How to buy & sell

Buying and Selling with Lucas Estate Agents

 

Whether you are buying, selling or doing both at the same time, Lucas Estate Agents have the experience and knowledge to help you every step of the way – whatever your reason for buying or selling.

 

At Lucas Estate Agents our aim is to simplify the whole sales/buying process, keeping you informed and offering advice and guidance to help you achieve what you want.

 

You can get on with every day life knowing that our vast experience and knowledge is there for you when needed.

 

The Buying Process - Mortgages - The Lenders Valuation - The Sales Process - Home Information Packs (HIP's) - Costs of Buying and Selling - Stamp Duty - Estate Agency Agreements - Common Questions

 

The Buying Process

 

A simple step by step guide

 

  • Check out your finances.
  • Get your mortgage agreed in principle.  Call John Betts Mortgages Ltd 01536 312945
  • Decide how much you want to spend.
  • Get an idea of what you can get for your money, click on the 'properties For Sale' button to the left.
  • Decide what sort of property you want.  Register your details with Lucas Estate Agents and receive regular updates of new properties available by post or e-mail.  Click on the 'Register With Us' button on the left.
  • View suitable properties.  Click on the 'contact us' button on the left.

TIP     Don’t try to view too many properties in one day

 

  • Find a property and make an offer “subject to contract”.

At this stage an estate agent will require proof of your identity and full details of your financial arrangements, in particular the source of any cash used in whole or part (e.g. Deposit) of the purchase.  Any suspicious arrangements have to be reported to NCIS (National Criminal Intelligence Service) under the latest money laundering legislation.  www.ncis.gov.uk

 

  • Contact John Betts Mortgages Ltd and complete your mortgage application with your chosen lender.  Pay valuation or survey fee (explanation below).
  • Instruct a legal representative to act for you.  Pay money for local search and initial disbursements.  4 bedroom properties placed on the market for sale after August 1st 2007 will have a Home Information Pack (HIP) that will include certain searches.  From September 10th 2007 3 Bedroom properties coming new to the market must have a HIP.  Other properties will eventually be required to have a HIP but as yet when this will be is unclear - see the Lucas News section for latest information. Your legal adviser may need to make additional searches and may, in many cases, need to renew the search provided in the HIP if it is out of date.  Some lenders will not accept searches that are part of a HIP supplied by the seller!
  • Receive mortgage offer and copy of valuation/survey report (most lenders will let you have a copy of the valuation).
  • Advise Lucas Estate Agents of any concerns, who will assist you in getting any additional reports/estimates required by the lender as a condition of granting you a mortgage.

TIP     Some reports are free, others will be charged for, especially plumbing and electrics.

 

  • Once the mortgage is confirmed check that your legal representative is carrying out any searches that may be required.
  • Confirm that your legal representative has received draft contracts and answers to enquiries from the sellers legal representative.

TIP     If you have holidays booked, or if you are going away for any reason let your legal representative and the agents know the dates in advance.  If possible provide both with contact numbers or an e mail address.

 

  • Arrange with your legal representative to sign the contract and pay your deposit, stamp duty if applicable and balance of legal costs.
  • Exchange contracts – You are now legally committed to buy the property.  Your legal representative will give you a completion date.
  • Arrange immediate insurance cover.
  • Start finalising your move

A free home moving checklist is available from Lucas Estate Agents

 

TIP     Free change of address service at www.iammoving.com

 

  • Completion day – The property legally becomes yours and you can move in.

TIP     You can only have the keys when the sellers legal representative has received all of the purchase monies which can be anytime on completion day depending on the length of the chain.

 

  • Move in

 

TIP     Check meter readings

 

Don’t worry about what is involved in buying.  Lucas Estate Agents are with you every step of the way.  You can let our experience guide you and simplify the whole process.

 

ADVICE

For your own peace of mind change the locks and alarm code (if installed).  Check other security arrangements (window locks, door bolts etc).  Join any organised neighbourhood watch scheme immediately.  neighbourhood watch

 

More Helpful Tips for Buyers

 

  • When you pay for anything by cheque, nothing will happen for 5 working days while the money clears!  That includes valuations, searches and deposits used for exchange of contracts.

