So you’ve had an Offer Accepted – What now?
A buyer of real property must ensure that he or she obtains a good and marketable ‘title’ to the land; i.e., that the seller is the owner, has the right to sell the property, and there is no factor which would impede a mortgage or re-sale.
This process, is called ‘conveyancing’ and is carried out by your solicitor or property lawyer. They will ensure that you (the buyer) secure correct title to the land together with all the rights that run with the land, and that you are notified of any restrictions that may apply in advance of purchase.
Who to contact?
If you have not yet chosen a Solicitor/Legal advisor to do the legal bits, now is the time to do so. You should also contact your Mortgage Broker (or your Lender direct) to advise them that you have found a suitable property and had an offer accepted.
Hopefully you have already had an offer of mortgage agreed in principle and it will now be necessary to complete a formal application for the particular property. Your Lender will require a valuation to be carried out on the property. However, we would always recommend that as a minimum you commission a “Home Buyers” Report or, particularly if it is an older property, a full Structural Survey.
Getting the process started
Agent our contact details as your Solicitor (we hope that you would like to use our services) so that the Estate Agent can prepare and send out the Memorandum of Sale to the solicitors acting for each party. This document details the parties to the proposed transaction, the agreed sale price and any other relevant information eg the seller has agreed to include the shed in the purchase price.
The Contract Pack
Upon receipt of the Memorandum of Sale we will write to the sellers’ solicitor requesting the Contract Pack. Once the Contract pack is received and you have provided funds on account of the initial disbursements we will order the initial relevant searches that need to be carried out.
As standard we will need Local Authority, Water & Drainage, Environmental and Chancel Repair searches to be carried out. In some areas it is also necessary to carry out additional searches eg parts of the South West and Wales will require tin and coal mining searches and in London a London Underground Search but we can advise you fully upon these once we have details of the property you wish to purchase.
The Contract Pack and Property
Once we have received the search results, usually around two weeks from the time that we receive the contract pack from the sellers solicitors, we will prepare a Title Report for you in respect of the information that we have received and also send out to the sellers’ solicitors any additional enquiries which we need to raise.
If you have any matters which you specifically wish us to investigate or query, please let us know as soon as possible in order to avoid unnecessary delays in the process. Once we have received replies to any additional enquiries raised we will report to you upon these and obtain confirmation from you that you are happy to proceed to the next stage.
Hopefully you will also now have received your mortgage offer, a copy of which your Lender will send to us. We will write to you confirming the terms of the mortgage and pointing out to you any special conditions imposed. You will need to confirm to us that you are happy with the offer and we will proceed to prepare the Mortgage deed.
Often Lenders require you to specifically “accept” the offer. You also need to ensure that any Direct Debit Mandate has been returned to the Lender as they will not release mortgage funds until they are in receipt of all necessary documents.
Signing the Documents
Around this time we will ask you to sign the contract. You are not committed to the purchase until you authorise us to “exchange Contracts”, we are simply getting it signed in readiness for an exchange of contracts. At this time we will usually also ask you to sign the Mortgage Deed, Transfer (the document which transfers ownership on completion) and the Stamp Duty Land Tax Return.
Exchange of Contracts
Once you have confirmed that you are happy to proceed you need to provide us with the deposit funds, normally 10% of the purchase price. You will also need to agree with your seller a date for completion, i.e. moving house.
Once this has been agreed we will take your final instructions to ensure that you are happy to proceed with the purchase and assuming that you are, we will then affect an exchange of contracts. It is at this point that you will be committed to the transaction and the terms of the contract cannot be changed. If after contracts have been exchanged, either party tries to cancel or delay the agreed arrangements, then the other party will have the right to sue for damages.
Preparing for Completion
After exchange of contracts we will send what is called a Certificate or Report on Title to your Lender requesting the mortgage funds in time for the agreed completion date. It is our policy to request that the funds arrived the working day before completion to ensure that there is no delay on the day of completion due to the late arrival of mortgage funds.
Occasionally you will incur an additional day or so interest payment, but this is considerably less than the cost that would be incurred if completion were delayed to the extent that it caused a “breach of Contract” deemed to be your fault. We will also (if not already done) prepare you a Completion Statement showing the money already received from you on account of disbursements and in respect of the deposit, the amount received from your lender and the amount which we have spent on your behalf.
If there is any balance due to us to enable us to complete we will ask you to let us have this. Please note that any funds required for completion must be in our client account in cleared funds at least one working day prior to completion. If there is a balance due to you following completion this will be sent to you with our letter confirming completion has taken place.
We cannot guarantee what time actual completion will take place as much depends on how long the chain is and the time it takes for the money to transfer via the Banks. You will need to provide us with a contact telephone number for the day of completion and once we have heard from the sellers solicitors that they have received the funds and released the keys we will call you to confirm. You will then normally collect the keys from the Estate Agent unless we have notified you of any other arrangement. We would however mention that often the sellers solicitors call the Estate Agent first to confirm that the keys can be released and you will probably have the keys before we are even aware that the transaction has completed!
Whilst you settle into your new home we will deal with Stamp Duty Land Tax and registration of your title to the property at the Land Registry. Once the registration document is received (this process can sometimes take several weeks) we will send and copy of the entries to you for your records together with any other relevant documents that we have received relating to the property from the sellers solicitors.
Newnham & Jordan Solicitors offer a competitive range of legal services & advice including Conveyancing Solicitors and Property Lawyers in many towns in Dorset, Hampshire & Wiltshire.