The legal process for buying a second hand house/apartment is different to the legal process involved in buying a new build house/apartment (see next topic). It is all about the money and you don’t know what you can buy until you know what you have to spend.
A good starting point is the conversation with the Bank to find out what amount of money can be borrowed (limits are regulated by the Central Bank). Once the spending figure has been ascertained a budget should be drawn up to include the various costs that will be incurred including stamp duty, legal costs, survey costs, valuation fee and registration fees. For many first time buyers financial assistance from family can be important to help get on the property ladder. Once the budget has been drawn up the next stage is to find the right home which is often about location, location, location. It is important to bear in mind that the right house might not be immediately available and patience may be required.
When you do find the right house the next challenge is to negotiate the price with the estate agent who will have the advantage in terms of experience. Face to face discussions tend to work better than telephone or e-mail. Once you get to ‘sale agreed’ the legal stage of the process begins. The sellers solicitor will send contracts and a copy of the title to your solicitor who will raise pre-contract enquiries and make sure that the title to the property is in order and will also deal with the requirements of your lender which will be detailed in the formal Letter of Loan Offer and Solicitors Pack sent by your lender directly to your solicitor. If you are depending on a mortgage to fund the purchase of your house you should insist on a loan clause in the contract ie. that the contract is conditional on you getting your money from your lender.
The legal process takes longer than you might expect and in general from the time that your solicitor gets the contract and copy title to the time you get the keys it will take 4/12 weeks and longer if there are problems. It is important that you have the property surveyed for defects by a qualified and experienced engineer/architect/surveyor. It often worth checking with the local authority for development plans for the area in which you plan to buy. When your solicitor is satisfied that the title is in order he/she will meet with you and get you to sign the contract and the documents for the Bank. You will need to pay over the balance of the required 10% deposit (less the amount of booking deposit already paid to the estate agent). The contract will set out a closing date when monies are exchanged for the keys. It is important that you comply with the bank’s mortgage requirements including obtaining a mortgage protection policy, house insurance policy, completing direct debit mandate and other bank documentation. The purchase does not always complete on time sometimes the closing date can be delayed. If there are delays then the party causing the delay may be charged penalty interest or face legal proceedings. It is always a good idea to change the locks when you get the keys, and take meter readings. Subsequent to the closing your solicitor will then stamp and register the title and furnish your title documents to your lender which will be a requirement of your mortgage.
