The practical and legal aspects of new property conveyancing are considered more complex than other types of conveyancing in the industry. Issues such as incomplete road and sewer agreements, lack of National House Building Council (NHBC) inspection, and planning regulation non-compliance can incur unnecessary expenses for you in the future. Risks that come with purchasing a new property are relatively higher; this is why a proper conveyancing process is crucial to the success of your purchase.
Working with a reliable conveyancing solicitor is vital in ensuring a smooth transition for you. In addition to addressing any of the possible issues mentioned above, a conveyancing solicitor will make sure that your reservation fee and deposit are ultimately protected, and the property contract favours you. Remember that a good conveyancing solicitor will not bend to the pressure from the property developer and always work out a solution to provide the best possible result.
Responsibilities of a Conveyancing Solicitor
Explain to you whether a property is a freehold or leasehold and identify any associated fees that come with it
Highlight restrictive clauses in the lease that can potentially prevent necessary property modifications in the future without paying the builder’s permission
Securing the planning permission and ensuring that the property was constructed following this
To help achieve a favourable outcome for your new build conveyancing, read on to learn all about the most critical aspects of the process that you must be familiar with.
Preparing for a New Build Conveyancing
Before new build conveyancing begins, several things have to be fulfilled first. Most property developers require secure mortgage finance before the exchange of contracts, so make sure that your finances are prepared.
If the property you are planning to purchase is not completed within the standard mortgage period of six months, you can either opt to apply for an extension from your lender or reapply for the mortgage later.
Assessing the Property
Before reserving a property, feel free to ask about all the important details, including structural instalments, electrical plans, and landscape drawings. You can also check out the other sites owned by the developer and evaluate whether your standards for your future property are met.
These property details decide the final price, so make sure you are aware of additional expenses that may be included in the computation. You can encounter developers who offer incentives instead of a usual fee, or those who include the costs of the stamp duty in the final charge. Cross-check all of these important details with your property seller.
After you have decided on purchasing a house and the deal has been closed with the seller, the conveyancing of the property can officially begin. It is best to find a conveyancing solicitor who can guide you throughout this process and meet legal needs relevant to it.
Reserving Your Chosen Home
Typically, a reservation fee is required to secure the property for around 28 days. The cost ranges from £500 to £2,000, or even higher for houses that are considered high-end. This reservation fee is not refundable in the case of cancellation but is deductible upon official purchase of the property.
Per the Consumer Code for Home Builders, a reservation agreement should specify the reservation cost, final purchase price, as well as miscellaneous service and management rates. Do not hesitate to clarify these details with the property developer or owner.
Paying the Property Purchase Deposit
In addition to a reservation fee, a deposit may also be required before purchasing a property. This typically costs 10 to 30 per cent of the final purchase price and is paid to the solicitor of the property’s developer.
Buyers often face this issue since mortgage lender property valuations occur at the start of a new build and after its construction is finished. If the rate falls within this standard period without you securing a mortgage for the remaining balance, the paid deposit may be deemed invalid because of a contract breach.
Note that this situation can result in the developer suing you for the difference between this much lower rate and the agreed property price. Therefore, we recommend you confirm with your seller whether the price is unconditionally “locked” upon exchange of contracts or adaptable to whatever rise or fall in price that may occur.
Keeping A Snagging List and Warranties
In many cases, property builders do not let prospective purchasers view a property until it is completed. Since a property can fall short of your lifestyle needs and standards, it helps to keep a snagging list and include a snagging provision in the contract. Take advantage of this stage to list down any defects you spot and bring this up to the builder for fixing. You can also choose to hire an expert who can survey the property on your behalf and identify significant structural errors, which can cost you more later on.
It is best to conduct your snagging survey just before the final payment is completed. This is because some developers and builders disregard requests for repair after a buyer has moved into the property. Remember, though, that they are ultimately responsible for fixes on any defects that take place within two years of your purchase.
After this period, your NHBC warranty can cover subsequent issues that need to be resolved in your property’s structure; many NHBC warranty insurances are valid for ten years. This is why a snagging survey is critical to ensure that any defects in the property are covered, or any future expenses are accounted for.
Completing the Final Stage
Upon completion of the construction of your new property, expect the official site handover to you. Relevant assets, including keys, logbooks, and owner manuals, are provided during this step. The important thing to remember is to secure copies of all documents related to your property. These may include white goods papers, window and roof installer guarantees, and so on.
New build conveyancing is an elaborate process that needs your full attention and the expertise of the professionals you work with. Employ the help of a reliable and skilled conveyancing solicitor who can ensure a convenient purchase and transition for you. There are several companies out whose services come with a conveyancing quote calculator, so you can already have an idea of the costs that the entire process may incur.
A comprehensive conveyancing process also ensures that specific regulations in your state are fulfilled and that you will not face legal issues in the future related to the purchase and transfer of your property. An excellent conveyancing professional will prepare necessary documents and ensure any contract conditions work for your best interests. A poorly handled conveyancing process can not only harm your property owner status but also cost you avoidable legal fees later on.
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