GET IT RIGHT FIRST TIME: Sarah Gaunt is here to help first time buyers get to grips with the conveyancing process. This month, she takes a look at some of the financial issues that can cause confusion…
When should I apply for my mortgage?
There are many different mortgage options available to first time buyers and you may need to put aside a little time to find the best one for you.
Various third parties, such as independent financial advisers, banks and building societies, can help and advise you in choosing the best mortgage deal.
If you are unsure who to approach, ask your solicitor for recommendations – we are only too happy to point you in the right direction.
I’ve had second thoughts about the house I am buying. Can I withdraw from the purchase?
You can withdraw from a property transaction at any point before exchange of contracts.
You will, of course, lose any money you have paid for surveys and searches and you will have to settle your solicitor’s fees for work undertaken on your behalf so far. It may seem unfair, but this is also the case if the chain falls apart because someone else changed their mind.
If you are selling a house and you withdraw from the transaction, you will also potentially incur estate agency fees, on top of any solicitors’ costs.
The conveyancing laws in England and Wales allow any party to withdraw from an agreed sale or purchase at any time, prior to exchange of contracts, without being responsible for other parties’ costs. However, after this point, you are legally committed to complete the transaction and no one can pull out without incurring financial penalties.
Do I need to pay a 10% deposit on exchange of contracts?
This is commonly thought of as the standard procedure for buying a property, but it is not always the case.
Although contracts usually stipulate 10% of the purchase price should be paid on exchange, sellers will often accept a lower deposit. This is a matter for negotiation that you will potentially need to iron out at the point your offer on the property is agreed.
For people who are selling as well as purchasing, it is possible in many cases to pass on the deposit you receive to the owners of the property you are buying, even though, again, it may not be the full 10%.
If you are worried about finding the required deposit by exchange of contracts, this is something you need to discuss with your solicitor, who will advise you on the best way to minimise the amount you are required to pay up front.
If you are a first time buyer with a question about moving home, our residential property expert, Sarah Gaunt, would love to hear from you. Email: marketing@tayloremmet.co.uk.
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