis. Please also note that at completion we will serve Notices 27

A Simple Guide to Conveyancing Common lease restrictions Present property law in England • Obligations not to obstruct or and Wales effectively requires damage shared corridors and that flats be leasehold, although internal spaces some leasehold flats are now sold with a share of the freehold, • Restrictions on noise at certain through participation in a times of day residents’ management company. All leases contain restrictions or You need to ensure you a list of do’s and don’ts which are thoroughly read all the lease designed to protect the overall terms and, especially if you are value of the property and to buying a property with an older ensure in the case of a communal lease that may be in less modern building that all the residents can language, that your solicitors fully use the facilities available and live explain all these to you in terms together in relative harmony. that you can fully understand. Your solicitors should set out all of these for you in detail as all leases are unique, but some common restrictions you may encounter include: • Restrictions on you making structural changes to the building • Restrictions on keeping pets • Obligations to keep your property in good repair 28

A Simple Guide to Conveyancing Heat supply agreements If you are buying an apartment in a shared building then you may be asked to enter into a heat supply agreement. There is a Heat The Heat Supply Company named Interface Unit (HIU) in the Agreement is responsible within each home – for maintenance of the district this looks a bit like heat network, up to and including a boiler and will the Heat Interface Unit (HIU) in usually be located in each home. the utility cupboard. You will be responsible for the Your experience of the maintenance of the internal heating and hot water you receive heating circuit – this includes the should be no different than if you radiators or underfloor heating had a combi boiler in your home. (as applicable), heating controls New build developments have (thermostats, programmers, to comply with policies and timers), the hot water taps and standards set by the Government. showers, and all the pipework The Government’s current energy that runs between the HIU and policy requires the introduction the radiators/taps/showers. of heat networks in cities wherever feasible. This is in order to generate heat and power more efficiently, improve cities’ energy security and self-sufficiency, and reduce carbon dioxide emissions. 29

A Simple Guide to Conveyancing Stamp Duty Land Tax Stamp Duty Land Tax (or Land and Buildings Transaction Tax in Scotland and Land Transaction tax in Wales) is a lump sum tax that anyone buying a property or land costing more than a set amount has to pay. The rate you’ll pay the out for a basic purpose using tax at varies based on the price the Government calculator and of the property and the type. The your legal adviser will be able to Inland Revenue has produced confirm if there are any reliefs or a calculator to work out your options to defer available to you. potential liability here. If you are buying a rental property www.tax.service.gov.uk/calculate- or second home you will find stamp-duty-land-tax/#/intro yourself liable to pay Stamp If you are buying a shared Duty at a higher rate than if ownership property or are a you own only one property and first time buyer then you may again you can estimate this using be eligible for relief from or the Government calculator or deferment of some of the tax you ask your solicitors to provide have to pay. you with a figure as part of the The Stamp Duty can be worked quotation process. 30

A Simple Guide to Conveyancing First Time Buyer Relief If you qualify as a first time buyer A first time buyer is someone then you may be eligible for tax who has never owned a freehold relief on your purchase. or leasehold interest in a dwelling • First time buyers paying before and who is purchasing their only or main residence. £300,000 or less for a Residential property anywhere residential property will pay in the world is counted when no SDLT. determining whether someone is • First time buyers paying a first time buyer. Where you are between £300,000 and purchasing jointly with another £500,000 will pay SDLT at 5% person/s all parties would need to on the amount of the purchase be first time buyers to qualify for price more than £300,000. the relief. • First time buyers purchasing property for more than £500,000 will not be entitled to any relief and will pay SDLT at the normal rates. 31

A Simple Guide to Conveyancing Shared ownership Stamp Duty When you Premium) but also on the amount purchase a of rent you are paying. As the new shared level of rent you are paying for ownership lease, a shared ownership property is the tax rules usually a lot higher, this can have a work differently significant impact on the amount to the rules that of tax you would pay. would apply if If the amount you are paying is you were buying under the threshold for SDLT, a freehold you can choose to defer property or one paying tax until you buy further with an existing percentages of the property up to lease. You have a 80% share. a choice about when and how you pay your tax and you need to consider this carefully depending on your individual circumstances. Under the Stamp Duty Land Tax (SDLT) rules, you can choose to pay tax when you purchase the property at the rate it would be due if you were buying 100% of the property at full market value. Or you can choose to pay on the price you are paying (The 32

A Simple Guide to Conveyancing Indemnity Insurance Policies Sometimes there will be potential For existing homes these policies issues with the title to the land can again cover a range of areas which require specific insurance in respect of the property’s title policies. In the case of a large or be used to cover matters for site these are often dealt with by which consents or permissions blanket policies that are put in were required (such as extension place for the site as a whole and works for example) that have not provide financial compensation in been obtained. the event that the matter that has Your solicitors should explain to been insured against occurs. you any insurance policies that are in place for the property Common reasons for such which you are buying and policies include: whether the benefit of these • Missing or incomplete title policies will pass to you. documents that may give a third party rights over the land. • Historic restrictions that would prevent the development of the land for housing. • Mining rights being reserved under the land to extract particular minerals. Each development site is unique and has its own history or previous use and ownership and there are a wide range of different policies available. 33

