BUYING PROPERTY – the four stages

The four stages of Buying Property1. Pre- Contract

In most cases contracts are not legally binding until they have been signed by both buyer and seller. Contracts and copy title documents are sent by the sellers solicitor together with maps, planning permissions etc. If you are getting a loan you need a written letter of offer from a lender before signing contracts. Your solicitor’s job is to make sure that the title to the property is in order and to raise any queries. This will ensure that you and your lender get a good title.

Waiting for the letter of offer to issue, and waiting for satisfactory replies to pre- contract enquiries can sometimes take a few weeks. Your solicitor will keep you regularly updated on progress so you will know what is happening at all times.

2. Post contract

Once your solicitor is satisfied with the title documents you will be asked to sign the contracts and pay a deposit of around 10% (less any booking deposit paid). You will usually sign loan documents at this stage as well. The closing date is usually four weeks from the seller signing the contracts although in newly built houses this depends on how close the house is to being finished.

There are documents that most lenders will require from you such as a life policy, fire insurance policy and a direct debit mandate. However there may also be individual requirements depending on your circumstances. If you are getting any help to buy the property from a family member they may be asked to sign a deed giving the bank priority on the title. You will be advised on the loan conditions. Delays that occur at this stage usually involve satisfying the lender that all the paperwork is in order. Once the loan cheque issues and all the documents are ready the sale is ready to close.

3. Closing

Your solicitor will notify you of the closing date in good time to let you snag the property (if newly built) and make all the necessary arrangements to move. You will be asked for the balance of the purchase monies at this stage. The loan cheque should issue in time for the closing. It is important that the loan money does not issue too soon before closing as interest starts to accrue in most cases once the cheque issues.

‘Closing the Sale’ involves the handover by the buyer’s solicitor of the purchase monies in return for the title documents. Keys will also be handed over or arrangements will be made with the auctioneer. The purchasers solicitor will make searches to ensure the seller is not a bankrupt, and that there are no judgements registered against either the seller or the property. These will be presented to the seller’s solicitor who will explain any acts and will provide undertakings to pay off any existing loans from the proceeds of sale.

4. Post closing

Once the purchase monies have been handed over and you have moved into the property the solicitor’s job is not over. The transfer deed and other documents must be signed by the purchaser and stamped by the Revenue Commissioners before the documents, maps and mortgages are registered in the Land Registry. At the moment there are backlogs in registration, which will take some time to clear. The application is assigned a dealing number, which can be quoted as evidence of title if necessary.

Once the title is registered the lender is sent the documents, with a certificate that the title is good and marketable. You will be sent a copy of the title to show you are registered.