This section outlines
general guidelines for buying your new home.
Before considering any property you need to carefully budget.
This entails calculating the funds at your disposal either
on deposit or cash, estimating the value of your equity in
your existing house, if applicable, getting a quote from a
Solicitor of the costs involved in purchasing and finally
establishing the level of loan for which you will qualify
with your Bank/Building Society.
Usually you contact your Solicitor and complete the Information Sheet to instruct them to act and they will open a file and commence the transaction.
Once you have decided to proceed with the purchase of the house and have been approved, at least in principle, for the loan, you should pay a booking deposit to the Estate Agent. This deposit is refundable and is usually up to 2% of the purchase price. When the Estate Agent receives the booking deposit they issue a sale details to all parties.
This is prepared by the Estate Agent and issued to you, your Solicitor and the Builder's Solicitor. It contains the price, conditions of sale, estimated closing date, names and addresses of all parties.
The Builder's Solicitor on receipt of the Sale Details, will issue the Contracts. The Contracts are sent in duplicate together with a copy of the Title Deeds and Building Agreement to your Solicitor.
Once your Bank/Building Society has formally approved your loan in writing on the basis of the price of the house and information furnished by you, a formal loan pack is issued. Normally a Letter of Offer setting out the main details of the loan is issued to you and the Loan Pack comprising Mortgage Documentation, Acceptance of Letter of Offer and Assignment etc., is issued to your Solicitor.
When your Solicitor has checked the Contracts (see 5 above) you will be required to sign the Contracts in duplicate and pay the Contract Deposit (10% of the purchase price less booking deposit already paid). With a new house you may not be obliged to pay a full 10%, instead a reduced payment (called a stage payment) is accepted. The amount of the stage payment is specified by the Estate Agent at the outset.
When your Solicitor has checked the Loan Pack and discussed key terms with you, various documents are signed and completed to enable the Bank/Building Society proceed.
Your Solicitor returns the Contracts and Building Agreements in duplicate signed by you together with the Contract Deposit/Stage Payment to the Builder's Solicitor.
The Builder's Solicitor returns one copy of the Contract and Building Agreement. This creates a binding agreement between all parties, subject to the terms and conditions contained in the Contract.
On exchange of Contracts at 10 above, your Solicitor returns the loan acceptance and ancillary documents to your Bank/Building Society.
When the house is finished the Builder sends you and your Solicitor a "Completion Notice". This is an important document and sets the meter running against you within which time period you must finalise completion. Immediately on receipt of the Completion Notice you must "snag" the house. This is a formal inspection by you or your agent to establish that the house has been finalised. You draw up a list of any unfinished works. This list, known as a "snag list", is prepared in duplicate and one copy retained by you and the other handed to the Site Foreman. You should contact the Site Foreman within a number of days to check if all the items of the "snag list" have been completed and that exercise should be repeated until all matters have been dealt with. Immediately the house has been completed to your satisfaction you should inform your Solicitor.
Your Solicitor will prepare a Statement setting out the balance required to complete the purchase and costs. This is sent to you in advance of the completion in order that you can deliver the balance of funds to your Solicitor (see 15 below). This takes into account any extras or allowances agreed by you and the builder.
This is received in advance of the completion date.
These are delivered by you, by Bank Draft made payable to your Solicitor in advance of the completion date. Normally the loan cheque and balance of funds are received the day before the completion date.
The completion is the formal completion of the purchase. This takes place at the Builder's Solicitors offices. You do not need to attend as your Solicitor will represent you. Your Solicitor checks the Vendor's Title and when he/she receives good Title with fully signed documents hands over the balance of the purchase price. At that stage keys are not handed over to your Solicitor. Instead the Site Foreman is contacted by telephone following completion of the transaction and informed to release the keys to you. Usually you collect the keys from the Site Foreman.
After the sale is completed you must sign the Purchase Deed. This document is only handed over to your Solicitor at the closing and is not available for signature by you prior thereto. You must sign immediately following the closing as there are strict time limits for stamp duty.
Following signing by you of the Purchase Deed your Solicitor will proceed to stamp the Purchase Deed and Mortgages and then register same in the Land Registry/Registry of Deeds. Registration can take months, if not years, depending on the County and type of property involved.
At this stage you are registered as owner of the house in either the Land Registry or Registry of Deeds. Legal ownership to the property passes to you on completion of the purchase but registration may take a minimum of months or longer. This delay does not in any way undermine the fact that you are the legal and beneficial owner of the property. Indeed you can sell a property even though registration has not been finalised in the Land Registry or Registry of Deeds.
Your Solicitor, on completion of registration, returns your Title Deeds, to your Bank/Building Society together with a Certificate confirming that you have acquired a good marketable Title. Usually, you will be notified that registration has completed and the Title Deeds have been returned. At this stage your Solicitor closes off your file.
Good Luck!
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