What is the role of a help to buy solicitor?
Whenever you buy a home there is a lot of legal work which goes on to ensure the transaction between both parties works out smoothly.
When buying a help to buy property this work is a bit more due to the fact that the help to buy agency is a third party involved in the transaction.
When you get a help to buy property through the help to buy equity loan or help to buy shared ownership scheme you will usually have to get approval from the help to buy agent or landlord before the transaction can occur between you and the help to buy builder.
You will need to get an authority to proceed and then an authority to exchange.
What is the help to buy equity loan?
The help to buy equity loan is a government loan for first-time buyers or home movers which gives then a government loan for up to 40% of their new build property purchase price. It is interest-free for 5 years.
Help to buy solicitor: the process
Due to the fact that the help to buy equity loan and ISA are only eligible for new build properties your help to buy solicitor will cost more as the legal work for new build properties always costs more.
The help to buy solicitor process goes like this:
Once you instruct your help to buy solicitor they will ask you for your identification details, your proof of mortgage deposit funds plus other costs.
They will then let you know the property searches they intend to carry out. At this point your help to buy mortgage broker may have already issued you an agreement in principle and asked for the details of your help to buy equity loan and your help to buy solicitor.
Your help to buy solicitor will help you get the “authority to proceed” document form the help to buy agent. To do this you will need to fill in the help to buy property information form for your help to buy region.
Your help to buy solicitor will then carry out any necessary property searches
Your help to buy solicitor will then submit your authority to proceed to both your help to buy mortgage lender and the help to buy builder or developer.
Your help to buy solicitor will then receive the sale contract from the help to buy developer and raise any issues they see fit.
If everything is alright your help to buy solicitor will then get the “authority to exchange “ letter from the help to buy agent. They will then submit this to the help to buy builder and help to buy mortgage lender.
Your help to buy solicitor will then deal with all the transfer of funds.
Your help to buy solicitor will then agree on a date for the exchange contracts - this is the day where you are made legally bound to buy the leasehold property from the help to buy developer.
You'll have to pay your mortgage deposit and then set your completion date (the day you pick the keys to the property).
Help to buy solicitor fees
Below is an example of the help to buy solicitor costs for a £500,000 help to buy property (which are always leaseholds)
Stamp duty (first-time buyer): £10,000
Conveyancing fee (dealing with help to buy mortgage, help to buy equity loan & ISA claim, bank transfer, title check, property review & check): £1000
Land registration fee( for new builds): £270
Bankruptcy and OS1 priority searches: £10
Online ID fee: £8
Property searches (including the local authority, drainage, environmental, chancel indemnity and title plan): £265
Help to buy ISA redemption fee: £60
Engrossment fee (is the cost levied by the landlord when they issue a new lease (normally only payable on new build purchases): £100 to £200
Notice fee (is the cost levied by the landlord when being notified of a change of ownership of the leasehold and the registration of a charge (mortgage) over the property): £100 to £200