Some legal firms will not accept cash.  Some firms will accept a building society cheque and in certain instances where the amount is relatively small may treat this as an immediate payment and not wait for the building society cheque to clear.  However, the only way to be absolutely sure that the money is immediately available for use by your legal representative is to provide them with a bankers draft or have money TT’d (telegraphically transferred) direct from your account to your legal representative.  We cannot emphasise too much that the monies used for the deposit to enable exchange of contracts must be given to your legal representative in good time.

 

  • Let us know if you have any holidays booked and let us and your legal representative have contact numbers.  There may be documents to sign or money to be paid before you go so to avoid delays, check with your legal representative and agent in good time before you go away to see if anything needs a signature or if they need any money from you.
  • Get your mortgage agreed in principal before you go viewing.  Sellers will take you more seriously and you will avoid possible disappointment.
  • Have ID to hand (photo driving licence or passport) together with proof or residence (utility bill in your name and with current address that is no more than 3 months old) it will be needed by the agents, mortgage advisor and legal representative.

Mortgages:-

 

A simple step by step guide

 

What is a Mortgage?

 

A mortgage is a long term loan to help you to buy a property.  The word itself means any loan that is ‘secured’ against the property.  This means that when the property is sold, the lender has ‘first charge’ and must be paid first from the proceeds of the sale.  A typical mortgage lasts for 20-25 years but shorter or longer terms can be arranged.

 

Types of Mortgage

 

Variable Rate

  • Payments go up and down in line with interest rates sometimes referred to as standard variable rate (SVR).

Capped Rate

 

  • Interest rate is variable with an upper maximum for a guaranteed period.

Collared Rate

 

  • Interest rate is variable but cannot go below a minimum specified rate.

Fixed Rate

 

  • Means fixed payments for a guaranteed period.  This will revert to the standard variable rate at the end of the period.

Discounted Rate

 

  • Start with a discount off the standard variable rate, for a limited period.
  • After discount period, rate reverts to standard variable rate.

Flexible Rate

  • Allows you to vary your payments.
  • You can also take payment holidays, subject to certain conditions.
  • Gives you potential to pay off your mortgage early.

Buy to Let

 

  • For a property you want to buy and then let.

Let to Buy

 

  • For a property that you already own and probably live in.  Releases the capital so that you can let your existing property and buy a new home.

Cashback Feature

 

  • Pays a cashback to you after completion
  • Helpful for fees etc

Some types of loan may have an arrangement fee, some may have a redemption penalty especially during a fixed or discounted period and sometimes beyond; different loan products may also have exit fees (an administration charge paid to the lender at the end of the loan and/or in addition to an early redemption penalty).

 

How Much Can I Borrow?

 

What will it cost?

 

How should the loan be repaid?

 

How do I apply for a mortgage?

 

What else is involved?

 

Contact John Betts Mortgages Ltd

At Lucas Estate Agents, direct line Tel: 01536 312945

 

How much paperwork is involved?

LOADS! But John will do most of it for you.

 

Tip  Keep your bank statements and payslips in a safe place so that, if needed, you can produce the last 3 months quickly for your mortgage adviser and lender to see if needed.

 

YOUR HOME IS AT RISK IF YOU DO NOT KEEP UP REPAYMENTS ON A MORTGAGE OR OTHER LOAN SECURED ON IT.

 

The Lenders Valuation

When you make an application for a mortgage the lender will require a valuation that you will pay for (at the time that you make the application), unless the lender has a special scheme where no valuation fee is payable by the borrower (i.e. you).

 

  • If you are asking for a loan to buy a property then the lender will want to be sure that:-
  • The property exists and that it is what has been offered for sale.
  • That it is a suitable type of dwelling for security.

Some lenders will only lend on certain types of property. e.g. some lenders will not lend on certain 'system' built houses or houses with a flying freehold.

 

TIP If the property you are considering purchasing is not of a conventional nature or if part of the first floor extends over the neighbouring property ground floor then you should discuss this with your mortgage arranger as it may affect where the loan application is placed.

 

  • That it is worth what you propose to pay
  • That the general condition is acceptable for the purposes of providing the loan.

