BUYING A HOUSE

 Conveyancing Landlord and Tenants Lawyer Cork  Kerry
 

In law, conveyancing is the transfer of the legal title of real property from one person to another, or the granting of an encumbrance such as a mortgage or a lien. A typical conveyancing transaction has two major phases: the exchange of contracts and the completion.

This may seem obvious, but the first thing that must be done is to choose the property you wish to buy. You should ask a few questions about the property, such as ‘Is it for sale?’ If it is not for sale, there is no point in buying it.

Secondly, is it within your price range? We would all like to live in a three-story house with eight bedrooms, but, we have to be realistic and know what we can afford or what our bank manager/lending institution will be willing to lend us.

Thirdly is the house a good investment? It would help if you looked at things such as the area where the house is situated, its proximity to major towns/cities, and whether it is near a motorway orin the line of a planned highway.

Although the most property is bought and sold privately in today’s climate, the property is also sold by way of public auction. Approaching an auction can be a daunting task for a proposed purchaser. In this situation, it is normal for you to instruct a solicitor to make the necessary precautionary enquiries. He will also attend the auction with you. It is also essential to have the property surveyed before the auction.

Also, before the auction, the title will have to be investigated (see Step 4), and the financial arrangements will have to be in place before the auction begins. When the auctioneer says ‘SOLD’, you are committed to the purchase if your bid has been successful. This means that you must pay a deposit immediately, and the balance is due within the month.

‘Title’ about property means not only the documents that show that you own the property, but it also guarantees that no one else can come along and say that they own the property. There are two types of title in Ireland: Land Registry title (Registered) and Registry of Deeds title (Unregistered).

The owner of the property that is registered in the Land Registry will have a numbered folio. Property owner This document records the name and address of the owner, a description of the property and a map of the property known as the file plan. A folio is conclusive evidence of the person’s ownership of the property. When Land Registry property is being sold, the folio must be produced to sell.

The registry of Deeds title is that which is registered with the Registry of Deeds. This occurs where the title has built up over several years. These documents would include Deeds of Conveyance used to transfer freehold-unregistered land or Deeds of Assignment used to transfer unregistered leasehold land.

On completion of a sale of unregistered property, the purchase deed is lodged with the registry of the deeds,s where the registration details and the registration time are noted on the Deed. The main reason for registering an act in the Registry of seeds is that the time of Registration governs conflicts between two different deeds, e.g. if two mortgages on one property are lodged on one day, the one registered first will have priority.

In this country, the land is either freehold or leasehold. Freehold interest in the property is the highest interest that an individual can hold, and in general, such an owner is free to do as he wishes with the property.

A leasehold interest is less than a freehold interest because it is for a term of years and will end at some date in the future. The owner of the freehold owner is granting a lease between landlord and tenant and is governed by d of time. It creates a relationship between landlord and tenant and is governed by Deasy’s Act 1860.

Significant changes in the law have been related to the private rented residential sector, which is now governed by the Residential Tenancies Act 2004.

Before choosing a property, the purchaser must make sure he either has the necessary money for the purchaser or otherwise has secured a mortgage for the value of the proposed purchase.

The market for home lending is very competitive between the banks and the various lending institutions.

It is essential for a person considering purchasing a house to consideevaluatenancial the commitment involved. The lending institution should be approached as early as possible.

They will give you an idea of the amount they are willing to lend you. You will then know how much you can spend, the type of house, and the area you will be looking in. the lending institution will require you to fill out an application form and give them specific specifications regarding your income.

When a borrower and a lender enter into a mortgage transaction, the lender takes a legal charge over the property. This is the loan security in the event the borrower fails to repay the mortgage.

The sale and purchase of land and houses are governed by Section 2 of the Statute of Frauds (Ireland) Act, 1695.

The general rule according to this statute is that all contracts for land sale must be in writing. However, this definition is not strictly true as what the Act requires is that any agreement to sell land be evidenced in writing. The Act requires

At a minimum, the re is necessary to be written evidence concerning the parties, the property and the price paid. In practice, most conveyances use the Law Society’s standard form of particulars and conditions of sale.

