Exchanging contracts and setting a completion date is where all your hard work starts to pa off. Use this guide to help you through these final steps.
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You are contractually obliged to buy the property once contracts
are exchanged.
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Your solicitor holds your deposit which you pay at the time
of exchange.
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You will agree when the sale is to be completed and if this
is not honoured then penalties can be imposed.
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The contracts are only exchanged when your solicitor has received
satisfactory replies to their questions.
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Often your sale or purchase will be dependent on others buying
and selling properties - and that is called a chain.
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If this is the case the solicitors must coordinate transactions
so that completion of your sale and purchase take place on the
same day.
Insurance protection and why
Buildings insurance:
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Buildings insurance must be effective from the day of exchange
of contracts.
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Otherwise you could be jointly liable with the previous owners
for any damage caused to the property after that date.
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Once contracts are exchanged, you are expected to complete
the purchase even if the property is damaged.
Life and mortgage payment protection
cover:
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If the purchaser dies, life cover will pay for the sale, safeguarding
dependents.
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Make sure you also have protection for accident, sickness
and unemployment from the point of exchange of contracts.
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Enhanced cover - at a price - comes from income protection
or critical illness insurance.
The transfer deed
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This is the official record at the Land Registry that you
are the new owner.
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Your solicitor prepares the document before completion.
Completion
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When the Transfer Deed is completed it is sent to the seller's
solicitor.
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The process of completion involves handing over: keys, Land
Registry certificate, and Transfer Deed.
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Your lender holds the documents, as security against the loan.
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In return your solicitor is sent the 'mortgage' funds by the
lender to pay for the sale.
Stamp duty
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The law requires that the Transfer Deed is officially stamped.
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The Government imposes a tax - stamp duty - on all properties
over £60,000.
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This tax is paid by your solicitor and added to your bill.
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The stamped deed is then sent to the Land Registry to confirm
the new owner.
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It also registers the lender's interest as the mortgage.
Your rights when things go wrong
Moving house is always a stressful time, even when things go smoothly.
Here are a few tips for what to do if a problem does arise.
The survey
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If you find a serious fault which was not known at the time
of purchase, you first need to check the scope of the survey
you commissioned.
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A lender's survey simply verifies the loan for the lender-
you cannot rely on it to find serious structural problems. This
is why many purchasers, particularly of older properties, prefer
to pay for a more expensive independent survey.
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If you fee your surveyor should have found the fault, then
raise the matter with the surveyor's firm concerned. They will
have an internal complaints procedure.
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Your surveyor will be a member of the Royal Institute of Chartered
Surveyors, so you can also involve their arbitration scheme.
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If the worse happens and structural faults arise after you
have bought your home - consult the Citizens Advice Bureau or
a lawyer and sue.
The solicitor or conveyancer
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You may have a complaint over service, charges or financial
loss.
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Consult the complaints procedure provided by the Supervision
of Solicitors, the Law Society itself or the Council for Licensed
Conveyancers.
The removal firm
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Make sure you use one registered with the British Association
of Removers.
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Ensure you are fully insured - either through their insurance
or your own
The estate agent
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Before commissioning one, check they are in the voluntary
Ombudsmen of Estate Agents scheme. Not everyone is but it helps.
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As a seller, remember to ask family and friends about their
experience of local agents - do this before you sign any contract.
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Read any contract thoroughly before signing.
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The 1991 Property Misdescriptions Act is designed to stop
incorrect or misleading descriptions.
New build
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New homes aEnsure you are fully insured - either through their
insurance or your ownre guaranteed for 10 years under schemes
run by the National Building Council or Zurich assurance (01252
522000).
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They also offer an arbitration service to stop disputes escalating.
What to expect from your estate angent
At this stage of the home buying process the estate angent will be
working to liaise with solicitors, the seller and the buyer.
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You don't have to use an agent but you'll probably find selling
your home easier if you do.
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Just remember that the agent is working for the seller and
is paid a fee based on the price you pay.
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They are legally obliged to give an accurate description of
the property.
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False or misleading information is a criminal offence and
you can report them to your local trading standards office.
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If you are selling, check your contract carefully - particularly
any liabilities if you introduce a buyer direct.