The lender will arrange for an approved surveyor (of their choice) to carry out a ‘valuation report’ at your expense (usually).  The loan will be conditional on this report.  To check that the property is in sound condition you may wish to get a more comprehensive report.  The same surveyor can usually do this at additional cost.

 

TIP     It is usually cheaper to have both reports done at the same time

 

The lender will usually send you a copy of the valuation report and assuming it is all ok the mortgage will be confirmed, the terms of which will be sent as a ‘mortgage offer’ both to you and your legal representative. 

 

The Sales Process

 

A simple step by step guide
  • Get your property valued.  If you are thinking of selling, Lucas Estate Agents will carry this out for FREE.

Most of our market valuations are carried out by directors Keith Lucas and Richard Slater (find out more by clicking the 'about us' button on the left).

 

  • Agree a suitable asking price and get Lucas Estate Agents to measure up and take photos.
  • We will ask you to sign an agency agreement having given you a clear explanation of our terms of business, the type of agency agreement and any other details that you will find helpful to know.
  • Lucas Estate Agents arrange marketing as agreed with you; in a manner that will meet your objectives.
  • We can advise if your property will need a Home Information Pack and if a HIP is needed Lucas Estate Agents can arrange this for you, the terms of providing the HIP will be discussed beforehand.

Lucas Estate Agents signs are a powerful 24 hours a day selling tool.  Well known, easy to identify and telling prospective buyers where to call and how to access our web site where there are full particulars of your property.  If you do not want a board we will respect your wishes.

 

TIP     Instruct a legal representative to act on your behalf now in readiness for when a buyer is found.  This can save delays later on.  Some small up front costs may be required prior to preparing a contract.  Lucas Estate Agents will organise a free no obligation conveyancing quotation from a respected local property lawyer

 

·        Let us know if you would like viewers to be accompanied (unless otherwise agreed by you)

·        Viewings are made by appointment with you

·        If you entrust your keys with us we will always accompany prospective buyers

·        All offers received by Lucas Estate Agents are reported for your consideration

·        Lucas Estate Agents trained negotiators, negotiate the best price for you

·        You agree the sale

·        Lucas Estate Agents notify all parties (the seller, the buyer and both legal representatives) of the agreed terms

·        Confirm to your legal representative to issue draft contracts.

You will need to pay some costs now.

·        Answer enquiries (sellers enquiries) about your property for the buyers legal representative.

·        Lucas Estate Agents and your legal representative work together to progress that sale and make sure all parties are doing what needs to be done in order to meet your objectives.

 

TIP     If you have a holiday booked, let your legal representative and the agents know well in advance.

 

·        Your legal representative will contact you to arrange for you to sign your part of the contract and confirm a completion date.

·        Contracts are exchanged.  You are now legally committed to selling and moving out on completion day.

 

ADVICE

Do not book removals before contracts have been exchanged

 

  • Finalise removal preparations.

 

TIP     Free change of address service at www.ihavemoved.com

 

·        Completion day.  You move out.  Remember to make arrangements in advance to hand over the key (your legal representative will tell you on completion day when you or the agents holding the keys can release them).  Arrange meter readings.

 

Don’t worry about what is involved in selling.  Lucas Estate Agents are with you every step of the way.  You can rely on our experience to guide you.

 

Selling will involve
  • Property Lawyers costs (sometimes called a conveyancer, solicitor or legal representative)
  • A payment to your lender for release of the deeds so that a contract can be prepared by your conveyancer.
  • There may be some other relatively small costs such as bank charges.  Check if there is an early redemption penalty on your existing mortgage and/or any final administration costs charged by your current lender.

TIP  If you own a leasehold property make sure that you keep copies of information from the Managing Agents including clear ground rent receipts and service charge accounts and any other communications about the management of the building in which you have an interest.  Getting copies of this information from Landlords/Managing Agents can be expensive (they know that you will have to pay as you will need it) and is one the biggest causes of delays to a sale proceeding.  The buyers legal representative will want to see at least the last 3 years accounts and associated paperwork.