A Simple Guide to Conveyancing Building control & warranty Your new home will come with to make sure it is the right type of a new home warranty. National warranty for your home and that House-Building Council (NHBC all the conditions have been met for short) are the most common, to enable you to make a claim in but there are a number of the unfortunate event that issues different schemes. We need to arise in the future. check the individual warranty If you are buying under a provider’s terms and conditions shared ownership scheme, you are buying a part share in the property and so the guarantee will initially be entered into between the housing association and the warranty provider. They will retain all documentation for this, although you will have the benefit of it. If you have any issues with the property that you believe may be covered under the warranty, then you should contact the housing association as a point of first contact and it will investigate the issues and, if needs be, make a claim under the warranty for you. 34

A Simple Guide to Conveyancing Handover This is a term that can cause Be careful confusion. Especially with shared not to confuse your ownership properties that are property’s handover date not being built by the housing with the completion date if you associations themselves. are making arrangements, for This is usually used to indicate example to hand in notice on when the property is finished your rented accommodation and ready to occupy but if so you don’t get caught you are buying from a housing association then the property will out if handover is first need to be inspected delayed. and checked over by the association before it accepts the property from the developer. In these cases you may find that the day that the property is to be handed over to the housing association is not the date you will complete your purchase. This is because there are matters to be finished off by the developer or issues the housing association wants the developer to resolve before they take legal responsibility for the property. 35

A Simple Guide to Conveyancing Snagging When you buy a new home you If there are matters of concern would hope to be more than then the developer or housing happy with the finished product. association will usually agree to There may be, however, certain finish these off or put things right. items that are not quite right or Make sure you make a full list of that need finishing off that you any issues you want dealt with would like the developer to come and discuss this with them as back and put right for you. These soon as possible. things are known as “snagging items”. Sometimes these are things that you may already know will not be finished (such as planting or landscaping works) and these sorts of outstanding items are covered under the term snagging too. You should ensure that when you accept the keys to your new home the developer or housing association do an inspection with you. A checklist is a useful tool to take with you if they do not provide one. You need to check that any included appliances are working as well during this inspection. 36

A Simple Guide to Conveyancing Exchange of Contracts Once contracts Completion “on notice”: have been agreed this is when you must wait until and signed by the property is ready. Once ready, both parties, we will be given a notice period by they are securely the developer in which we send exchanged on a you our completion statement specific date (this and request funds. is usually within 28 days of your initial reservation). At this point you and the developer are committed to the transaction.  At this stage you will also agree the timescale for completion. This can either be a fixed date or “on notice”. Fixed Completion date: If you are in rented this will happen if the property accommodation and contracts is ready to move in to. If this are exchanged “on notice” do not is the case, we will send you a hand in the notice on your rented completion statement (details home until the formal notice of all costs involved including period has been served and a outstanding fees). If you have a completion date has been fixed mortgage, we will request the with the developer or with the funds from your lender. housing association. 37

A Simple Guide to Conveyancing Completion Checklist Ensure you have the total balance of funds available to cover the balance of your purchase price, and legal fees ready in your account. If you are buying a freehold property, it is important that your buildings insurance is placed on risk immediately following exchange. If you are buying a shared ownership home this will not be necessary. If you decide to use a removal company, it is essential that you secure your removal date and confirm the arrival time and final arrangements with your removal company including directions or postcode of your new property and any access issues. Change your address details. You may consider having your post redirected for an initial period. Make a list of contact details for the day so you have these easily to hand, ie solicitors, estate agent, developer or housing association. Ensure your mobile is fully charged in readiness for the day of completion so you are contactable. On the morning of completion, make a note of all meter readings at your new property once you arrive. Notify the relevant utility companies of your arrival and the date – at that date you become liable to cover the bill. 38

A Simple Guide to Conveyancing Completion day Once your new home is ready, If you are buying a resale home an official handover of the you will usually collect keys property to you is arranged. directly from the seller or the Keys, building log books and sale agent. You should carry out owner’s manuals are issued at an inspection of the property this point and a defect reporting and appliances to check that procedure agreed upon. Make everything is as described and sure that you are given copies inform your solicitor promptly if of all the guarantees relating to there are any issues. the property, including all white Again, as with a new build goods (such as cookers, fridges property, check you have been and boilers), windows and flat given all the keys and warranty roofs (if they have installer’s and guarantee information and guarantees) and damp proofing manuals you were expecting. and timber. Make sure you read all the meters for the property and make a note of the current readings in case the seller has forgotten to do so. 39

