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Advice for Buying New Build Properties

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New Build Properties

Advice for Buying New Build Properties

When buying a new build property you will complete a reservation form on site reserving the plot you are interested in. The builder will normally have a fixed period within which you are expected to exchange contracts and commit to the purchase. It the property is built and ready for completion there is no problem and a fixed date for completion can be given. However, if the property is not ready for completion at the time of exchange, then completion will be on notice. This means that once the property is ready for occupation the builders’ solicitors will serve notice to complete to us and usually we then have 10 working days within which to complete.

There are added complications to buying a new build property in this way

If you already have a home that you are selling have a buyer and the new build property you want to buy is not ready you would either need to have other accommodation to move into until it is ready OR rely on your buyer agreeing to complete your property on notice and wait for the new property to be ready
You need an offer of mortgage to be able to exchange contracts. Most mortgage offers only have a lifespan of 6 months and then they need to be renewed, so if you are buying on an estate which is very early on in its development, you need to be aware that your mortgage offer may need to be renewed before completion which may mean you could not obtain the same mortgage deal you had previously been offered.
Quite often people buy houses with the assistance of a Help to Buy equity loan. This enables you to borrow up to 20% of the purchase price from the Government with no repayments on this portion of your loan for the first 6 years. If you were to take advantage of this offer then you need to make a separate application to the Help to Buy Agency to get approval for the loan.
The HTB Agency will issue an offer of loan which is referred to as Authority to Proceed. They have procedures to be followed and once all the legal enquiries are completed then an application must be made to HTB Agency for an authority to exchange. Once this is received contracts can be exchanged. Once the new property is ready then a further application must be made by the solicitors to HTB Agency and they will then issue a further authority to complete. Once this paperwork is completed it is the instruction for the HTB Agency to pay the equity loan share of the transaction directly to the builder on completion. Please note additional legal costs will be incurred in dealing with a HTB Equity Loan.

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Frequently asked questions

A right to buy purchase is when you are exercising the right to buy your existing rented property from the Housing Association or local authority you are renting from.

When a property is purchased in more than one name there are two ways to hold the property in trust: Beneficial joint tenants which means the property is jointly owned and on the death of one the property is automatically owned by the survivor Tenants in common which means the property is owned by the parties in whatever shares they decided ie 50-50, 60-40 but when one party dies their share of the property must be dealt with in accordance with their will or the laws of intestacy, there is no automatic ownership by the remaining parties. Sometimes the division of ownership for tenants in common is more complex than merely a percentage split for instance if one person puts a larger deposit into the property than the other. In such a case we would recommend a Declaration of Trust be entered into between the parties. This document can be as simple or complex as necessary to reflect the wishes of the parties buying the property. There are additional fees for the preparation of a Declaration of Trust.

A remortgage is the transferring of your mortgage from one lender to another usually to get a better rate of interest. Once your new mortgage offer has been issued, we would obtain copies of your title, and a repayment figure from your current lender. Provided there are no unusual requirements in your new mortgage offer we would then apply for that mortgage advance, repay the current mortgage and pay any balance to you if appropriate.

Sometimes it is possible to buy a property which is shared ownership which means you buy a percentage share in the property and rent the remaining share from a Housing Association who own the remaining share. The percentage purchased can start at as little as 25% and you have the ability in the purchase to buy additional shares (called staircasing up) in the future should your finances allow. What percentage you could initial purchase would be dependant on the requirements of the seller. If you are buying an existing property which is shared ownership and advertised with an Estate Agent you would need to approach the Housing Association who own the remaining share to get their approval of you as a buyer. What this would entail would depend upon the terms of the initial shared ownership scheme. Some shared ownership houses are built as such because the property is in an area where it is difficult for first time buyers to get on the property ladder and in these cases it is likely that you must have some connection to the area.

When someone dies their property will either need to be sold or transferred. If the property has been left to a named person in a will then a form of Assent is prepared which is a document the Executors of the deceased estate sign to put the property into the name of the beneficiaries.. If the property is to be sold then the sale will be by the Executors who take out the grant of probate of the deceased person. Whilst the property can be advertised and a sale agreed it is important to note that the sale cannot complete until the Grant of Probate has been issued. We work alongside our own Private Client team as well as other firms of solicitors in these matters.