 

Buying will involve

 

  • Conveyancers costs.  Note:  Conveyancers costs will be slightly higher for the purchase of a leasehold property as this involves quite a lot more work.
  • If the purchase is over £125,000; Stamp duty (unless the property is an area designated with a higher threshold)
  • Land registry fee
  • Local search
  • Any other searches deemed necessary.
  • There may be other relatively small items to be included in your quotation.

Nb.  All of the above costs, except the conveyancing (and any additional costs e.g. some conveyancers charge extra for additional letters, some conveyancers will offer a fixed price for the job) charge are fixed, no matter who you use.

 

STAMP DUTY(as at September 2007 the following thresholds apply to most areas, although some areas of the UK do benefit from different thresholds if they enjoy 'disadvantaged area' relief or similar status).

 

Over £125,000 but under £250,000                 1%

 

Over £250,000 but under £500,000                 3%

 

Over £500,000                                                  4%

 

The tax is paid at the highest rate applicable on the whole purchase price

 

MAY BE SUBJECT TO CHANGE

 

Helpful tips for sellers

 

  • Instruct your legal representative (conveyancer) to start all of the preparatory work in good time as failure to do so, can cause the potential delays at critical points of the sales process.  Your legal representative will charge for this.  But, if you are definitely selling come what may, these are costs that you will face anyway.
  • Search out any certificates for work done to the property.  This includes copies of any planning permission, building regulations approval certificates and copies of any receipts for work carried out to the property.  In particular, if you have replaced any windows since April 1st 2002 then it is absolutely essential that you have either a building regulations certificate from the Local Authority or else a certificate from the window installer who is FENSA registered.  If you have carried out any alterations that should have had building control approval or planning permission and you did not bother to get this at the time we suggest that you get retrospective approvals now rather than wait until a sale has been agreed.  Any major electrical wiring since January 2005 may require Building Control Approval, often referred to as Part P (of the Building Regulations) which, if you used an electrician who was part P qualified should have issued you with an appropriate certificate instead.
  • If it will be a while before you go up for sale and you haven’t had a radon test, why not get one done now?  It usually takes 6 months.  Contact: www.hpa.org.uk/radiation

Let the agents do the work that you are paying them to do.  Generally speaking, the less contact that you have with the buyer the easier it will be for you if things get difficult later on.

 

 

Estate Agency Agreements

 

Often referred to as terms and conditions.  When you instruct an Estate Agent to sell a property they will usually require that you sign a contract acknowledging your agreement to their terms and conditions.  At the very least, by law (The Estate Agents Act 1979) they must let you have a copy of their terms and conditions before they put your property on the market.

 

The terms and conditions, amongst other things,  must specify the type of agency, how much their services are going to cost you, how the fee is calculated along with when it becomes payable.

 

No Sale - No Fee

 

  • This means that if the property is not sold, no charges are payable to the agent.  Check with the agent exactly what this means.  At Lucas Estate Agents, unless agreed otherwise in advance and in writing, it means that unless the sale goes through, no fee of any kind is payable, no matter what the circumstances.
  • With the introduction of Home Information Packs, which cost several hundred pounds, this may affect the precise meaning of what No Sale No Fee means.  At the time that this guide was updated, September 1st 2007, it was very early days and most firms are still 'feeling' their way with clients over the cost of Packs, how and when they are paid for.  Contact your local office for latest information.

 

Sole Agency or Multi Agency

 

  • Sole Agency - Granting a sole agency can often be the way to get the best fee.  You are tied to your choice of sole agent for a particular period of time, which is variable and often negotiable.  If, during the period of your sole agency, you were to sell through another estate agent then you most probably would have to pay two fees.
  • Multi Agency - The fee is more expensive, but you only pay the agent that sells your property.  You can have as many estate agents as you want selling your property and the one who makes the sale gets the fee.

Other Types of Agency Agreement:   The two most relevant in our area are:

 

  • Joint Sole Agency - This is the same principle as sole agency described above but in this case two (usually) estate agents who are prepared to work with each other for an exclusive period agree to market the property and the fee (usually more than just sole, but quite a bit less than multi) is shared between the two agents regardless of who sells (it is up to the agents to agree how they will share the fee if the property is sold by them).
  • Sole Selling Rights - This is not very common in Northamptonshire.  If you grant an estate agent sole selling rights this is for an agreed period of time.  You will pay the agent their agreed fee, no matter who sells the property; even if you sell your property to your best friend without the agent being involved.

