Our concise guide to the process of a house purchase
You have found the house you would like to buy, and our team have negotiated an agreeable price. What happens next?
The estate agent you are buying from will: request proof of your identity and address to satisfy AML (Anti money laundering) legislation. They will ask you to demonstrate your ability to purchase by requesting proof of funds and/or approval of your mortgage and they will request details of the solicitor that will act for you. (Please see below for information on choosing a solicitor). They will then write to you, the seller and the solicitors acting for both parties providing details of the sale. Then the conveyancing will start. Transactions typically take between 12 and 16 weeks from this point.
Conveyancing is the legal and administration process associated with the transferring of land or buildings from one person to another. This can be a straightforward paper exercise but may involve a range of more complex tasks so it’s important to get the right advice.
Finding the right solicitor or conveyancer for you
Many factors can affect your choice of solicitor, such as cost, location, personal recommendation etc. We advise you to instruct a solicitor in whom you are comfortable and completely confident. Clear communication is vitally important as is ease of contact and your adviser’s ability to explain legal matters clearly.
It is always best to meet with or at least speak to a solicitor before instructing them. You may have questions to ask, and you should be looking to build a working relationship with your adviser. We recommend using local solicitors, they have first-hand knowledge of our area which can prove invaluable.
Some agents and financial advisers are paid large fees to introduce clients to out of area conveyancing factories. We believe you should be paying for a quality legal advice, not a cheap solicitor and a huge introduction fee. We suggest you avoid this type of arrangement and ensure you get the best possible advice when it comes to buying your most valuable asset.
Once you have chosen your solicitor, you should ensure that you discuss any aspects of the transaction that you do not fully understand. Your solicitor should explain the main steps involved in your purchase and keep you informed throughout the transaction.
Submitting your mortgage application
You have chosen your solicitor and the selling agent has written to all parties. Your solicitor will send out initial paperwork, which you should complete and return as quickly as possible. They will also request “funds on account”: an amount of money required to start work on your file; typically, £400. You need to pay this promptly or your purchase cannot progress.
You have probably had initial advice from a financial adviser. If not, now you have found a property, it’s time to get the right advice and promptly submit your mortgage application unless you are lucky enough to be buying with cash. It is always best to see a mortgage advisor who offers whole of market advice. They will help you find the most suitable mortgage and deal with the paperwork associated with the application. Once the application has been processed and the mortgage valuation or survey carried out and everything approved, the lender will send a mortgage offer to you and your solicitor. Your solicitor will then ensure that all the requirements of the offer are satisfied during the legal process.
During the mortgage application process the property will be valued by your lender. You will probably choose to have a survey carried out to ensure that the condition is as you expect.
Types of survey:
Full Building Survey
This is the most comprehensive survey and is suitable for all residential properties. It’s particularly good for older homes or homes that may need repairs. This type of survey typically costs upwards of £800 and can provide detailed advice on repairs. It’s very extensive and in some circumstances worth the extra money but it does not usually include a valuation.
Although this survey can’t look under floorboards or behind walls it should include the surveyor’s opinion on the potential for hidden defects in this area.
The surveyor should also provide information on potential repair options
A Homebuyers Report is a survey suitable for conventional properties in reasonable condition. Costs start at £600.This type of survey will help you find out if there are any structural problems, such as subsidence or damp, as well as any other unwelcome issues inside or out. The surveyor will not look under the floorboards or make any intrusive investigations but will make general comments on the overall property condition. Some homebuyer’s reports include a valuation.
When you apply for a mortgage, the lender will undertake a Mortgage Valuation. This can involve visiting the property but may be a desktop valuation carried out remotely. The main purpose of this type of survey is to assess whether the property represents suitable security for the amount of money you are borrowing. This is not really a survey as such and may not pick up defects or faults which you may wish to know about. It is carried out with a view to protecting the lender not the purchaser. The cost of a mortgage valuation varies from lender to lender. Sometimes the lender covers the cost.
While you are applying for your mortgage, both solicitors will be working on the conveyancing. The seller’s solicitor will be preparing the draft contract pack “initial paperwork relating to the sale” which they will send to your solicitor. This will include the “Protocol Forms”, a list of the fixtures and fittings included or excluded from the sale and a questionnaire about the property completed by the seller. The questionnaire contains detailed information regarding the property, such as utility providers, planning, works carried out during current ownership and any guarantees or warranties which are in place. The pack will also contain detailed title information and a plan obtained from the Land Registry, along with the contract which the seller’s solicitor intends to use to transfer the ownership of the property.
