Property Terms
Explained
Coal Search
Will discover whether the property has been or might be affected by subsidence in the future. It will also show whether there are any records of old shafts within the boundaries of the property.
Completion Date
The date when keys are released and ownership of the property passes from the seller to the buyer.
Contract
This is the document that sets out the names of the parties to the agreement, a description of the property and details the agreed price of the property. Both parties will sign a copy of the contract and the parties solicitors will then exchange the contracts. It is only when the contracts have been exchanged that there is a legally binding contract.
Enquiries Before Contract
These are questions raised by the Purchasers’ Solicitor in regard to the property and are answered by the Vendors.
Environmental Search
This is carried out to check if there are any known environmental issues affecting the property, these include matters such as landfill or waste disposal sites in the area, if the property has been built on an old industrial site and whether there are any risks from contaminated land, toxic emissions, flooding, subsidence etc.
Exchange Contracts
From the time contracts are exchanged, the contract becomes binding. Until contracts are exchanged nothing is binding - either party can walk away from the transaction without penalty.
Fixtures, Fittings and Contents Form
A list of the items at the property which are either included or excluded from the agreed price. The form is completed at an early stage by the seller and sent to the buyer, so that both parties understand what is included in the selling price.
Freehold
Ownership of both the property and the land it stands on.
HIPS – Home Information Packs
This contains basic information about the property being sold and includes an Energy Efficiency report on the property. If you are a seller you must have this before you can market the property.
Land Registry
A Central body that holds records of who owns the land, and under what conditions.
This was set up in 1925, to simplify the conveyancing process. Not all land in England and Wales is registered today. This is partly due to the fact that land can only be registered following certain "triggering events". The Land Registry has their own website which provides useful information.
Land Charges Search
This will tell us whether any party to the transaction is bankrupt in which case they will normally not have the authority to enter into any contract without permission from their receiver. This search may also reveal other matters if the title is not registered at the land registry (un-registered land).
Land Registry Search
This search will determine whether any adverse entries have been placed on the title registered at the Land Registry in the sellers name between disclosure of the title prior to the exchange of contracts and completion. If there are you will want to have them removed or otherwise dealt with so they do not affect you.
Leasehold
Ownership of the property but not the land on which it stands. When the lease expires ownership of the property reverts back to the freeholder.
Local Authority Search
This is undertaken to discover whether there are any Local Authority projects which might adversely affect the property you have agreed to buy for example, road building projects or local planning issues. The search is only made against the property therefore it is sometimes necessary to search against other properties or to look at the Local Authority plans for an area as a whole.
Mortgage
A loan to finance the house purchase. The mortgage is 'attached' to the title deeds, and means that the property cannot be sold without paying it off at the same time.
Contracts should not be exchanged until an acceptable written mortgage offer has been received. Verbal confirmation from a bank or building society that they will grant a mortgage is not enough.
If you are selling, we will contact the mortgage lender at an early stage to ask how much it will cost to pay off the mortgage. You may find that you will be charged a financial penalty if you pay the mortgage off early. This is a consideration to be taken into account when agreeing a completion date, and often applies when an existing mortgage was set up on a fixed rate.
Mortgage Deed
The legal charge of the property to the mortgage lender until such time as the loan is repaid.
Property Information Form
This is a questionnaire about the property completed by the sellers. It covers such items as guarantees, neighbour disputes and boundaries.
Redemption Statement
A statement from your mortgage lender stating how much you owe on your mortgage.
Redemption Fee
Penalty sometimes incurred if paying off a mortgage early.
Searches Pack
This specially negotiated search pack includes Local Authority, Water/Drainage and Environmental searches, all for one fixed fee.
Survey
A report carried out by a surveyor on the condition of the property.
A property is "sold as seen". It is for the buyer to discover any physical defects by means of inspections and surveys.
Most houses are bought with the assistance of a mortgage and the bank or building society, will require a mortgage valuation. However, this is not a survey - it merely ensures that the property is of sufficient value to protect the lender's interest.
Registration of Title
The process whereby a persons name is entered on the title to the property at the Land Registry following a change of ownership. There are similar processes when other changes in details have to be recorded, for example following a re-mortgage to a different lender of money on the property.
