Today, we will briefly explain to you the process of purchasing a property in the UK in 3 steps.
In the process of purchasing property in the UK, you can first reserve the property you like by paying a reservation fee between £1000 to £5000. Upon payment of this fee, the property subject to sale is reserved for you. A reservation contract is then drawn up, completed and your signature is taken.
The copy of this document will be sent to you, as well as the seller’s and the buyer’s lawyers. In the reservation contract, the sales price, discount amount, deposit paid for the reservation, identity information, address, lawyers’ information and a brief related to the sale are stated.
Generally, a period of 4 to 6 weeks is given to complete the process. During this period, the property is not offered for sale to any other potential buyers. In case of cancellation, or if the transactions cannot be completed within this period, the reservation fee is generally refunded. However, it is definitely beneficial to get confirmation that the reservation fee is refundable.
You cannot buy real estate in the UK without a lawyer, due to a legal obligation. Unlike Turkey, it is not possible to go to the land registry office in the United Kingdom and make a transfer transaction.
The entire purchasing process is carried out by authorized conveyance lawyers. In addition, all transactions carried out by lawyers are guaranteed by insurance. The system is secure at every stage of the process to protect both the seller and the purchaser. The lawyer conducts legal examinations and research on real estate and also clarifies the investigations regarding the source of the sales price.
This research is briefly called AML (Anti Money Laundering) check, that is, the process of determining the source of funds. If you want to buy real estate in the UK, you must disclose the source of your funds and provide proof. It is mandatory to submit all bank account transactions regarding the source of your funds.
Proof of funds can be salary, dividends received from companies, rent, income from the sale of a property and inheritance. Earnings whose source is unknown and not taxed are considered illegal and your transactions will not be processed.
Another step in the process of acquiring real estate in the UK is the “Exchange”, which is, the signing of the contract after being mutually agreed by both sides’ lawyers. In this process, a down payment of 10 percent is generally paid and the parties are mutually bound by signing the contract. The 10 percent down payment paid is non-refundable. For this reason, it is paramount to be careful when making decisions in this process.
The last step in the process of acquiring real estate in the UK is “Completion“, that is, the transfer of real estate. A date is determined in advance for the transfer of the real estate you purchase. Approximately 7 days before this date, the seller reminds the buyer and his lawyer that the remaining balance must be paid.
The buyer’s attorney prepares a document named completion statement that includes the sales price of the property, attorney’s fees, taxes, and other expenses. On the day of transfer, after the remaining payment is made, the seller’s lawyer delivers the keys to the property and the ownership passes to the buyer.
It should be noted that in this process, all financial transactions are carried out safely through lawyer`s indemnity insurance and state-guaranteed bank accounts. This ensures the protection of the buyer. Any damage you may incur can be claimed from the law firm’s insurance company.
In this article, we briefly explained the process of purchasing property in the United Kingdom. Please do not hesitate to contact us for more detailed information.
