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Buying A Property In The UK

Buying a property in the UK can be a complex and lengthy process, however, with the right legal advice from Bloomsbury law, our specialist lawyers and trained team members will ensure that the conveyancing process is as straightforward and time-efficient as possible.

Below we explain the basics of a legal process of purchasing the property

(1) After selecting a suitable investment or residential property, it has to be decided whether the property will be registered as single or joint ownership. In the UK, there exists a regulatory requirement of providing ID’s and declaring a source of funding, before any negotiations take place.

(2) Finding a mortgage: when it comes to finding a mortgage there are several options: mortgage brokers, individual banks or searching online.

(3) Once you’ve found the property, you will need to make an offer for it. Usually this will be done through the estate agent. You can do this without already having an agreement in principle in place but having one means the offer is more likely to be accepted and everything going through smoothly. If the seller agrees to the offer then the buying process can go ahead. It’s worth noting that you won’t be obliged to go through with the deal if there’s a problem with the survey or contract.

(4) Once you agree with the purchase you normally have to pay 10% of the property value into the law firm’s Client Account and then the solicitors for the seller and the buyer proceed with the exchange of Contracts, completion of purchase and registration of the property under new proprietor’s name at the UK Land Registry. Most conveyancing processes have a timescale of four to six weeks.

(5) Arrange a survey: A survey assesses the property for any potential problems with the property as this may affect the final price. Your lender will also insist on getting the property valued to check that it’s worth the asking price. There are three types of survey you can chose from:

  • Condition report. The cheapest and most basic survey, it tends to be used on conventional homes or new builds. It doesn’t include a valuation or investigate possible future repairs.
  • Homebuyer report. More expensive and thorough, this examines both the inside and outside of the property and includes additional valuation.
  • Building or structural survey. The most comprehensive option, this is more suited to older or unusual properties like converted barns.

(6) If your solicitor and surveyor are satisfied with all conditions, now is the time to sign the contract and exchange with the seller. At this stage you have to pay a deposit; usually 10% of the total price. Once this happens the buyer and seller are committed to the sale. Pulling out of the deal means you’re likely to lose your deposit.

7) Completion: This is where the property actually becomes yours. Recommended time between exchange and completion is around two weeks, however in some instances it is possible to exchange and complete on the same day. When you get your keys and deeds, you have to pay the following:

  • The remaining cost of the property (usually 90%). This is transferred from your mortgage lender to your legal representative and then to the seller’s representative.
  • Your solicitor or conveyancer’s fees.
  • Stamp duty (a government tax). The payments will be arranged by your solicitor or conveyancer. UK stamp duty is explained below.
  • Any removal costs.

Stamp Duty

The Government changed the rate of stamp duty at the end of 2014.  The flat rate scheme based on house price is no longer applicable. Now stamp duty is charged at different rates depending on how much of the purchase price fits into each price band as explained below:

  • Nothing on the first £125,000 of the property price.
  • Then 2% on anything over £125,000
  • 5 % on anything over £675,000
  • 10% on anything over £575,000
  • 12% on the rest

Buy-to-let landlords were hit with new costs as a controversial extra 3 per cent stamp duty charge was introduced and from April 2106 anyone purchasing an additional property must pay an extra 3 % stamp duty.

How To Choose The Right Property Solicitor →

We have a dedicated property team with extensive experience in property law to help guide you through the process. Call one of our dedicated property solicitors now on 0207 998 7777.

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