Eight legal terms every home buyer should understand
Buying a new house is an exciting and joyful time, but it can also cause quite a bit of stress and confusion. For first time buyers especially, the terminology used can be unfamiliar and easily lead to misunderstandings.
However, it is vital that all buyers, and especially those new to the process, have a thorough understanding of the various terms and phrases that will be used along the house buying journey, as this article shows.
First up – conveyancing. This is a legal term, which basically means the process by which a property is transferred from the old owner to the new owner.
You may have also heard properties referred to as either leasehold or freehold. A leasehold property means that you will own the property, but only a share in the land on which it is built. A leasehold property is commonly a flat, and there will likely be maintenance fees to be paid on an annual basis to maintain communal areas.
A freehold property is one where you will own the property and the land it is built on too.
There are two types of main survey usually carried out. A valuation survey will be done if you are applying for a mortgage, to ensure that the property is worth the amount you wish to borrow. A structural survey looks at how sound the physical structure of the building is and is important in spotting any potential issues such as subsidence.
You solicitor should carry out a range of searches prior to any sale going ahead. These include environmental issues and that any relevant planning permission has been sought etc.
Disbursements are basically fees such as stamp duty, which your solicitor should pay under instruction from you. These are different to conveyancing fees https://www.samconveyancing.co.uk/news/conveyancing/conveyancing-costs-explained-3366
7. Title deeds
These are the legal documents which set out your rights as a property owner, as well as details of the property.
8. Exchange and completion
Exchange is where signed contracts are swapped. Once this is complete, it is hard to pull out of the sale. Completion follows on fairly quickly, and is when the rest of the money is transferred and the buyers become the legal owners.