This contract deals with the following matters:

a) Makes provision for the consent of a non-owning spouse under the Family Home Protection Act 1976. Under this Act, a spouse cannot sell any property, a family home, without the consent of the other non-owning spouse. This must be a prior consent and must be endorsed on the contract before it is signed by the spouse who is the property owner.

b) Makes provision for the names and addresses of the parties.

c) Sets out the purchase price and the deposit.

d) Sets out the closing date. This is the date on which the parties to the contract agree the deal should be finalised, the purchase money paid over and the deeds and the keys to the property handed across.

e) The contract will also list the various documents shown before the contract is signed. A purchaser who signs the contract without inspecting all the documents made available to him is deemed to have full notice of them and is caught by the consequences of any demanding conditions that may appear on them.

f) The contract then continues with several standard conditions. The most significant of these contains the procedure to be followed when a property is bought and sold at auction, several warranties and, in particular, a warranty that any land development since 1 October 1964 has full complete and proper planning permission

These are enquiries that a purchaser should make in the course of purchasing property .during the purchase, There are some, which should be made before the contract is executed, and some which are made on the date of closing the transaction.

The pre-contractual ones are as follows:

(a) Planning search: This can be made in the planning office. This will let the purchaser know how the property is zoned, be it residential, commercial or otherwise; whether there any proposals for road widening in the area; and whether or not any applications for planning permission in respect of the property have been granted or indeed rejected.

(b) A Licensing Search: this will arise when the property is a pub or a hotel. It will establish the nature of the licence and the extent to which the premises are licensed.

(c) A Compulsory Purchase Order Search: This can be made with the local authority. If a CPO has been made, the vendor can no longer give a good title as the title vests in him.

The following searches are done on the day of closing:

(a) A Land Registry search: This is a search in the land Registry to inspect the register or folio to find the date date-to-date position up-to-date. Such a search will establish the ownership of the property, the title, whether absolute or possessory, whether it is leasehold or freehold, and whether or not there are mortgages, rights of residence or other restrictions on the folio.

(b) A Company Search: This is a search made in the Companies Registration Office, which will confirm that the company exists and is still on the register and disclose any charges against it will also reveal the existence of a winding-up order or petition. It is customary on closing to get a certificate from the Company Secretary certifying no resolution has been passed.

(c) A Judgement Search

(d) Bankruptcy Search

(e) Sheriff and Revenue Sheriff Searches

(f) Registry of Deeds Searches

A person buying a house must realise that there are a lot of other hidden costs involved apart from the purchase price of the home.

(a) Stamp Duty
This will apply to all transactions involving the purchase of the property. The duty will depend on the value of the house.

(b) Search Fees
It will vary depending on the title and extent of the enquiries.

(c) Solicitors Fees
It varies from solicitor to solicitor and is competitive at the moment but usually at a base rate of 1500 plus costs outlays or around 1%.

(d) Surveyor’s Fees
Again depends on the details of the work to be done, but a surveyor needs to assess the property's condition.

(e) Registration Fee
These are the costs associated with registering the title with either the Registry of Deeds or the Land Registry.

(f) Insurance
Adequate insurance must be put in place covering the property's structure when the purchase is completed. It is the seller’s responsibility to have the property insured up to the closing date, and then once the deal is completed, it is up to the purchaser to insure the property. The lending institution will also insist that mortgage protection insurance be taken out. This ensures that if the borrower dies, the mortgage protection insurance proceeds will pay off the remainder of the mortgage.

(a) Easements

Land and buildings can involve other people’s rights to or over the property, such as rig, has way, fish, etc. All of these matters will be investigated appropriately before proceeding with the purchase. These are made as part of the Requisitions on Title during the earlier contract stages.

(b) Fixtures and Fittings

Fixtures attached to the land are presumed to be part of the sale unless expressly excluded in the contract.

(c) Family Home Protection Act, 1976
As already laid out above, this Act curtails the right of an owner to sell the family home without the prior consent of their spouse.

(d) Planning Permission

Any house built since 1 October 1964 requires Planning Permission. It is the responsibility of the purchaser’s solicitor to ensure that the necessary planning documents are in order. The purchaser’s solicitor’s responsibility is An architect's certificate, usually required to confirm that a second-hand house was built by the conditions of the planning permission.

You can contact us for a quote using the form below. Because we are a specialist provider, our legal conveyancing fees are often lower than other general law firm practices. We constantly endeavour to respond to each quote request within one working day and will provide a full breakdown of charges including outlay, registry fees and Vat.