What is caveat emptor?
Under the principle of caveat emptor, the buyer cannot recover damages from the seller for defects on the property that rendered the property unfit for ordinary purposes. The only exceptions are if the seller actively concealed latent defects or otherwise made material misrepresentations amounting to fraud.
With the onus being on the buyer’s property solicitor to ascertain if there are issues that would hinder or stop the buyer from proceeding, it is essential that your solicitor is trained to know what really is an issue. Even if you are prepared to take a risk, if your mortgage lender isn't, then you will be forced to either obtain the relevant documentation needed to proceed or pull out from the property purchase.
What enquiries is the buyer's solicitor going to raise?
In England and Wales, property is bought caveat emptor: this makes the role of the buyer’s property solicitor so important. These are just some of the legal issues commonly found when buying a property and which a buyer's solicitor will raise enquiries about:
- No planning permission – Your solicitor will check this by reviewing the local authority searches.
- No building control sign off – Your solicitor will check this by reviewing the local authority searches to see if there was any planning permission or building control sign off (see an example Local Authority Search).
- Any right of way – Your solicitor checks this by reviewing the property deeds.
- Gas boiler certificate – The sellers should provide evidence that the boiler was installed and registered with Gas Safety and that the boiler has been annually maintained.
- Property deeds – If the seller has no deeds and the land is unregistered then your solicitor needs the seller to confirm their client has the right to sell the property to you (in these cases an Epitome of Title may be required). The challenge here is if the seller doesn't hold the deeds to the property, that you need to ensure no one else has a beneficial right to your title after you purchase it.
- Restrictions on the title (restrictive covenants) – Your solicitor will need to ensure that all restrictions are removed from the title by the seller’s solicitor. Restrictions include matrimonial homes rights, creditor debt, mortgage interest, not being allowed to extend, whether you can dry your clothes in the garden or even if you are allowed pets.
- Issues with the ownership of the property - Your solicitor will need to confirm that the seller has the right to sell the property to you and is who they say they are (the obligation of knowing who the seller is will fall on the due diligence of the seller's solicitors).
- Negative property searches - Your solicitor will obtain property searches to inform you of potential issues with the property and these include highlighting flood risk, contaminated land, planning permission granted or denied and drainage access points to the property. You can read more about which searches you will need here - Property Searches - Which ones do I need when buying a home?
- Vacant possession - You solicitor will need to ensure the property is sold vacant possession. This means that no one is living in the property at the time you take ownership, unless otherwise agreed (for example a sitting tenant for a buy to let landlord - sometimes landlords take over the tenant from the previous owner).
- Uncertain title - Where the seller has not been forthcoming with information about the property.
- Check the lease (if leasehold) - There are many points to check in the lease, however one of the key points is to understand how long you have left to run in years on your lease. A buyer may struggle if they are getting a mortgage to buy a property if the lease has less than 80 years because mortgage lenders don't like lending on a short lease (a short lease has under 80 years left to run). You can read more about Lease Extensions.
- Mortgage restrictions - If you are getting a mortgage then your solicitor needs to satisfy the standard conditions provided in the Council for Mortgage Lender's (CML) handbook along with any specific conditions such as confirmation of gifting or that the property has had a structural survey. It is important to get your mortgage offer to your solicitor as quickly as possible and this is an article that explains how to do this - The Mortgage Process
Any one of these issues could hinder your ability to purchase the property and it is for your solicitor to investigate any that arise during the conveyancing process.
*Fixed Fee – No Sale No Fee – On all Mortgage Lender Panels
