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THE LEGAL SIDE OF BUYING OR SELLING A HOUSE

Buying a House

Buying a House

WHAT IS CONVEYANCING?

  • Conveyancing is the legal process involved in buying, selling, leasing, mortgaging or re-mortgaging a property.
  • It involves transactions with Auctioneers, Builders, Banks and Insurance Companies, and there are important legal steps to take along the way.
  • Most purchasers choose to instruct a conveyancing solicitor to carry out the conveyancing process for them. Conveyancing Solicitors specialise in property transactions and thus are experts in their field.   It is impossible to buy or sell a property in Ireland without a Solicitor.
  • If you are purchasing or selling a property, it is important to know the steps involved in a conveyancing transaction, budget for your costs and outlay including stamp duty and registration fees.
  • The following is a simple guide to the steps involved….

STEP 1: The Purchaser agrees to purchase the house.

  • The Purchaser agrees the price with the auctioneer and pays a booking deposit which is usually refundable in the event of the purchaser deciding not to proceed with the transaction prior to signing contracts for the sale.
  • The Purchaser gives his/her details to the Auctioneer. The Auctioneer sends out a copy of the sales advice note to the Solicitors for both parties, setting out the terms that have been agreed i.e. price, deposit, closing date, list of contents included in the purchase price etc.
  • All documents are marked Subject to Contract/ Contract Denied. This makes it clear that there are no binding contacts yet, usually until contracts have been executed as well as exchanged by both parties in addition to a full deposit having been paid.

STEP 2: The Vendor’s Solicitor issues contracts for sale to the Purchaser’s Solicitor

  • The Purchaser’s Solicitor reads the Contract and Title Documents to ascertain that title is good and marketable.

STEP 3: The Purchaser’s Solicitor arranges for the Purchaser to sign contracts

  • If the title is in order and conditions of the sale have been agreed between Purchaser and Vendor’s Solicitors, the Contracts for Sale are signed by the Purchaser in the presence of their Solicitor.
  • The Purchaser must provide the necessary funds for the balance deposit monies due.
  • The Purchaser signs mortgage documentation.

STEP 4: The Purchaser’s Solicitor returns the Contracts for Sale

  • The Purchaser’s Solicitor returns contracts, along with a cheque or bank draft for the balance deposit monies due.

STEP 5: The Vendor signs the contract

  • The Vendor signs the Contracts for Sale, usually at his/her Solicitor’s office. The Vendor’s solicitor returns one part of the contract to the Purchasers Solicitor.
  • NB: Only now is it a binding contract.

STEP 6: Purchaser’s Solicitor’s tasks

  • The Purchaser’s Solicitor sends questions about the title of the property called Requisitions on Title, a draft purchase Deed (Deed of Transfer) and a note of the closing requirements to the Vendor’s Solicitors.
  • The Purchaser’s Solicitor will arrange for searches to be carried out by his law agents searching for other transactions regarding the property in sale to be carried out for the anticipated closing date.

STEP 7: The Purchaser’s Solicitor requests their client’s loan cheque

  • If the Purchaser is borrowing money to buy the house, his/her solicitor will normally request the Loan Cheque about two weeks before the closing date for the sale.
  • It takes about one week for the cheque/ funds to issue provided all formalities are in order, and it can take up to 5 days or a further week to clear in the Solicitor’s client account.

STEP 8: Closing the sale

  • Closing the sale is where the purchaser acquires title/ ownership of the property and as a result becomes owner of the property.
  • It is essentially a swapping exercise: money is swapped for documents and keys.
  • Once the Vendor’s Solicitor has received the Balance Purchase Monies, and the Purchaser’s Solicitor is happy that the documents are in order and searches received are clear and certified by the Vendor’s Solicitor, the sale is completed and the Purchaser can take possession.

STEP 9: The Purchaser’s Solicitor attends to stamping and registration

  • For stamp duty purposes the Purchaser’s Solicitor must attend to stamping of the Transfer Deed by the Revenue Commissioners.
  • Once the Transfer Deed is returned, the deed is submitted for registration in the Property Registration Authority.
  • Once registration of the deed is complete, the Purchaser is now the registered owner.

STEP 10: The Purchaser’s Solicitor completes registration and sends title documents to the Purchaser’s lending institution

  • Once registration is complete, the Purchaser’s Solicitor sends the Tile Deeds to the lending institution which provided the mortgage for the house purchase.
  • If the property is mortgage free, the deeds are available for collection at the solicitor’s office or the solicitor can retain them in their fireproof cabinet for safekeeping.

Conveyancing is a specialist area and our Fergal McNamara is one of the most experienced Conveyancing Solicitors around.

I hope this article has been helpful.  If you have any queries regarding buying or selling a house please contact us by phone at 061 501100, Fergal McNamara by email: fmcnamara@hdm.ie or get a call back by completing our contact form so we can provide you with further information or advice.