Taking the right advice and doing as much preparation in advance of the auction date is always advised. When you buy or sell a property at auction, unlike in a normal situation, there is no opportunity to ask questions of the sellers as once your bid is accepted and the hammer falls then the agreement to buy and sell is binding and a completion date is set. If you pull out of the purchase at this stage you will forfeit your deposit and be open to further action from the other party for compensation. Ideally you should ask us to check over the auction pack before the auction takes place so that it can be checked whether there are any title problems or other things that need to be drawn to your attention before you make a successful bid. If you require Vincents to check the auction pack and provide a report to you on the legal title then we would ask for a payment of 50% of our normal fee plus vat. Should your bid be successful then upon completion the other 50% of the fee would be payable.

A transfer of equity is when a property is transferred from one name to another/one name to two/ two names to one. It is a simple process of putting an additional name on the title or removing a name. However if the property has a mortgage on it and this mortgage is not being repaid then you would need first to approach your lender to obtain their approval to the transaction. Once the lender agrees and the matter completes the person being removed from the title would also be released from the obligations under the mortgage.

Once you have instructed us, we will open a new file and issue our client care documentation for you to sign. Your client care pack details many important points relating to your matter, which include the scope of our instructions and estimated legal costs, our service and terms of business, data protection form and anti-money laundering forms. You will also be requested to provide ID and source of funds documentation, if applicable.

You need to speak to a firm who has experts in dealing with whatever particular problem that you have whether that be Divorce, Writing your will, Conveyancing or something more specialist like Medical Negligence Misdiagnosis Claims or Trade Marks and Patents. At Vincents we have specialists across 7 locations who are approachable, knowledgeable and speak in plain english. Try and call us today and find out if we are the right fit for you.

Conveyancing Clients Reviews

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Conveyancing Testimonial

Extremely Responsive

My wife and I have used Vincent solicitors for conveyancing since 2005 and for every property I’ve bought they have provided a consistently great service. They are always extremely responsive which helps enormously to speed the transactions along and they have always shown a high level of expertise. That expertise was especially useful in our most recent house purchase, which saw us move from a city centre property in the South East, to rural Cumbria. For this purchase June Caunce was our conveyancer and she helped guide us through the intricacies of easements, septic tanks, boundary issues and more! These are all elements we had not encountered before and so having a local and knowledgeable firm helping us was vital in covering off those elements, ensuring the purchase went smoothly.

A Owens, Chorley Chorley Residential Conveyancing

Conveyancing Review

5 Star first class service

My partner and I recently used Vincent’s for the selling and purchasing of our new home.

The service from all departments and staff was first class and nothing was too much trouble.

Very knowledgeable and always responded with questions promptly when asked.

We have used Vincent’s many times in the past and we have recommended them to family and friends who have also used them previously with some family members using them at present.

Highly recommended and I would not hesitate to use them again.

Save your time browsing through others and make the call to Vincent’s.

5 star from us.

W Marsden, Sale and Purchase Chorley Residential Conveyancing

Conveyancing Testimonial

Dedication and Willingness to help

When a family member passed away, we needed to sell their property. I could not have chosen a better conveyancing solicitor than Vincents Solicitors for this process. It can be a stressful journey, but luckily, I had a cash buyer with no chain, which made it slightly less complicated. However, there were still many intricacies to work through, such as collaborating with my fellow executor in Australia, which Vincents handled with ease. Their team’s dedication and willingness to help with every hurdle made the process as smooth as possible. Also, them being local to my home in Euxton made meetings and signing documents highly accessible, and I loved supporting a business in my area. Vincents’ no-nonsense approach and friendly service gave me peace of mind throughout the entire process, and I would wholeheartedly recommend their services to anyone needing conveyancing support.

A Brown, Bolton Chorley Residential Conveyancing

Conveyancing Testimonial

Extremely Responsive

A Owens, Chorley Chorley Residential Conveyancing

Conveyancing Review

5 Star first class service

My partner and I recently used Vincent’s for the selling and purchasing of our new home.

The service from all departments and staff was first class and nothing was too much trouble.

Very knowledgeable and always responded with questions promptly when asked.

We have used Vincent’s many times in the past and we have recommended them to family and friends who have also used them previously with some family members using them at present.

Highly recommended and I would not hesitate to use them again.

Save your time browsing through others and make the call to Vincent’s.

5 star from us.

W Marsden, Sale and Purchase Chorley Residential Conveyancing

Conveyancing Testimonial