Moving House Frequently Asked Questions

How long will the process of buying or selling a home take?

An obvious question, but one that is almost impossible to answer. Until our conveyancing team has prepared (when acting for a seller) or seen (when acting for a buyer) the contract package and made enquiries as to the position of the other parties in the chain, we are not in a position to advise as to the likely time frame.

However, the average time taken, from the point of our receiving your instructions to the exchange of contracts, is between six and eight weeks. That is not to say that if everything goes smoothly or proves to be straightforward, this can't be speeded up. It should also be borne in mind that when there are complications and difficulties (e.g. in obtaining a mortgage, chains breaking down, problems with the title deeds etc), the process can take considerably longer. The time between exchange of contracts and the completion date is usually agreed as a period of two weeks or more by both parties. This is necessary so that we can obtain mortgage monies and carry out the necessary searches. It also gives the client time to make their arrangements and start packing.

What happens if the other party pulls out?

Despite the frustration this causes there is nothing that can be done if this happens to you. No one is legally committed to buying or selling a home until contracts have been exchanged. It is not unknown for people to pull out of a transaction even when people are ready and waiting to effect an exchange. You are not entitled to any form of reimbursement for money that you have spent (e.g. on a local search, solicitors costs or survey report), or compensation in respect of the inconvenience, stress and other losses that you may have suffered. It is therefore advisable that you leave as many arrangements as possible until after contracts have been exchanged. Booking removal vans, instructing tradesmen to carry out property work and arranging time of work should all be left until after exchange wherever possible.

What happens if I pull out?

As stated above, you can pull out at anytime up until the contracts are exchanged. Your only liability up until that point will be for your own costs.

If you have agreed a "No sale, No fee" deal with us then we will charge no legal fee for the work done, although you will still be required to pay your disbursements.

What shall I do about getting a mortgage?

As stated above, you can pull out at anytime up until the contracts are exchanged. Your only liability up until that point will be for your own costs.

If you have agreed a "No sale, No fee" deal with us then we will charge no legal fee for the work done, although you will still be required to pay your disbursements.

What shall I do about getting a mortgage?

The majority of people need some kind of financial assistance when it comes to buying a property. Hunting around for the one that's right for you can become a bit of an ordeal. There are no hard and fast rules in finding the right mortgage, it is simply a case of shopping around for the one that best suits your individual needs. Coles Miller has an interest in a separate financial services company, Independent Mortgage Solutions, who are able to offer expert advise on mortgages.

What reports and surveys do I need?

The starting point is that the property is sold as seen. Therefore you are buying it based on your inspections of it and any reports that you have had carried out. Once you have exchanged contracts you have accepted the property in its current state and condition and you have no come back on the seller for matters you find out about later unless the seller has misrepresented something in writing to his solicitors (and then you would have to sue the seller if you knew where he then lived with the consequent costs and delay). Don't rely on a verbal statement by the seller. If it is important what has been said then insist the sellers solicitors confirm it in writing.

Any reports you require must be carried out before exchange. If the results are adverse then you can then look to renegotiate the price or the terms or even withdraw if that is necessary. Once contracts are exchanged everything is fixed and there is no obligation on the seller to renegotiate anything.

If you are having a mortgage, the lender will insist as a minimum that a valuation report is carried out. This is only a cursory look at the property and the valuer may only be at the property for 5-10 minutes. A valuation is merely to ascertain the value of the property for the benefit of the lender so that they can make a decision as to how much money they are prepared to lend to you to purchase the property. It may give general comments with regard to the condition of the property. If the valuer makes a mistake then the valuation is not worth the paper it is written on in terms of you suing the valuer or the lender. The valuation is prepared solely for the purposes of the lender and this is set out on the valuation document although normally in very small print. The only situation where it may be safe to rely upon a valuation report is if you are purchasing a brand new property with the benefit of an NHBC, Zurich or long term guarantee.

The next type of report is a Homebuyers Report. This is a much more detailed report on the property and the surveyor will probably need to be at the property for 2-3 hours in order to prepare it. A Homebuyers Report is normally at least 20 pages long as compared with the valuation which is normally only 1 or 2 pages. A Homebuyers Report costs approximately £450.00. However a Homebuyers Report has limitations and the extent of the surveyors liabilities is set out in the Report. The surveyor will only comment on what he can see and reasonably access. There will not be any testing of the services for example the drains nor the equipment for example the central heating system and boiler. If you want these items checked over then you will need to have a separate test by appropriately qualified people i.e. a drains company for the drain, a qualified NICEIC electrician for the electrics and a Corgi Registered plumber for the heating system. Any such reports should be instructed at an early stage and not at the last minute. This is so that there is time for the report to be carried out, their results considered and any further action necessary taken.

