Buying a Property: What You Should Expect on Settlement Day
At last, the wait to move into your new property is almost over. But what actually happens on settlement day? Below is a brief guide to what you should expect on settlement day.
Exchange of documents and payment
In order for the transaction to be completed, the parties involved (your legal representative, the legal representative of the seller, your bank and the bank representing the seller) must exchange legal documents and payment. These documents normally include:
- Cheques: These will be issued by your bank and will cover the purchase price. The seller's legal representative and bank with both check that the payment is valid and for the correct sum.
- Land Documents: Land documents should have been completed before the settlement date. They will be reviewed by all parties on the settlement day in order to ensure that they are correctly completed and ready for submission to the land registry office.
- Documents Detailing the Release of the Mortgage: This will be provided by the bank which represents the seller once they are happy that the correct payment has been received for any outstanding amount of the mortgage they issued. This allows the land registry office to remove any record of the previous mortgage from the title associated with the property.
Adjustments to the agreed price of the purchase
Although any adjustments to the purchase price will have been drafted well ahead of the settlement day, the parties involved will carry out a final check on the day to ensure everything is in order. These adjustments are designed to ensure that both the buyer and the seller pay their fair share of any periodic outgoings during the time they legally owned the property. They generally only cover charges which relate to the land and not charges which may be related to the owner or occupier such as the cost of the internet or phone line.
An inspection of the property
On the settlement day, it is generally a good idea to carry out one last inspection of the property you are about to buy. This will allow you to confirm that the property is still in the same condition it was when you signed the contract and agreed to buy it.
If you are in the process of buying a new home and require legal help, you should contact a lawyer who specialises in conveyancing. They will be able to assist you in filling out any necessary paperwork and will guide you through the settlement process.