Definitions

Chain

Often there is a line of people who are selling and buying property at the same time and this is called a chain. The number of people involved in a chain can vary, and can sometimes have an affect on the length of time a house sale or purchase takes to go through.

Completion

This is the point at which the sale and/or purchase is completed and keys to the property are released.

Contract

The contract is the agreement to buy and sell a property. There are two copies of the contract, one that is signed by the buyer and the other, which is signed by the seller. Once the contracts have been exchanged there is a legally binding agreement.

Conveyancing

This is term for the legal work that is undertaken in the sale and/or purchase of a property.

Deed

The title deed is a legal document which sets out who owns the property.

Disbursments

These are third party costs that you would have to pay when buying and/or selling a property; these include various searches and Home Information Packs.

Freehold

When you own a freehold property, it means you own the whole of the property and the ground upon which it is built outright. Most houses tend to be owned on a freehold basis, whereas flats tend to be leasehold.

Gazumping

Until the contracts have been signed and exchanged, either party involved in the transaction can pullout of the process at anytime.
If a seller decided to pullout and sell to another buyer who may be making a better offer for the property, this is called "Gazumping"

Home Information Pack

The HIP contains useful information for potential buyers. The pack will contain key legal documents and an Energy Performance Certificate, which assesses the energy efficiency of your home. From 14th December 2007 anyone who wants to put their house on the market is legally obliged to produce a HIP, and failure to do so can lead to a heavy fine.

Joint tenants

If you own your home as joint tenants then both of you own the whole of the property. If one owner dies, the other automatically becomes the sole owner of the home.

Land Registry

The Land registry is where all Freehold deeds and all Leasehold deeds where the Lease has more than 7 years to run have been registered. There are several offices across England and Wales, which serve particular areas.

Leasehold

This usually applies to flats. A leasehold is where the Freeholder grants the exclusive right to occupy a property for a fixed period of time and normally charges a ground rent. At the end of the lease the freeholder is entitled to recover possession.

Maintenance/Service charges

If you have a communal area surrounding your property, e.g. a common drive or garden, then you may have to pay a maintenance charge for its up keep.

Searches

There are various searches that need to be done when you are purchasing a property, these include local searches from the Local Authority, the land registry search, environment search and a water board search.
There may be other searches to be done depending on where the property you want to buy is situated. Your solicitor will advise you if any special searches are required.

Stamp Duty Land Tax

Stamp duty is an amount that is payable to the Inland Revenue on the whole of the purchase price of a property.
You pay Stamp Duty Land Tax on properties such as houses and flats, as well as other buildings and land. If the purchase price is under £125,000 you don't pay Stamp Duty Land Tax. If the property is classed as being located in a 'disadvantaged' area and the property is less than £150,000 there will also be no Stamp Duty Land Tax to pay on the purchase.
If the property you are looking to purchase is more than £125,000, you pay between one and four per cent of the whole purchase price and this is calculated on a sliding scale.

Tennants in common

Being tenants in common means that if you have purchased a house with your spouse or partner, you each own a share of the property. That share is determined at the time of purchase although it can be varied at a later date. If one owner should die, then that share will pass via the deceased's will rather than automatically passing to the co-owner.

Title

This is given to the person/persons who have the right to and owns the property.

Valuation report

This is a basic assessment on the general condition of the property carried out by the mortgage lender and helps to assess if the property is worth the price you may be paying for it. You can carry out a more detailed structural survey at your discretion.

VAT

This is Value Added Tax, payable on sums of money at a rate of 17.5% usually payable on professional fees.

Vendor

The Vendor is the person who is selling the property.