The other form of survey is a full structural. This is an even more detailed report on the property and the surveyor will be required to look at the whole property including any inaccessible parts by taking up carpets etc. The cost will be substantially more than a Homebuyers Report but may be necessary in some circumstances for example on a very old property or a property with serious structural problems.

At the end of the day you are probably acquiring the most valuable asset that you will ever own. Therefore before you commit yourself, you need to ensure that the property is in good order or that you are fully aware of the condition of the property, any works that are required and the cost involved in carrying them out so that you can budget accordingly and not have any unwelcome surprises after you have moved into the property.

The Governement Home Information Pack Scheme means that properties now placed on the market have a HIP which will contain an Energy Performance Certificate. This gives an indication of how energy efficient the property is and will suggest alterations that can be made to improve its efficiency. Any changes are merely suggestions and there is no legal requirement to carry these out.

Do I need a deposit?

The terms of the contract will usually provide for the payment of a deposit to the seller on exchange of contracts. The deposit is held by the seller's solicitor, or may have been used as the deposit on the sellers related purchase. Either way the seller does not have access to this money personally unless this has been agreed.

Ideally, a buyer should pay a 10% deposit, where they are obtaining a mortgage advance for 90% or less towards the purchase price. However as people often borrow more than 90% from their lender, it is usual for the deposit to be reduced accordingly, but this will still need to be agreed by the sellers.

If you are simultaneously selling and buying, it is usual for whatever deposit is received from your buyer to be forwarded to your seller's solicitor. It is rare (but not unheard of) for a seller to ask for deposit monies in addition to this. You may therefore be asked for additional funds ready for exchange of contracts if there is a large difference between the deposit being received and that being paid.

The buyer wants to set a price for the property and a separate price for carpets and curtains. Is this ok?

Stamp duty is payable on the purchase price of the property. This figure must include any sum paid for fixtures and fittings. There is however scope for excluding any sum paid for chattels. Unfortunately there is no legal definition of what is or is not a chattel or a fixture. As a general rule of thumb a chattel is anything that is capable of passing by delivery. Usually it is clear that items such as curtains carpets certain white goods etc are chattels. If it is clearly not a chattel, it is probably a fixture. Items such as central heating systems, fitted kitchen/bedroom units, light fittings (but not the shades) etc are clearly fixtures. As a general rule an item is deemed a fixture if it is fixed to the property and its removal would damage, in any way, the fabric of the property.

It is quite legitimate to set a separate price for chattels but the price must reflect correctly the value of the goods in question. If the goods are second hand then it must be the second hand value.

This point is important where transactions are at the thresholds where the stamp duty percentage increases. If the purchase price is under £125,000 no stamp duty is payable. Between £125,001 and £250,000 stamp duty is payable at 1% of the purchase price. Properties priced at between £250,001 to £500,000 have stamp duty land tax at 3% of the purchase price. Any purchase price over £500,000 stamp duty land tax is payable at 4% of the purchase price. There is a substantial difference between stamp duty payable at 1% and 3% so a splitting of the purchase price and chattels can be very important on properties at the point of which the stamp duty land tax payment increases. It is in order if the items are genuine chattels and the figure allocated to them correctly reflects the value of the items in question. The Inland Revenue do have the ability to run spot checks where, but for the payment for the chattels the duty payable would have been at a higher rate.

Stamp duty land tax is payable by the purchaser. The purchaser (or their solicitor) now has to complete a tax return with details of the transaction which is submitted to the Inland Revenue. The Inland Revenue have already indicated that they will be scrutinizing the returns particularly for those transactions at the threshold of the changes of the percentage. If your return is picked out by the Revenue and an incorrect figure has been allowed for chattels or the items are in fact fittings and not chattels at all then the Inland Revenue can demand payment of Stamp Duty Land Tax at the higher percentage. You will also be considered by the Inland Revenue to have committed tax evasion which is an offence punishable by imprisonment. Be careful!

When do I need to arrange buildings insurance?

Unless the building insurance is being arranged by your lender or it is a leasehold property and the insurance is dealt with by the freeholder you must arrange buildings insurance from exchange of contracts as the property will be at your risk from that time. The amount of cover should be the estimated cost of re-building the property if it burns to the ground which is not necessarily the same as the current market value. If you had a survey or you are obtaining a mortgage your surveyor or the lenders valuer will usually have suggested a minimum amount of cover in their report.