A Simple Guide to Conveyancing Your rights if you were to discover problems with your new build home The Consumer Code for Home THE CODE: WHAT TO Builders is an industry-led code EXPECT: of conduct for builders. The aim • to be treated fairly of the Code is to ensure that • to know what levels of all new build home buyers are treated fairly. service you can expect The Consumer Code applies to • to be given reliable home buyers who, on or after 1 April 2010, bought a new or newly information about your converted home built by a home purchase and your rights builder registered and insured • to know how to access by one of the following home resolution arrangements warranty bodies: to deal with any complaints • National House Building you may have Council the initial purchaser of the home • Premier Guarantee but also to any subsequent buyers • LABC Warranty of that home within the first two The Code’s pre-sale and years of the initial purchase. handover requirements apply to If you fall into dispute with your homebuyers who are the first developer or housing association purchasers of that home. and your property has one of The Code’s after-sales service these warranties then you may applies not only to anyone who was be eligible for assistance under the Code. 40

A Simple Guide to Conveyancing Glossary of terms Caveat Emptor: means “let the 10% of the purchase price but can be buyer beware”. It describes the fact a lesser amount if pre-agreed. It is also that there is no positive obligation the amount that would be forfeited of disclosure by a seller to the buyer by the buyer to the seller should the during the sale and purchase process buyer fail to complete. about the property and it is for the Disbursements:  are costs incurred buyer to ask the questions. by us during the sale or purchase Chain: is the word to describe the process such as Land Registry fees buyers and sellers who are dependent which we pay to third parties as part upon one another in order for their of our legal work sale and purchase to go through. Contract Pack: this is the pack Charge: is a debt secured against produced at the outset by the seller’s your property. In most cases this will solicitors which includes a contract, be a mortgage. a copy of the title to the property Chattels: is another name for the and the property information forms property furniture and contents. or site documents such as planning Completion date: is the date when documentation.     payment is made and the legal transfer Drainage search: is a check your of the property takes place. This is solicitor will carry out to ensure your also the day you would usually collect property is connected to mains water your keys and you can move in. and sewers. Conveyancing: is the legal process of Environmental Search: it seeks to buying your home. identify whether the land could be Covenants: are obligations and contaminated land and therefore restrictions that are attached to the liable for costs to clean up based on property that may limit your use and previous land use. enjoyment of the property. Exchange of contracts: is when your Deeds or Title Deeds: most land solicitors make the transaction legally in England and Wales is registered binding and fix the completion date. at HM Land Registry and therefore Fixtures and Fittings: refers to items legal ownership is evidenced by the that belong to the seller and are at electronic register. the property. Fixtures typically are Deposit: is the money paid by the not easily removable items whereas seller’s solicitor to the buyer’s solicitor fittings are moveable. at exchange of contracts. It is typically Freehold: means all the property 41

ALaSwimcopmlemGuGiudiedetotoCoCnovnevyeaynacnicnigng within that area from the centre of the searches will reveal any council plans earth to the skies. Ownership is not that may affect the property you wish limited in time unlike the other form to purchase. of property “leasehold”. Property Information Form: is a Ground rent: is a yearly fee relating form a seller will complete. It lists to leasehold properties. This is payable questions regarding boundaries, by the leaseholder to the freeholder. services, guarantees and restrictions. If Indemnity insurance policy:  you are buying a newly built property protects the buyer against any this will usually be replaced with a problems that may be experienced property specification which will be due to a defect in the legal title. It is provided on site available where the risk is low. Your Reservation fee: is typically found in solicitors can advise you whether this the new homes market and is a sum can/should be used in a particular paid before exchange of contracts to circumstance. reserve the property for a period of HM Land Registry: is a Government time to give you exclusivity to buy. You organisation that deals with ownership should expect this to come off the of property and land in England and purchase price.  Wales and holds an electronic register Service charges: are payable to your of all land ownership. landlord in respect of a leasehold Lease: The legal document for a property. The charge covers any leasehold property that sets out repairs, maintenance or improvements how long you will own the property made to the building or shared and what conditions and rents your facilities or common spaces. ownership will be subject to. These Stamp Duty Land Tax: also known are complex documents and you will as SDLT, is a tax payable to HMRC and require specialist advice on this. is based on the purchase price of the Leasehold: is the other form of property. Your solicitor will be able to property tenure and relates to the advise the rates applicable to you. right to occupy an area of freehold Transfer deed: is legal document land for a specified term which is then that transfers the ownership of reducing and paying a nominal annual the property from the seller to the rent. For this reason the length of the buyer. If you buy with a partner this lease is important for your solicitor to document also defines your shares in ascertain as it can have a significant the property. effect upon the value of your property Transferor: means the seller. as it gets shorter. Transferee: means the buyer. Local authority searches: these 42



A Simple Guide to Conveyancing firsttimebuyermag.com 44