19 January, 2018

Kingfields Solicitors

 

 

Frequently Asked Questions.

The FAQ page is split into 4 sections. Please choose the section relative to you.


Questions relating to New Build "Off Plan" purchase

How long is the legal process?

This will depend on whether the property has been constructed or is in the process of construction. If the property is in the process of construction, then generally the Developer will allow you 21 days to exchange contracts (or any such date agreed at reservation) otherwise the developers reserve the right to forfeit your reservation deposit and market the property.

Once the property has been constructed the developer will serve the Completion Notice upon us requiring you to complete the purchase within the Completion Notice Period (generally 10 working days) agreed in the contract. Please refer to the process for 'New Build' purchase for more details.

If the property is already constructed then you will be expected to complete on a fixed date agreed between you and the developer when you reserve the property.

What is NHBC?

NHBC (the National Housing Building Council) is the standard setting body and leading warranty and insurance provider for new and newly converted homes in the UK.

NHBC or Zurich Municipal offer a 10 year guarantee to 'New Build' properties called 'Buildmark' against major structural problems.

We will ensure that the developer is registered with NHBC/Zurich Municipal and is offering you the construction warranty and insurance policy.

What deposits do I have to pay?

This varies and depends on what terms you have agreed with the developer when reserving the property.

The amount of deposit payable can vary from 5% to 20% of the purchase price.

When do I have to pay the deposit?

You are required to pay the agreed deposit on exchange of contracts.

A further deposit may be payable after exchange of contracts however this will depend on what terms you have agreed with the developer when you reserved the property.

We will advice you the amount of deposit payable and when it is payable.

Who holds my deposit?

This will depend on the terms of the Agreement. Generally, "new build" contracts provide for the deposit to be held as "agents" for the seller, which means that the deposit will be released to the developer following exchange. If the deposit is held by the seller's solicitors as "stakeholder" then they will hold this deposit and ensure it is not paid out to the seller until completion.

What happens if the developer is unable to complete the construction of the property for fraudulent reasons or because the developer becomes insolvent?

Provided the seller/builder is registered with NHBC, the warranty will offer protection against any loss if the registered builder becomes insolvent after exchange of contracts. NHBC warranty will indemnify you for losses of up to 10% of the purchase price.

We have been given an estimated completion date by the developer. Can we rely on this?

Any date that you are given by the site office should be treated as estimates. The developer can not guarantee the exact completion date but will generally do its best to deliver the completed property within the timescales set. You should liaise closely with the Developers and its Agents in this respect.