Conveyancing, leasing and Home Buyer Information Packs:
Everything you need to know
Here are some of the questions we answer every day:
Questions
Questions and Answers
What is a Home Buyer Information Pack?
That’s the question on everybody’s lips right now! Properties marketed for sale from 14 December 2007 in England and Wales must provide a Home Buyer Information Pack (HIP). This is designed to give important information about a property, such as an Energy Performance Certificate and a number of other compulsory documents.
The purpose of the Home Buyer Information Pack is to make the sales process more transparent, giving the home buyer a clearer, up-front picture of what he/she is buying – reducing the risk of nasty surprises later on.
Who needs a Home Buyer Information Pack?
If you're a seller, you need to make sure you have commissioned a Home Buyer Information Pack by the time you market your property. If you're a buyer, you should ask for the property’s Home Buyer Information Pack – as it provides essential (and free) information about the property.
What goes into a Home Buyer Information Pack?
The pack must contain the following documents, which must be no more than three months old when the property is first marketed:
Index Energy
Performance Certificate
Sale Statement
Title documents for the property
Local Authority and drainage searches
If the property is leasehold or commonhold, then the Home Buyer Information Pack must also include the following:
Copy of the lease
Building insurance policy
Contact details for the landlord or management and any legal details
Regulations that apply
Recent service charge receipts and accounts
We also recommend sellers include the following optional documents:
Home Condition Report
Home Use form
Home Contents form
Guarantees and warranties
Other relevant searches, such as a mining search
This Home Buyer Information Pack sounds like a major headache! Is there any way to avoid it?
Absolutely! Before you reach for the aspirin, talk to us. Our job is to take the headaches away. Just call us on 01639 884884 – or ask for a quote online.
Why should I use Sam Hawking & Co?
Quite simply, because you won’t get a better service anywhere else. Buying a property is the biggest financial decision most people make in their lifetime. And that’s a very good reason to be in the hands of Sam Hawking & Co – we’re professionals you can trust.
Our case tracking system allows you to get up to date information on your case 24 hours a day. So, whether you’re a home buyer or home seller, you can get on our case – while we work on yours!
To see how competitive our rates are, you can ask for our Quick Quote now. (And even if we’re not the cheapest – we’re certainly the best!)
Conveyancing is the legal process of transferring ownership of a property from its present owner to the buyer. Most firms of solicitors offer a conveyancing service, but the Citizens Advice Bureau advises that you get a solicitor who specialises in this type of work. At Sam Hawking & Co, we’ve built our reputation on conveyancing, and we pride ourselves on the quality of our work.
I am a home buyer – what do I do?
The short answer to that is contact Sam Hawking & Co and ask about our excellent buyer’s conveyancing service. From reviewing the Home Information Pack right through to completion date, we’re here to guide you every step of the way.
How long will it take before I can move in to my new home?
That’s the most difficult question of all! When we undertake conveyancing on a home buyer’s behalf we have to rely on local authorities, estate agents and others in the chain – which means we simply can’t give a definitive timescale.
What we can say for sure, though, is that your case will be reviewed daily and any necessary actions will be carried out immediately.
What do you mean by ‘searches’?
Before contracts can be exchanged, we must make sure that there are no problems with the ownership of the property, rights of way, access, or future developments in the area that might affect the property. These are called local searches and enquiries.
We will be carrying out a Local Search against the property on your behalf. This is an enquiry made to the local authority about any matters that might affect the property, such as proposed changes or developments in the area (eg roads, housing, shops). During the local search, the local Land Charges Register is also checked. This gives other information that might affect the property, such as tree preservation orders, conservation areas, listed building status and so on.
The Local Search covers only the land that you are buying and any proposed new roads or railways within 200 meters. If you would like to know of any other developments on adjoining or neighbouring property then we can also carry out a “Know your Neighbour” Search, which will reveal all planning applications made in the last five years within a 250m radius of the property.
We’ll also make enquiries to the seller on your behalf – a set of standard questions about the property, boundaries, neighbour disputes and fixtures and fittings that will remain in the property. We will also be carrying out environmental and drainage searches.
There may be additional questions that we think are necessary, such as the transferability of guarantees for any work done on the house (a damp proof course, for example).
We strongly advise that you consider carrying out a Chancel Repair Search. This reveals whether there is any liability on the owners to contribute towards repairs to the local parish church. (No, really – it does happen!)
Most local authorities return the results of searches within ten working days, although it can sometimes take longer.
Drainage and environmental searches take about 5 days, and mining searches are usually turned around by the Coal Authority in 2-3 days. Results for bankruptcy and Land Registry searches are virtually instant.
Do I need a separate survey, as I have paid a valuation fee to my lender?
The valuation carried out by the mortgage lender is not a survey. We strongly advise that you have an independent survey carried out on the property, which will assess the structure of the property and should identify any existing or potential problems.
There are two levels of survey that the home buyer can choose from:
A full structural survey is suitable for a property which is large, more than 80 years old or in dubious condition.
An intermediate survey is more suited to newer properties and is much cheaper than a full structural survey. This survey reports on the condition of the easily accessible parts of the house. The survey may recommend further specialised tests, such as dry rot or woodworm.
What is meant by ‘exchange of contracts’?
