Rowberry Morris, Solicitors, Gloucester - Residential Conveyancing Procedures

Buying and Selling Your Home

What is involved?

The sale or purchase of a property usually takes place in two stages the first leading to an exchange of signed contracts and the second leading to completion. Until contracts are exchanged the agreement to sell or buy a property is not binding on any party who can withdraw at any time without reason and without paying compensation to the other.

Once contracts are exchanged however the agreement is then binding on all parties and if any party withdraws from the contract they would have to compensate the other for any loss which may be suffered as a result of breaking the contract.

If you are selling a property you will (as from the 1st June 2007) have to provide a Home Information Pack (HIP) containing legal and other information about your home, including an energy performance certificate before you can place your home on the market for sale.

If you are considering marketing your home we can arrange for a HIP to be prepared for you so that as soon as a buyer has been found for your home we will be in a position to send a contract of sale to the buyer.

To assist us with the completion of the HIP we will ask you to complete a Property Information Form giving information about the property personally known to you and a Fixtures Fittings and Contents Form listing the contents that you will be leaving at the property or will be taking with you on completion of the sale.

The buyer will be relying on any of the above information you provide in which case it is most important that the information you provide is accurate and true.

If you are buying a property it is important that both you and we are satisfied with a number of issues before you commit yourself by exchanging contracts. Broadly these are as follows:

That the preliminary searches carried out against the property do not reveal any matters which are adverse to the property.
That we are satisfied with the title to the property.
The sellers have not revealed any information concerning the property which might be of concern to you (for example neighbour disputes, problems with boundaries or intended building on adjoining property).
That your financial arrangements are satisfactory. This is particularly important if you are having a mortgage.
If necessary you have had a survey of the property carried out.

The time scale will therefore depend a lot on whether your seller needs to buy another property or your buyer needs to sell his own property and if so how long the “chain” is in each direction. If all the matters in the “chain” are interdependent then we can only proceed when everyone has satisfactorily completed all their preliminary searches and enquiries and have made their financial arrangements.

Usually on exchange of contracts a deposit of 10% of the purchase price is paid on the property being bought. If a sale is involved we would usually be able to use any deposit received on the sale for the property being bought.

On exchange of contracts a completion date is agreed and this is the date when ownership of the properties will pass, when you can move into the property you are buying and when you must leave your present property to allow your buyer to move in. There can be a gap of anything between a few days and a few weeks between exchange of contracts and completion depending upon the circumstances. Sometimes the completion takes place at the same time that contracts are exchanged.

Between exchanging contracts and completing there are a number of matters that we will have to attend to and a number that you will deal with. Please see our final reminders checklist below of matters to attend to before completion.

We have to carry out final searches to check for example that there are no mortgages on the property that you are buying that the seller has not revealed. The transfer (that is the document that will pass ownership of the property to you) has to be signed, as does any mortgage deed.

Finally on the day of completion:

This will be hectic for you but equally for us. If you are both buying and selling we will not be able to complete the purchase of your new property until we have received the sale proceeds of your present property. If the chain is lengthy it can take some time for the money to pass through the hands of the various solicitors and this can add to the delay. It can also add to the frustration, especially if your removal van is full of your furniture outside your new house.

For our part we do all we can to ensure that completion does take place as quickly as possible. We have a computer terminal linked to our bank so that we can check regularly to see if the money on your sale has arrived. We can then instruct our bank via the terminal to send out the money immediately on your purchase. Delays in this part of the transaction are therefore kept to an absolute minimum as a result.

When you are selling your property we will pay off your existing mortgage. We will also pay your estate agent once you have authorised us to do so.

Once we have completed the purchase of your new property we will then have to apply for title to be registered at H M Land Registry. This usually takes five to eight weeks. When the title is registered we will send you a copy to keep for future reference.

Final Reminders

Following exchange of contracts for the sale or purchase of a property you will need to attend to the following:

Services
Water Services
Council Tax
Removals
Mortgage Payment
Life Insurances
Building Insurance
Television Licence
Keys

Services
Arrange to have the gas and electricity meters read and for the contract for the supply of the services to be transferred. Contact British Telecom to arrange for the contract to be transferred and the central meter read.

Water Services
We will not make apportionments of water rates as between Seller and Buyer on completion. The Water Company now carry out this apportionment. For the sale of an existing property they will bill you up to the date of vacating the property and if you have made an overpayment they will let you have a rebate direct. You will receive an account from the date you move into your new property in relation to that property. You should contact the appropriate Water Company requesting the apportionments.
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Council tax
Contact the appropriate District Council to advise them of your change of address. If you are moving between different districts the two councils will make apportionments as for the Water Rates.
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Removals
You should only confirm your booking of a removal firm once contracts are exchanged. If you are undertaking removals yourself you should note that your household contents policy is unlikely to cover goods in transit and you should therefore make special arrangements with your Insurance Company.
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Mortgage payment
On your sale you should cancel your Standing Order for your monthly payments once contracts are exchanged. If by chance the Lender (e.g. bank or building society) over calculate the amount which we will have to pay to redeem your Mortgage through having not taken into account a subsequent payment this will be refunded. Following completion of any new Mortgage the Lender will write directly to you advising you of the date on which your Mortgage repayments will commence. This is normally two to four weeks after the date of completion.
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Life Insurances
You will be on risk to complete the purchase of the property with effect from the date when contracts are exchanged. It is important therefore that any Life Insurance Policy you have arranged (e.g. to cover the repayment of the mortgage) is ready to be put in force immediately on exchange of contracts. Often this will be done by your Lender for you. Unless you give us instructions to do so however you should make arrangements yourself with your own Broker or directly with the Insurance company to ensure that all will be ready for the Policy to be made effective from the date of contract.
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Building Insurance
The same comments apply in relation to buildings insurance. If you are having a mortgage on your new property then normally the Lender will cover the property automatically. If you have arranged for your own cover however you should ensure that the Policy will be in force with effect from the date of contract.
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Television Licence
You should update your television licence with your new address. Contact TV Licencing, Barton House, Bond Street, Bristol, BS98 1TL. Telephone (0117) 937 7500.
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Keys
In relation to the property which you are purchasing you would normally make arrangements to collect keys directly from the Seller or from the Seller's Estate Agents. If you have any difficulties in obtaining confirmation from either the Seller or the Agent as to where the keys are you should contact us immediately. Please let us know what arrangements you will be making for handing over the keys of your property be it either directly to the Buyer or through the Agent or indeed myself. If you intend to hand over the keys personally to the Buyer this should not be done until such time as you have checked with us that completion has taken place and the Buyer's Solicitors have paid over to us the balance of the purchase price.