 

ADVICE  Do not sign anything that you have not read or do not fully understand.  It is not unreasonable to ask for an explanation of anything that you are not sure of.  Be very wary of being 'pushed' to sign on the dotted line there and then.

 

Some Common Questions:

 

Q: Must I have a For Sale Board?

A: No - It is your choice.

 

Q: Does my property have to go in the newspaper?

A: No - We can sell without advertising in the paper, and frequently do so.

 

Q: When will buyers want to view?

A: We try and make sure that it is at a time convenient for you.

 

Q: I work all day and do not want evening viewings.

A: You can trust us with your keys and we will bring buyers round when you are out.

 

Q: I don't want to meet viewers.

A: No problem, just let us in, go for a walk or shopping and we will secure the door when we have finished demonstrating your home to the prospective buyer.

 

Q: Should I sell first or find first?

A: If you need to sell your property in order to buy it is usually best to get your property onto the market first.  We can offer your property for sale 'subject to you finding a suitable property to buy'.

 

Q: How long is a sole agency for?

A: It can vary, 12 to 16 weeks is fairly typical.

 

Q: What happens if my property doesn't sell?

A: We will review the current marketing arrangements with you together with any feedback from prospective buyers and devise a fresh marketing plan.

 

Q: What happens after a viewing takes place?

A: We give you feedback from the viewing and keep a record so that the information gathered from prospective buyers can be used to shape future marketing advice.

 

Q: Will it cost more if the sale arranged falls through and my property needs to be re-sold?

A: No!  The only additional costs that you may incur are with your legal representative who will probably charge you for the initial contract work if it has to be aborted.

 

Q: What happens at the end of the sole agency period?

A: At the end of the sole agency period you will need to give written notice and this can usually only be served at the end of the sole agency period.  Most agents stipulate 14 days notice which we think is unreasonable and hence at Lucas Estate Agents we normally only require 7 days notice.  Most agents contracts are what are known as 'rolling' contracts; in other words although you will have signed up for a 'period' of sole agency the sole agency will 'run' until terminated by you the seller.

 

Q: Can I take my property off the market during the sole agency period.

A: Yes.  But, if you instruct another agent during the sole agency period and your property sells within this time frame then you will be liable to pay two fees.

 

Q: How often will my property be advertised?

A: All the time on multiple web sites over the internet which is by far the best means of advertising these days.  Newspaper advertising is still important and this will discussed at the time of valuation when we assess your timescale and objectives.

 

Q: How much is the fee?

A: Depends on whether of not it sole or multi agency.  Also what the property is, the likely demand, amount of advertising, service levels required and the location of the property.  Lucas Estate Agents will provide a competitive quote after carrying out a free market appraisal including recommended asking price.

 

Q: If my property sells quickly will I have to pay the full fee?

A: Yes.  The convenience of a quick sale should not be overlooked.  The purchaser who buys quickly may have been serviced for a long time by the agent and as a result have the confidence to view and make the buying decision swiftly.  There is a lot of work to do after the sale has been agreed and in any event if the buyer were to back out for whatever reason we would resell the property without extra cost.  If it takes longer to sell we don't increase the fee no matter how much work is involved.

 

Q: How is the asking price set?

A: Usually a combination of what you want/need combined with our advice about what is realistic for your type of property and location as well as current demand and our in depth knowledge of the local property market.

 

Q: How quickly will my property go on the market?

A: Usually the same day that we come out to see you.  The legal requirement for a Home Information Pack (HIP) may well change this, so please ask for the latest position in this respect when we come to meet you.

 

Q: What is this HIP thing?

A: A Home Information Pack is a set of documents that includes evidence of ownership of the land/property, details of the lease/service charges if applicable, local search and water board search, sale statement and a Domestic Energy Assessment.

 

 

The information within this article is provided in good faith and whilst believed to be correct Lucas Estate Agents Ltd do not take responsibility for any errors or omissions.  This information is for general guidance only.   Copyright May 2007.

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