Exchange of contracts commits the buyer to buy the property and the seller to sell the property. Contract documents are signed and exchanged by both parties and the home buyer pays a deposit.
Once contracts are exchanged, both the buyer and the seller are legally bound by the contract and the sale of the house has to go ahead. If the home buyer drops out, he/she will lose their deposit.
When can contracts be exchanged?
Exchange of contracts should only go ahead when:
You are satisfied with the final outcome of all the enquiries
The surveyor’s report has been received and any necessary action taken
The formal mortgage offer has been received
Arrangements for the buyer’s deposit payment are in place
The date of completion has been agreed
Completion of the purchase usually takes place about four weeks after exchange of contracts, although it can sometimes be earlier.
What deposit will I need before exchanging contracts?
The deposit is usually 10% of the purchase price. However, you can sometimes arrange to pay a smaller deposit. If you’re also selling your home it’s common practice to put the 10% deposit on the property being sold towards the deposit on the property you are buying.
When do I pay stamp duty, and how is it worked out?
The home buyer must pay Stamp Duty Land Tax at a rate that depends on the property purchase price:
Up to £125,000 0%
£125,001 - £250,000 1%
£250,001 - £500,000 3%
£500,001 or more 4%
Stamp Duty Land Tax is not charged on residential transactions in 'designated disadvantaged areas' if the price of the property does not exceed £150,000.
Sam Hawking & Co will handle payment of Stamp Duty Land Tax on your behalf, along with the completed Land Transaction Return.
Is there anything I can do to save paying stamp duty?
If the asking price of the property is close to one of the thresholds for Stamp Duty, it may be worth the buyer negotiating with the seller to pay for various fixtures and fittings separately.
For example, if the property price is agreed at £252,000, you can suggest paying £250,000 for the house and £2,000 for the carpets. That way, you pay stamp duty at one per cent, rather than three per cent, and save £5,060.
But be warned: everything must be above board, and the Inland Revenue is tough on people who try to bend the rules.
Why do you need to know my National Insurance Number?
When we send your Stamp Duty Land Tax payment to HMRC, we also send in your Land Transaction Return. Your National Insurance Number is required information on this form.
What do we need to know if we are buying in joint names?
If two or more people are buying a property jointly, they will be joint legal owners. The agreement of all legal owners is needed if the property is to be sold, although if there is a dispute an owner can apply for a court order.
Most couples who are married or in a stable relationship purchase as "joint tenants", which means that upon the death of either owner, that person's half share will automatically pass to the other.
The alternative is to hold the property as "tenants in common", which means that each person's half share is treated as being separate - so that upon the death of one owner, his/her share will not automatically go to the other, but to whoever it has been left to in the deceased person's will. If there is no will, the property share will be left to the next of kin.
One further point: if you’re putting unequal amounts into the property, the person who is paying the larger amount can be protected by a "trust deed". This sets out your respective shares so that in the event of any dispute or upon death, both owners’ original investments will be clearly recorded.
What is legal indemnity insurance?
Sometimes there is a defect in the title or paperwork for the property. This could be anything from a restriction placed on the title or the lack of building regulation approval for an extension to the property.
The quickest and cheapest way to protect a buyer is to give indemnity insurance, which will protect the buyer against any action taken by a third party.
A one-off premium will have to be paid. It’s usually between £150 - £250 and paid by the seller of the property.
When do I need to arrange buildings insurance?
As a buyer, you should make sure that buildings insurance is arranged from the date of exchange, because once contracts have been exchanged you will be responsible for the property. If your lender is arranging buildings insurance as part of the mortgage offer, however, you do not need to worry.
Why does my lender want my adult son/daughter/partner to sign a Deed of Postponement or Waiver?
The lender may look for a Deed of Postponement or Waiver to agree a limitation on rights to the property. Should you fail to keep up mortgage repayments on your home and you are evicted, your adult son/daughter/partner must leave the property with you and will have no legal right over and above the lender’s right.
We ask for a small deposit to cover the cost of searches, obtaining copies of your title deeds and any planning permissions in relation to the sale.
All other fees and disbursements are payable after exchange of contracts but before completion.
When can I get the keys to my new home?
The keys to your new home will be released to you once the seller’s solicitor has received all of the purchase monies.
The purchase monies are transferred from one solicitor to another by Bank Telegraphic Transfer. This may take minutes or it could take several hours to get through – it all depends on how busy the Bank Transfer system is that day…
Where do I collect my keys from?
If you bought the property through an estate agent, that agent will hold the keys and will let you have them when the seller's solicitor has confirmed that the purchase monies have arrived.
If there is no estate agent involved, you'll need to collect the keys directly from the seller.
After I’ve bought the house, what else is there to do?
You should take final meter readings at the home you’re selling – if any – and take opening meter readings at the home you’re buying.
When you move in you should advise the statutory authorities and the Council Tax Officer at your Local Authority. Your lender (if applicable) will contact you about mortgage payments and if you’re the buyer we will deal with the final completion paperwork. This involves arranging for the Transfer to be stamped by the Inland Revenue and registering the Title with HM Land Registry.
As the whole process comes to an end, we’ll prepare your final account. If you’re selling, we'll pay the estate agent on your behalf and discharge any outstanding mortgage. If there's a balance due to you, you can expect to receive this within 2 - 3 working days of completion.