In the case of leasehold properties, additional information will also be obtained and forwarded to your solicitor including: details of the management company, ground rent and service charges payable, any restrictions which apply to the property and management company accounts. Obtaining this information from third parties can take additional time.
Once your solicitor receives this initial information, they will review it and then apply for appropriate searches. These cost around £300 depending on exactly what’s required and might include:
- Local Authority Search
- Water and Drainage Search
- Environmental Search
- Chancel Search
Local authority search
This search will reveal specific information regarding a property and the surrounding area. It takes about two weeks in Teignbridge. It provides information about some or all of the following: planning applications, listed buildings, conservation areas, tree protection orders, improvement or renovation grants, smoke control zones, future developments, nearby road schemes and motorways, road proposals by private bodies, public paths or byways, advertisements, completion notices, houses in multiple occupation, noise abatement, urban development areas, enterprise zones, simplified planning zones, land maintenance notices, mineral consultation areas, hazardous substance consents.
Water and drainage search
The main information which this search reveals is whether the property is connected to a mains water supply and sewer, whether the property has a water meter and where the drains and sewers are located.
This search will reveal whether there are any environmental issues which affect the property. The search contains information on historical land use and any contamination issues. It may also reveal if an area is affected by radon gas, if there are issues with ground stability and the reasons why along with, and flood risk may also be highlighted.
This search will reveal whether the property is located within an area where the owner of the property is at risk of potential chancel repair liability. This is a historic financial liability, which means you could have to contribute to cost of repair of nearby religious buildings, normally churches.
In certain circumstances other searches may also be required. A mining search could be required to check if mines run under or near a property. This would only be required in an area where mining has occurred previously. This would be highlighted in the environmental search.
Once the contract pack and searches are to hand, your solicitor will review the information they contain and then “raise enquiries” with the vendor’s solicitors. Enquiries are questions and requests for additional information. These relate to any matters which are unclear in the paperwork received. It could be as simple as needing to know when a central heating boiler was installed or a far more complex matter. The vendor’s solicitor will then liaise with the vendor and potentially third parties to gather the information required to formally answer these questions. This is referred to as replying to enquiries.
If incomplete or unsatisfactory replies are received, the purchaser’s solicitors will raise further enquires until they are satisfied with all the answers.
In most instances your solicitor will also act for your mortgage lender and will have an obligation to ensure that all the requirements of the mortgage offer are complied with. Occasionally the mortgage lender appoints an independent solicitor to do this.
Once all the questions have been answered, your solicitor will prepare a detailed report for you. This will go through the title documents, replies to enquiries and your mortgage offer explaining the relevant parts of each. Once you have reviewed this and are happy, you will sign legal documents in readiness for exchange of contracts. These consist of the contract and mortgage deed and in some cases other documents. They will also provide a completion statement detailing the financial aspects of the transaction, including a breakdown of all the fees and disbursements incurred. This will enable the buyer to understand what monies are required in order exchange contracts and complete the transaction. At exchange of contracts a deposit of 10% is normally payable.
Exchange of Contracts
Once your solicitor is happy with the legal paperwork, they will liaise with you and others involved in the chain and agree a completion date. This is the day when you will become the owner of your new home. Estate agents will normally assist with agreeing the date. Although dates can be discussed at an early stage in the transaction it can prove problematic should unavoidable delays occur, so we do not recommend this. The completion date needs to be agreed and deposit monies lodged with your solicitor before Exchange of Contracts can take place. Your solicitor will also need to carry out a bankruptcy search on each purchaser and anyone who has gifted funds towards the purchase prior to exchange.
Once contracts are exchanged, the transaction is legally binding, so neither party can pull out or change the completion date without legal consequences.
The usual method of exchanging contracts today is by telephone; the seller and purchaser’s solicitor will read out the details of the contract and agree the exchange verbally. They then send their client’s signed copy of the contract to the other solicitor along with the agreed deposit. The deposit will normally be held by the seller’s solicitor until completion.
This is the day that all parties have been working towards when buyers get the keys to their new properties and sellers not buying on can bank the proceeds of sale. In advance of completion, the purchaser’s solicitors will have ensured they hold sufficient funds to conclude the transaction. These will have been previously detailed in a completion statement and the deposit and costs will have been requested from the buyer. If a mortgage is involved, they will have arranged for the lender to send the mortgage funds. In the event of a cash purchase, the deposit and purchase price are effectively the same.
On the day of completion, the buyer’s solicitor will forward sufficient monies to the vendor’s solicitor to conclude the purchase by electronic transfer. When the funds arrive in the vendor’s solicitor’s account, completion has taken place; the buyer becomes the new owner and keys can be collected.
