The costs of conveyancing
When it comes to buying a property, it’s not just the mortgage you need to worry about. The following costs usually need to be paid before you can think “home, sweet home!”
Mortgage costs and fees
Once you’ve had your offer accepted, and if you are buying with a mortgage, there will be a number of fees that you may need to pay in order to progress with your application.
Conveyancing and legal costs
You will need to instruct a solicitor or registered conveyancer to do the legal work for you and their fee will depend on the type of property that you are buying (either leasehold or freehold) and the property price. They generally offer a fixed fee or a fee based on a percentage of the property price.
You should expect that when you ask the solicitor to do the work for you, you will need to give them some money ‘to hold on account ‘ to cover the initial costs. The balance of the fees will need to be paid before the property purchase completes. They will send you ‘completion statement’ which will show all the costs that have been incurred along with a total amount that you will need to pay before the property is yours.
The solicitors will also have to pay for information and checks for which you will need to cover the costs, these are generally known as disbursements. These includes ‘searches which will be required by your lender as they may affect the potential future value of the property. All of the searches normally cost £150 -£250.
The local council will provide a report which shows information such as any planned development work or existing disputes that affect the property you want to buy and who is responsible for maintaining roads and pathways around the property. The costs vary by Local Authority but expect to pay upwards of £150.
These will check that the person who is selling you the property is the legitimate owner of the property and is able to it to you. They will get a copy of the title register and title plan that is held at the Land Registry.
An environmental search is important as it will establish whether the property you are buying is built on or near contaminated land or water, or an old landfill site, it should also show whether there is a risk of flooding.
A water authority search will show where your water comes from, where it drains to and whether there are any public drains on the property.
In some areas, such as those where mining takes place or used to take place, you will need a specific search to check if there is anything that affects the property.
This dates from the middle ages when property owners used to pay to maintain the Parish churches and in some cases this liability may continue. Solicitors will normally recommend an indemnity policy (normally costing about £20) to cover against any potential liability.
Surveys and reports
As well as checking all of the paperwork, it is always recommended that you have a survey of the property undertaken. This will give you independent professional advice as to its condition, and highlight any potential issues or concerns. It is always recommended to use a Royal Institute of Chartered Surveyors (RICS) member to do the report for you. The cost will vary substantially depending on the type of survey, the location, condition and size of the property.
There are three main types of survey inspection which increase in detail.
- Home Condition Report
- Home Buyer Report
- Full Building Survey