Buying a Property
Establish your budget
The most important step in buying a new home is knowing how much you have to spend. Avoid the temptation to spend more because “it just feels right”. Instead, do your homework and make common sense decisions based on access to transport or the appeal to a rental market. Work within a realistic budget. There are too many costs beyond your control (such as rising interest rates) so limit yourself where you can.
- How much can or should you borrow?
Shop around. The smallest difference can be significant in the long run.
- Are there other hidden costs, such as valuer’s fees or architects survey fees?
Take the time to understand all the costs involved at the beginning so there are no surprises.
- Remember, 10% of the purchase price is payable on signing contracts.
This is a mandatory cost that must be paid to secure the purchase.
- Request a written estimate from your solicitor
Your solicitor should know at the outset how much the legal costs and expenses are likely to be.
- Allow for a service charge for an apartment or mixed development.
This fee is annual with the first payment due on closing.
- If you are selling a property, put it on the market as soon as possible as you must secure a buyerbefore contracts can be signed.
Find the property
Familiarise yourself with the property market in the area you have in mind and prioritise your requirements so that your search is focussed.
- New builds require a booking deposit, usually about 2%, payable to an auctioneer.
- Buying a second hand house involves putting forward a bid to an auctioneer.
Be prepared to compete with other prospective purchasers and know when to withdraw from a bidding scenario. If your offer is accepted, a booking deposit is payable to the auctioneer.
- If the property is being sold at auction, your solicitor should check out the title beforehand and you must have 10% of the price available at the auction (as deposit) if you’re successful. If you’re serious about a property that’s being auctioned, have it surveyed first. Contracts are exchanged on the auction day, meaning you’re legally bound to purchase the property.
In all cases, give the auctioneer your solicitor’s details.
Your solicitor receives contracts and copy title. They will complete a full investigation into the title to the property, including planning and services.
You normally have between 14 – 21 days to return signed contracts to the seller’s solicitor. Before signing contracts, you should:
- Formalise your mortgage by receiving a suitable loan offer with conditions you can meet.
- Arrange the 10% contract deposit.
- If it’s a second hand property, arrange for an architect or engineer to do a structural survey and check that the boundary of the property matches the map or description with the title.
Meet with your solicitor to sign contracts
Your solicitor will take you through the contracts and loan offer so you can complete all necessary documentation.
- Now you’re required to furnish the balance of 10% contract deposit.
- Contracts will be returned duly signed with the deposit to the seller’s solicitor.
- The contract is not binding until signed by the seller and returned to your solicitor.
For a second hand property, a closing date is inserted in the contract or agreed with the vendor on returning contracts.
For a new property, the builder’s solicitors will issue a completion notice. This normally allows 14 days to complete the purchase so it’s important to be aware of the progress of construction during this time.
- You should provide the builder with a snag list i.e a list of unfinished works within 7 days of receiving the completion notice.
- Your solicitor will requisition the loan cheque from your bank. Check that all items are with your bank so that the cheque can issue without delay, making sure your insurance is in place and that the final valuation has been carried out by the Bank’s valuer.
- Your solicitor will issue you with a statement of monies due on closing.
- The purchase can close once your loan cheque issues and you’ve paid the balance. Closing will take place at the seller’s solicitor’s office or by post and finally you get your keys or in most cases a letter authorising you to collect your keys.
Attend with your solicitor to sign your deed
Your solicitor will then proceed to stamp your deed in the Revenue Commissioners and lodge an application for registration in the Land Registry or the Registry of Deeds. Registration can take months, if not years, depending on the county and type of property involved. However, this does not affect the ownership of your property.
Once registration is complete, you will be the registered owner of the property and your title deeds along with the solicitor’s certificate of Good Marketable Title can be returned to the bank.