The seller’s solicitors will ensure that their client has signed a transfer in readiness and will send it to the purchaser’s solicitors. They will have also obtained a redemption figure from the seller’s lender if they have a mortgage and have a legal obligation to repay this loan from the funds received. Usually, the seller’s solicitor will also settle third party bills such as estate agent’s invoices for convenience.
On the day of completion, a seller should aim to be packed up and ready to vacate a properly by around noon. The completion times can vary and there needs to be some give and take from all involved, so everything runs as smoothly as possible. Estate agents can assist with co-ordinating matters and the release of keys.
After completion has taken place the seller’s solicitor will send to the purchaser’s solicitor the signed transfer, along with any original deeds and guarantees they may hold. The purchaser’s solicitor then submits an application to the Land Registry in order to register the title in the purchaser’s name. They will also need to submit a stamp duty return form along with any stamp duty payable. The Land Registry may take several weeks before they formally record the details of the new owner as, although the seller’s solicitor will have repaid any charges (mortgages) on the day of completion, Land Registry will require confirmation of this before doing so.
Costs related to purchase are substantial so you will need to plan ahead. They also vary considerably depending on your circumstances, the type of property you wish to buy and the price you are paying. It is therefore not possible to provide accurate figures relating to your particular purchase here. We would be happy to discuss these with you if you contact us.
Costs you will need to consider include:
Deposit. This is likely to be your largest cost. You will normally require 5% of the purchase price as a minimum. The more deposit funds you have available the better. A larger deposit can enable you to access more attractive mortgage rates.
Mortgage application fees. These vary from lender to lender and can be dependent on the type and amount of the loan you are taking. They will be detailed on your formal mortgage quote and on your mortgage offer. Application fees may or may not include an amount for a survey or valuation. Guide £0 to £1000.
Survey costs. These are variable dependent on the of type of survey and the size of the property. Guide £400 to £1200.
Solicitor’s fees. Although the amounts solicitors charge vary, we recommend that you choose the one you feel will work best for you rather than the cheapest. Guide £700 to £1500 for a sale or a purchase.
Disbursements. The amounts solicitors pay out on your behalf for searches, bank transfers and sundry items. These are often similar irrespective of the solicitor you are using; a directly applied for Teignbridge search for instance costs the same regardless of who applies. The overall cost of disbursements is typically £300-£400.
Stamp Duty. SDLT (Stamp Duty Land Tax) This is one of the biggest expenses related to a purchase. We have a useful Stamp Duty Calculator enabling you to work out any potential costs here.Stamp Duty Calculator
Removal costs. Typically range from £1000 upwards dependent on how much you are moving and how far. You can consider doing this yourself, however it can be more work than you think so consider carefully before taking this on.
Costs of any essential works. You should consider any works you wish to carry out at the property or works recommended by your surveyor. It is often prudent to obtain quotes for these prior to exchange of contracts so that you are fully aware of potential future costs.
For information on selling a property please refer to our concise guide to selling your home.
Read our Top Tips for Buyers here.
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Ms B (December 2023)
To Coast n Country, especially Tom! Thankyou for getting my home sold with very little stress. And Tom, thankyou for finding my new home. Best Team Ever Thankyou Ms B..."
Mr H (September 2023)
Just about to complete on the sale of my house and the whole experience has been fantastic from start to finish. Callum and the team have been in constant communication with me throughout the whole..."
Mrs G (September 2023)
Brilliant team. I would choose coast and country every time for selling my property. Tom is just amazing, patient, easy to talk too and a massive help. Great service. Mrs G (September 2023)..."
Mr K (October 2023)
Tom at Coast and country in Newton Abbot was extremely helpful when we viewed the property which we eventually brought. As a disabled person he went above and beyond what could reasonably expect him..."
Miss M & Mr M (November 2023)
To Tom, Darren & The Team at Coast & Country, Thankyou for getting us through the sale of "21" amd for the purchase of "66" for me. All your help through the whole process is much appreciated. from D..."
Mr T (November 2023)
To the Coast & Country Team, Thank you so much for all your help! You've all been amazing! From A (November 2023)..."
Mr & Mrs J (June 2023)
A Great Big Thank You Thank you so much - Hope you know how much it is appreciated! To the team at Coast & Country You have been amazing. Biggest Thank you Mr & Mrs J (June 2023)..."
Mr S & Mrs K (June 2023)
To all the team at Coast and Country. You have made us very happy! Thank you all. Mr S & Mrs K (June 2023)..."