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The Legal Process of Buying a Property
After your offer has been
accepted, your agent or solicitor should now keep you informed of the
progress of the transaction and protect your interests at every stage,
but here is a brief outline of the legal steps which will now follow:
Letter of Offer: The seller will sign the letter of offer
previously signed by you and accept your Earnest Deposit (this is typically 2%
or 3% of the property price and can also be kept by the estate agent
as stakeholder until the Sale and Purchase Agreement (SPA) has been
signed).
The letter of offer gives a
timeframe for the transaction including when the SPA should be agreed
and signed (usually about 14 working days after the letter of offer
has been signed); your lawyer should check the seller’s title before
you sign the letter of offer to ensure he/she is the actual owner of
the property.
Sale and Purchase Agreement (SPA): The SPA will give the
details for the transfer and specify any warranties; you should now
give the seller a balance deposit of 10% of the purchase price less
the amount of deposited at the letter of offer stage.
State Authority Consent: This only applies to transfers of
leasehold property or if a foreign buyer is involved and it can take
from 6 weeks to 3 months.
Completion: Completion will usually take place within 3 months
of the SPA (or state authority consent if applicable) but may be
faster if you are a cash buyer or the seller does not have any
existing loan secured on the property. You now pay the balance 90% of
the purchase price to the seller and you finally get the keys to your
new home! |
