RESIDENTIAL CONVEYANCING GUIDE
LEGAL FEES...
At the beginning of your transaction we will provide you with an estimate of our fees. We are not VAT registered which means that we will not charge VAT on these fees. Your legal fees are likely to be in the region of £575.00 for a freehold or leasehold sale or purchase up to a price of £500,000.00.
Please call or e-mail us to discuss costs for all types of property transaction. If we have been instructed through an estate agents panel, fees may vary. Repeat clients will be entitled to a 10% discount.
If any of the following circumstances arise a small additional fee may be payable:
OTHER COSTS...
Costs payable to third parties are called "disbursements". If you are selling these are likely to be:
If you are buying, these are likely to be:
Land Registry Fees
These depend on the value of the property and whether the land is already registered but range from £40.00 (for transactions under £50,000.00) to £700.00 (for transactions over £1m). If you are buying at a price between £200,000.00 and £500,000.00, the fee payable is £280.00.
Stamp Duty Land Tax
This is payable upon completion, to the Inland Revenue. The charge is calculated as a percentage of the full purchase price (which INCLUDES any price payable for additional fittings and contents). The rates payable are:
up to £175,000.00: 0%
£175,001.00 - £250,000.00: 1%
£250,001.00 - £500,000.00: 3%
£500,000.00 and over: 4%
Some properties (albeit not many!) are exempt from Stamp Duty Land Tax altogether. If you provide me with a postcode, we would be happy to check this.
Bank Transfer Fees
On completion we will need to send the balance of the purchase monies to your seller's solicitor by CHAPS payment. This is usually £35.00 (including administration fee).
Leasehold Properties
If you are buying a leasehold property, there are likely to be additional charges. These are usually:
Searches
We will need to carry out some searches for you and will do this as soon as we receive the draft contract and papers from your seller's lawyer. Some searches will be essential if you are using a mortgage to fund your purchase. There are also some recommended searches. Please see below for further information.
LEGAL TERMS EXPLAINED...
Below are my Plain English definitions of some commonly misconstrued terms in conveyancing transactions:
EXCHANGE - this is the time at which the agreement between you and your seller or buyer becomes legally binding. It is the time at which your moving date will be set in stone. Before exchange of contracts, you will suffer no loss (apart from survey and legal costs) from withdrawing from the transaction. If you withdraw after exchange, heavy penalties are usually payable.
COMPLETION - this is the date on which the property is legally transferred. If you are buying, it is the date you become the legal owner (it is often believed that you become the legal owner upon exchange but this is not the case). Depending on your circumstances, this is usually the date that you will move home.
DEPOSIT - if you are buying a property, you will be required to pay some of the purchase price to your seller when you exchange contracts. The amount payable is usually 10% of the purchase price. Often a lower deposit can be agreed but the minimum payable is usually 5%. This acts as an incentive to proceed to completion. If you fail to do so, you will lose the full 10%, whether paid in full at exchange or not. The deposit must come from your own funds. If you are using a mortgage to fund your purchase, you will not be able to use these funds as a deposit as the money does not become available until completion.
COMPLETION MONEY - This is the difference between the total purchase price and costs, less the deposit paid and mortgage advance. We will prepare a statement for you as soon as we can so you know what this figure will be. We will need the completion money on the day before completion - if you are completing on a Monday, we will need cleared funds on the Friday before.
PAYMENT ON ACCOUNT - At the beginning of your transaction, we will ask you for a payment on account of costs. If you are selling, this will be the cost of the HIP plus £20.00 for Land Registry information. If you are buying, we will need the sum of £150.00 to pay for searches. The amount you give to us will be deducted from the total costs incurred on completion.
SEARCHES - When you sell your property, the essential searches will be applied for as part of your HIP. If you are buying with a mortgage, a Local Authority search will be compulsory. Some HIPS contain inadequate local authority searches and, if this is the case, you may need to pay for a new search or an insurance policy. We also recommend other searches for all properties. These are:
It is likely that all of these searches will cost a maximum of £250.00 - a small price to pay for peace of mind.
UNREGISTERED LAND - land which has not yet been registered at the Land Registry.
If you would like any further explanations, please do not hesitate to contact us.
TOP TIPS FOR BUYING A PROPERTY...
SURVEY - Always arrange a survey for the property. Ideally, this should be done as soon as we have checked that the legal title is satisfactory. If your surveyor recommends some specialist reports, always try to obtain these - we would be happy to arrange these for you.
CENTRAL HEATING - Always test the central heating system. Your seller will not be responsible for any defects.
WATER PRESSURE - Always test the taps at the property for water supply and water pressure.
APPLIANCES - if any appliances are included in your purchase, always check that these are in good working order.
COMPLETION DATE - Try not to agree a specific date for completion when you are agreeing the price. Often delays can be caused in chains and with lenders and missing a previously agreed completion date can lead to frustration and anxiety for both parties.
HIP - Always ask for a copy of the Home Information Pack before making an offer. We would be happy to check the HIP (free of charge) to uncover any immediate problems before you make an offer. The HIP may lead to a good bargaining position.
NEIGHBOURS - Always visit the property at different times of the day. Your seller is unlikely to be in breach of contract for failing to disclose problems in the local neighbourhood.
BEFORE EXCHANGE - Always visit the property just before exchange of contracts - you will buy the property in the same condition it was in when you exchanged. We have seen situations where this was substantially different to the time at which our client originally viewed and made an offer. It is also worth taking photos at this stage.
STAY IN TOUCH - if you are going away or will be uncontactable during your purchase, let us know. Your seller will find it extremely frustrating if you disappear!
MORTGAGE ARRANGEMENTS - Always take advice from a mortgage broker before embarking on your mortgage application. This will ensure you get the best deal available. We would be happy to arrange an appointment with an excellent local broker on your behalf. Always apply for your mortgage early and make sure you have an agreement in principle before making an offer on a property.
INSURANCE - Always arrange your buildings insurance early - you will be required to have this in place from exchange of contracts. If you have a mortgage, we will need to comply with a number of requirements before we can exchange so be prepared.
FINANCIAL COMMITMENT - DO NOT make any financial or other commitments (such as removal companies, furniture and appliance orders, ending tenancy arrangements and and postal redirection) until contracts have been exchanged.
BE OPEN AND HONEST AND DON'T TAKE ANYTHING PERSONALLY - Always give clear instructions to us and the other parties involved. Moving house is stressful and finding out about last minute difficulties can be extremely frustrating and often lead to transactions falling apart.
THE LEGAL PROCESS OF SELLING...
THE LEGAL PROCESS OF BUYING...
From the date of agreeing a price for the property it can take, usually, between a few days and months to exchange contracts. It is entirely dependent upon:
