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Selling Guide

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The Guide to Selling & Buying

We all know that buying or selling house is incredibly stressful, apparently it's up there with divorce and bereavement.

Buying and selling a house isn't a piece of cake, but this twelve point plan should help to make your life easier; we've even included guidelines as to the paperwork which is required.

Before deciding to buy or sell, there's one important factor to consider- MONEY!!! Take a look at the Costs Involved and the Moving Checklist, and if you haven't given up on the idea, carry on with the centralparkestates.co.uk step-by-step guide.

1.    Making & Accepting an Offer

When Selling

bulletSeller finds a buyer
bulletHouse becomes classified as sold - subject to contract

When Buying

bulletBuyer finds a house to purchase.
bulletHouse becomes classified as sold - subject to contract

When you find a buyer or a house to buy, the house will be classified as sold subject to contract.

In a nutshell, this means the house is reserved until the signing and formal exchange of contracts. However, right up until the point contracts are exchanged, the buyer and the seller are quite within their rights to buy or sell another property. This can be frustrating in itself, particularly if the sale falls through several times. At that point some people decide to build an extension on the existing property, or try again in a year or so!

If you find a house to buy before you have sold or the other way round, it's a good idea to find out how long the other person is prepared to wait.

2.    Finding the Documentation

Questions

Just a few things to have a think about on the paperwork front (tick box for answer):

Have you changed your name?

Where are the deeds held?

Have you made any alterations or added an extension?

Do you have any guarantees i.e. treatment against woodworm, cavity wall insulation, electrical repairs, double-glazing insulation or any other alterations?

Was your property built under NHBC Buildmark/Zurich Newbuild or Rebuild Schemes?

 Are you selling a leasehold property?

3.    Organising the Survey

When Selling

bulletNothing for the seller to do at this point - so take it easy!

When Buying

bulletBuyer sets-up a mortgage
bulletLender arranges valuation/survey
bulletBuyer organises basic or full structural survey

 

It's a good idea to organise a survey of the property you intend to buy. A property is sold as seen. In other words the seller will not compensate you at a later stage, for things which you should have known prior to exchange of contracts.

Most of us will purchase with a mortgage from a bank, builder society or whoever (the lender). Even though the lender will arrange their own survey (valuation), it is still important to have your own survey. The money is well spent, although you don't appreciate this at the time! There are two main surveys available:

Homebuyer survey and valuation report - 

bulletIn other words a fairly detailed structural examination, which safeguards against the main structural defects.

Full structural survey - 

bulletThis is really only necessary with pretty old properties and covers a full structural building survey, picking up any major or minor faults.

If money is a bit tight, you can ask the lender to carry out a more detailed survey than the simple valuation.

4.   Prior to Exchanging Contracts

When Selling

bullet 
Solicitor obtains title deeds and information about property.
bullet 
Solicitor sends to the buyer's solicitor title deeds etc.
bullet 
Solicitor organises search of the local authority register.
 

When Buying

bullet 
Lender sends formal mortgage offer.
bullet 
Solicitor checks mortgage details.
bullet 
Solicitor prepares/approves the mortgages deeds.

It is now time to kick-start the legal work. If you are selling, your solicitor will already have obtained the title deeds to your house and information about your property, including fixtures and fittings.

Now this is where matters can get complicated, so listen carefully!

bullet 
The seller's solicitor, sends to the buyer's solicitor:

Copies of the title deeds
Contract
Property information form (which covers anything that may put you
off buying a property - disputes, rights, guarantees and so on).

bullet 
The buyer's solicitor then has a good read of the documents mentioned above and then may come back with some questions to "approve" the title and the contract.


Are you still with us?

bullet 
If a search of the local authority register has not been provided, then this will be organised. The search covers:

New roads
Planning consents
and so on......

Depending on the area, this may also include:

Drains
Railways
Waterways etc

bullet 
Once a formal mortgage offer is received from the lender, the buyer's solicitor will check that the details are correct and acceptable to the buyer. He/she will then prepare or approve the mortgage deeds and begin to make any arrangements regarding life policies.

Local Searches

Be prepared, the local authority search does not highlight all the information about neighbouring properties, so it is worth mentioning any worries to the solicitor. Local searches can take forever (anything from a few days to several weeks), so hang on in there. It is a requirement of the mortgage that the local search is carried out.

4.   Signing the Contract (getting there!)

When Selling

bullet 
Solicitor forwards contract for signature.
 

When Buying

bullet 
Solicitor forwards contract for signature.
bullet 
Solicitor requests contract deposit.
bullet 
Solicitor prepares report, explaining everything that has been found out about the property.

As the procedure is slightly different for the buyer and the seller, it's time to have a split:

For The Buyer

Having read through the local search and information about the property, the solicitor will ask you to sign the contract and pay the contract deposit. Sometimes a report is prepared explaining everything that has been found out. When reading through the report, have a little think about the following:

bullet 
Are you getting as much land as you thought?
bullet 
What fixtures and fittings are included in the price and what is extra?
bullet 
When do you want to complete?
bullet 
Do you have all the money to complete the purchase? As you've probably realised by now, this is an expensive business and the fees can soon mount up.

The The Seller

The steps to follow for a seller are so much easier, but you will still need to keep the following in mind:

bullet 
When do you wish to complete?
bullet 
Are you prepared to accept a reduced deposit (less than 10% of the sale price)?
bullet 
Have you enough money to pay off all your existing mortgages?

6.    Exchanging Contracts

When Selling

bullet 
Solicitor sends signed contract to the buyer's solicitor.
bullet 
Contracts referred to as exchanged.
 

When Buying

bullet 
Solicitor sends signed contract.
bullet 
Contracts referred to as exchanged.

Just because you've signed the contract, does not mean you are legally bound to buy or sell. This only happens when the contracts are actually exchanged. This is done by post or phone.

The buyer's solicitor sends the signed contract and deposit to the seller's solicitor. On the other side of the fence, the seller's solicitor sends the signed contract to the buyer's solicitor.

This is the point of no return, as once exchange has happened, you will be unable to back out of the transaction and committed to the agreed completion date.

OK, it's all down hill from here on.............

7.    Organising the Deposit

When Selling

bullet 
Not a lot of do here, so just sit back and take it all in.
 

When Buying

bullet 
Solicitor forwards seller a deposit at exchange of contracts.
bullet 
Deposit is usually 10% of the purchase price.

At exchange of contracts, the buyer is asked to pay the seller a deposit. If the seller is happy to accept a lower figure, then this can be arranged.

Although the idea of a deposit is a bit of pain, it does help to make sure that the buyer will follow through with a purchase after exchange of contracts. If you are selling and buying, you can sometimes use the deposit from your sale as the deposit on your new home.

If the deposit money is simply not available, a short-term loan (bridging loan) might be the best route to take.

8.    Agreeing the Completion Date

When Selling

bullet 
Solicitor agrees date for completion.
 

When Buying

bullet 
Solicitor agrees date for completion.

Before exchange of contracts takes place, the date for completion will be agreed on. This is the date on which you can actually move - at long last!

It will need to be convenient to you and all the others in the chain. The most frustrating thing in the world, is to organise all your personal arrangements and then find out that someone else in the chain is not ready to exchange contracts.

There is absolutely nothing in the world to stop exchange of contracts and completion, happening on the same day. Having said that (as a way of reducing stress), it is a good idea to give yourself ample time between exchange of contracts and completion.

The good news is that your solicitor will arrange the completion date for you, so just let him/her get on with it.

9.       Prior to Completion

When Selling

bullet 
Just relax!
 

When Buying

bullet 
Solicitor finalises conveyancing searches against the new home.
bullet 
Solicitor prepares outstanding documents.
bullet 
Solicitor arranges for the mortgage documents to be sent with any mortgage funds.
bullet 
Solicitor arranges to have the estate agent's account sent through.
bullet 
Solicitor repays any mortgages on the property.

Between exchange of contracts and the completion date, the buyer's solicitor will:
bullet 
Finalise conveyancing searches against the new home.
bullet 
Prepare any outstanding documents and arrange for the mortgage.
bullet 
Arrange for the necessary mortgage documents to be sent with any mortgage funds.
bullet 
Arrange to have the estate agent's account sent through.
bullet 
Repay any mortgages on the property.

In the case of brand new properties, the solicitor will instruct the lender's surveyor to carry out the final inspection to allow mortgage funds to be released. It's always a good idea to make a list of items, which you would like the builder to put right.

The solicitor will arrange for the remaining documents to be signed and check that all life and house insurances are set-up. Finally it's time to arrange for the keys to be released.

10.    Administration Side

When Selling

bullet 
Seller organises domestic items.
 

When Buying

bullet 
Buyer organises domestic items.

We've included a handy checklist, to help with the organisation of all the domestic items. So if you want to reduce the stress levels, this is the place to be.

 Don't book a removal company, until you have a definite moving date (when contracts have been exchanged and a completion date has been set).

11.    Completion

When Selling

bullet 
Seller drops keys off.
 

When Buying

bullet 
Buyer picks up keys.

Completion day has finally arrived - Yippee!!!! It's now time to pick up the keys from the estate agent, seller or representative at the site office.

In the case of selling, it's important not to hand over the keys to the old house, without checking that completion monies have been received with your solicitor/legal representative.

Moving Checklist

By way of getting all those domestic items organised, this checklist will prove invaluable. Print the list out, stick it on the fridge and you're all set.

It’s easy….as you complete each item then place a tick in the box.


bullet 

 5 Weeks to Go

 
  Check out the local services and amenities in your new area
 
  Investigate schools in your new area, including enrolment requirements and transfer of school records
 
  Start looking at transport in your new area - plan your new route to work  
 
bullet 
 4 Weeks to Go  
 
  Book time off work. If someone is helping you move, make sure they are available on your moving day
 
  Start clearing up. Give the items you don’t need to a charity shop, or pop along to a car boot sale
 
  Start collecting packing materials
 
  Book a removals company
 
  Arrange insurance for the move
 
 
bullet 
 2 Weeks to Go  
 
  Inform all the necessary organisations about your change of address to let them know you are moving. Don’t forget to tell the following:
   
  Local authority
 
  Electricity and gas supplier
 
  Satellite/cable television
 
  Telephone company
 
  TV licence
 
  Water company
 
  Bank
 
  DVLA (driving licence)
 
  Employer
 
  Let the post office know you want to redirect the mail
 
  Start to use up the contents of your freezer
 
  Organise for someone to look after any children and pets during your move
 
  Make a plan of your new home; decide which rooms are to be used for what and where the furniture is likely to be placed
 
  Prepare a list of furniture and other things you will need to buy for your new home
 
  Start packing - label each box (in theory this makes unpacking easier)
 
 
bullet 
 1 Week to Go  
 
  Arrange for the final bills to be paid
 
  Have the meters read and pay any outstanding amounts
 
  Confirm arrangements with utility companies
 
  Cancel any regular deliveries, for example, newspapers or milk
 
  Return any library books
 
  Arrange the day for exchange of keys
 
  Give a plan of the new property to the removal company
 
  Start cleaning the house
 
  Send change of address cards to family and friends
 
 
bullet 
 1 Day to Go  
 
  Finish packing everything, excluding items needed for the night and journey
 
  Defrost the fridge and freezer
 
  Finish cleaning the house
 
  Dismantle large furniture if possible, to make it easier to move
 
  Make sure there’s enough petrol for the journey
 
  Ensure valuables and important documents are kept together and keep them with you for the journey
 
  Take down any curtains, mirrors or lamp shades you are planning to take
 
  Make sure all the cupboards and drawers are empty
 
 
bullet 
 Moving Day  
 
  Disconnect any remaining appliances
 
  Walk through the house to check everything before the van leaves
 
  Ensure all doors and windows are shut
 
  Pick up the new keys and deliver your old ones as arranged
 
  Make sure the removal company knows how to reach your new address, give them a contact number
 
  Try to arrive at your new address before the removal van and check over the house
 
  Check that everything has been delivered
 
  Read the meters in your new home
 
  Check that your phone, gas and electricity are working
 
  Make the bedrooms fit for sleeping – it’s a tiring business moving house!
 
  Uncork a bottle of champagne and celebrate in style

Cost Involved

There’s no getting away from it, house buying costs money. Without looking at removal expenses, new fixtures and so on, the ‘compulsory’ fees soon add up.

Before contracts are exchanged on your purchase, you should make sure that you have enough money to complete the deal. Have a think about the following essentials:
bullet 
Purchase price, or if you are taking out a mortgage, the difference between the purchase price and the mortgage.
bullet 
Money to cover any retention or deductions made from your mortgage.
bullet 
Cost of the valuation report, prepared by the lender.
bullet 
Cost of any fixtures and fittings for which you have agreed to pay extra.
bullet 
Survey for the property (various price ranges available).
bullet 
Stamp duty and land registry fees to register your ownership of the property.
Other financial considerations include:
bullet 
Hiring a removal firm.
bullet 
Redirecting the mail.
bullet 
Taking a homebuyer’s insurance policy, which covers against legal costs, should post-purchase disputes crop up.
bullet 
Mortgage payment protection, to cover the monthly payments for a set period, should you become too ill to work or suddenly lose your job.
That’s all very well, but what about some real costs ? centralparkestates can help you there.

The following costs are based on Mr. & Mrs. Average, purchasing a £100,000 house – be prepared the total can be quite frightening!

Real Costs

bullet 

Description
Cost

 

Lender’s valuation

£175

 

Solicitors’ fees

£500

 

Home buyer’s survey/full structural survey

£350

 

Land Registry fee*

£100

 

Local authority search

£75

 

Stamp duty*

£1,000

 

Redirecting your mail

£21

 

Sub Total (excluding VAT)

£2,221

 

VAT

£388.68

 

Grand Total

£2609.68



* Exempt from VAT

Notes: In Scotland the Registry fee comes out at £220. The home buyer’s survey assumes a basic one. A full structural survey would cost nearer to £750.

 

 

 

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Last modified: November 23, 2002