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Legal Terms Explained |
Please click on the words to find out the meaning.
This is the date (that is agreed between all parties, at the time of Exchange of Contracts) that transfer of the ownership of the property takes place and parties move in/out. The completion date is virtually guaranteed, but occasionally things can go wrong, such as delayed mortgage monies or monies being sent to the wrong bank in error, or one party not being able to move out. This does not happen very often.
This is the written agreement that is made between the Buyer and Seller and sets out the terms on which the property is being bought and sold. There are two identical parts of the Contract, and the Buyer signs one and the Seller signs one in readiness for Exchange of Contracts. The Contract also deals with what will happen should mattes go wrong.
This is the interest rate of the Contract should the Contract not be completed on the Completion Date. It is usually 4% above the base rate of a High Street Bank.
The deposit is what is paid to the Buyer's Solicitors upon Exchange of Contracts, and is usually 10%. Sometimes a lower figure is agreed when the Buyer is not contributing 10% of the purchase price from his own funds, for example if he is obtaining a 95% mortgage loan for example. If the purchase does not go through for any reason and it is the fault of the Buyer, the full 10% will become due to the Seller.
Sometimes, where there are linked transactions, the deposit will be used in those linked transactions.
This is the most important part of the whole Conveyancing Process, and is the time when the Seller becomes legally obliged to sell the Property to the Buyer, and the Buyer becomes legally obliged to buy the Property from the Seller. Until this moment, nothing is legally binding on either the Buyer or the Seller, and either can walk away from the transaction with no consequences.
This is a form which contains a list of what the Seller is leaving at the property, what he intends to take from the property, and any items which he wishes to sell to the Buyer. The form is completed at the outset, and is handed to the Buyer's Solicitors when matters get underway. The Buyer should check this form very carefully to ensure that he is getting what he thought was agreed when the offer was made. The Seller should ensure that he retains a copy of this form so that when he leaves the property, he does not take anything that he said he was going to leave, as this could result in a breach of Contract and completion could be delayed.
This describes that ownership is of both the buildings and the land that the buildings stand upon
Her Majesty's Land Registry is the central organisation that maintain the records of the ownership of land and all matters associated with that land.
This is a document which states the property's boundaries, the Tenant's obligations and the Landlord's obligations, the rent and service charges payable, who is responsible for the insurance and so on.
Please see Leasehold Information page for further details.
This describes that ownership of the property is on a "temporary" basis and upon expiration of the Lease the ownership reverts back to the owner of the Freehold (the Freeholder)
This is a document which is applied for at the Local Authority and contains questions concerning Roads, Planning Applications and Building Regulations, whether the property is in a Conservation Area, and other issues concerning the property which the Local Authority have an interest in or control of.
This is a loan which assist you financially in the purchase of a property. The Mortgage is attached to the property. Mortgages come in various packages, which various ways of paying them off, varying interest rates, and varying terms and conditions attached to the Mortgage. You need to be in possession of a valid Mortgage Offer before Exchange of Contracts can take place.
This is also sometimes referred to as the Legal Charge and is what is signed by the Borrower prior to completion of the Purchase and Mortgage.
This is the final payment made to the Mortgage Company.
This is the process that is carried out by HM Land Registry once Completion has taken place. HM Land Registry alter their records to show the new owners details, the price of the property paid and any new mortgages taken out on the property.
This is a tax charged by the Government when a property is bought. It is charged by way of percentage as follows:
£0 - £60,000 @ 0%
£60,000.01 - £250,000 @ 1%
£250,000.01 - £500,000 @ 3%
£500,000.01 and over @ 4%
There are also certain "Wards" which are exempt from Stamp Duty up to £150,000.
To find out if your property or the property you wish to purchase is in one of the disadvantaged areas please use the Inland Revenue's Post Code Checker (please ensure you are connected to the Internet)
This is a report on the physical aspects of the property. It is your responsibility to ensure that the property is physically sound, so should you not have a survey on the property, and you find defects after you have completed, you will have no one to claim from. If you are obtaining a Mortgage, they will insist upon a Mortgage Valuation. This must not be confused with a survey as it merely concerns itself with whether the property is of sufficient value to protect the Mortgage Company's interest.
We recommend that you obtain a Home Buyer's Survey carried out by an RICS Surveyor. To find a surveyor please click on this web link http://www.rics.org.uk/public/find_a_surveyor.html or alternatively they can be telephoned on 0870 333 1600 or e-mailed contactrics@rics.org.uk
Title Deeds and Documents are Official Land Registry Copies of the records held at HM Land Registry. If there is a Mortgage on the property then your Mortgage Company will hold the Title Documents, or will have given the Land Registry authority not to have issued a Charge Certificate.
Other Title Documents will include the Lease, any NHBC documentation, and any other official document affecting the title.
In the now rare cases of Unregistered Property, the Title Deeds act as your way of confirming your ownership of the property.
This is the document which is signed in all cases by the Seller, and in some cases by the Buyer, which transfers the ownership of the property between them. It is dated on the day of Completion, and is sent to HM Land Registry to enable the Registry to amend their records.