Buying at Auction FAQs

If you are considering purchasing a residential property at auction, this is very different to the more conventional method of buying a house via an estate agent, not least when it comes to the timescales and potential risks involved. Still, in the current economic climate, securing a property at a potentially discounted price is something regular homebuyers, as well as property investors, are becoming more and more interested in.

Below we have set out three frequently asked questions to help you make an informed decision as to whether buying a residential property at auction could be right for you.

What are the timescales involved when buying at auction?

As the entire process is designed to be extremely quick, finances already need to be in place before you bid. This is because you will usually be required to put down a 10% deposit on the day, where contracts are treated as exchanged as soon as the hammer goes down.

You will then usually have between 14 days to 6 weeks to pay the remaining balance of the purchase price. If you fail to complete by the contractual completion date, very often just 20 working days from the date of the auction, this can mean that you will lose the deposit monies paid, along with the property. You will also be in breach of contract.

What are the risks involved when buying a property at auction?

In addition to ensuring that you can pay the purchase price within a short period of time, there are various other risks involved when buying a property at auction. This is because it is not uncommon for auction bidders to overlook important legal issues that could impact the value of the property or undermine any potential plans that they may have for it.

It is therefore important to have a solicitor look over the property legal pack on your behalf prior to bidding. This should be available from the auction house, typically to download, and will include things like a copy of the property’s title, the results of land registry and local searches, and any special conditions attached to the sale, such as clauses that prevent development or certain types of use. It should also include information about any planning permission granted in relation to the property, any leases or tenancy agreements that may be in place, and information about the property’s fixtures and fittings.

Importantly, once the hammer falls on your winning bid, you are legally committed to buy the property and cannot back out if you subsequently discover any problems.

Do I need to pay for a survey before I bid on a house at auction?

The responsibility for checking that the property matches its auction catalogue description lies with the buyer. This means that you will need to view the property and, if you would like to know the condition of the property, get a survey done before the auction takes place.

Paying for a survey on a property that you are not sure you will successfully secure can seem like a costly risk, but the risks associated with not getting a survey done, and possibly buying a property with serious structural issues, means that this is strongly advised.

Needless to say, these ‘Buying at auction FAQ’s’ answer only a few of the possible questions that potential bidders may have. If you are looking to purchase a property at auction, it is always best to first seek expert advice, tailored to your specific circumstances and needs.

Legal disclaimer

The matters contained herein are intended to be for general information purposes only. This blog does not constitute legal advice, nor is it a complete or authoritative statement of the law in England and Wales and should not be treated as such. Whilst every effort is made to ensure that the information is correct, no warranty, either express or implied, is given as to its’ accuracy, and no liability is accepted for any errors or omissions. Before acting on any of the information contained herein, expert advice should be sought.

Contesting a Will

Testamentary freedom, or the ability to leave one’s worldly wealth to whomever we choose, is the cornerstone of succession law in England and Wales. However, there are certain circumstances, even where a deceased has documented their final wishes within a Last Will and Testament, that a Will can be contested. Below we look at different contentious probate disputes and the basis upon which contesting a Will can potentially succeed.

On what basis can a Will be contested?

Contentious probate cases can cover a range of possible scenarios, although one of the most common types of claim, known as an Inheritance Act claim, is where adequate provision has not been made within a deceased’s Will for either a close relative or anyone else who was financially dependent on the deceased immediately before they died.

Under the Inheritance (Provision for Family and Dependants) Act 1975, a potential claim can be made to the court to vary the distribution of the deceased’s estate by certain categories of people, so long as a claim is issued within 6 months of the date that probate is granted. The potential categories of Claimant can include the deceased’s spouse or civil partner; their former spouse or civil partner, provided they have not re-married; any cohabiting partner, provided they lived with the deceased for a period of 2 years prior to their death; and any child of the deceased, including both minors and adults, as well as adopted and step-children. A Claimant can also include any person who immediately before the deceased passed away was being maintained, either wholly or partly, by that person.

Subject to the Claimant being able to show that they were financially dependent on the deceased and that adequate provision has not been made for them on death, the 1975 Act gives the court a relatively wide discretion to make an order to vary the distribution of the deceased’s estate by way of a single lump sum, regular payments or transfer of property.

In some cases, it may also be possible to contest the validity of the Will itself. This could be on the basis of testamentary capacity, where the deceased was arguably not of sound mind when they signed their Will. Additionally, it could be argued that the deceased was coerced into making their Will, or that the Will has been forged, or even that the Will has been improperly executed, such as not being witnessed correctly. In these types of cases, unless the deceased had in place a previous and valid Will, the estate would be distributed in accordance with the rules of intestacy, as if the deceased died without making a Will at all.

How should you go about contesting a Will?

Contesting a Will can be a complex and difficult process, especially at a time when you already feel overwhelmed whilst still grieving the loss of a loved one. However, with the right legal advice and representation, your solicitor can help you to build a strong case, with sufficient evidence in support to succeed. The most important thing in the context of contentious probate claims, is seeking expert assistance as soon as possible, ideally prior to distribution of the deceased’s estate to the beneficiaries under the Last Will and Testament.

By seeking immediate expert advice over any concerns as to the validity of a Will, or if you feel that you have not been adequately provided for by the deceased, you can explore the possible options available to you and make an informed decision as to how best to proceed.

Legal disclaimer

The matters contained herein are intended to be for general information purposes only. This blog does not constitute legal advice, nor is it a complete or authoritative statement of the law in England and Wales and should not be treated as such. Whilst every effort is made to ensure that the information is correct, no warranty, either express or implied, is given as to its’ accuracy, and no liability is accepted for any errors or omissions. Before acting on any of the information contained herein, expert advice should be sought.

Firm Appoints New Director

Blackhurst Budd Solicitors have appointed Sharon Emslie as a Director.

Sharon has been Head of the Family Law department since 2019 and is a Chartered Legal Executive. She advises clients on all aspects of relationship breakdown including divorce, finance and children. Sharon is also one of a small number of Lawyers with experience in the law surrounding surrogacy, fertility and adoption.

Having worked in the legal sector since 1997, Sharon studied the ILEX pathway, becoming a qualified Chartered Legal Executive in 2012. She has dealt with a wide range of family law matters including providing advice on high net worth divorces, complex court proceedings and international relocation cases.

Sharon joins the Board of Directors at Blackhurst Budd alongside Ian Bentley, Rose Spencer and Briony Hayley.

Warren Spencer, Managing Director commented:

“We are delighted to have Sharon on the Board. Since her arrival at the firm her contribution has been fantastic, growing the family team and expanding the services we offer. I look forward working with her on the wider management of the business in the future.”

Sharon added:

“The family law team has gone from strength to strength over the last few years and is an area of law that is less effected by the economic climate than others and therefore one we want to grow further.

Clients looking for advice on fertility law and surrogacy matters often feel they need look to large city-based firms for advice, but we have the expertise here in Blackpool to service clients across Lancashire and at a lower cost.

I am thrilled to have been appointed as a Director at Blackhurst Budd and look forward to the new challenges that will bring.”

Pictured: Warren Spencer, Sharon Emslie.

Dealing with a bankrupt beneficiary

Acting as a personal representative carries with it significant responsibilities, especially when it comes to distributing the deceased’s estate to the right beneficiaries. Below we look specifically at the rules relating to bankrupt beneficiaries, together with the potential consequences of getting this wrong.

What happens if a beneficiary is bankrupt?

When dealing with the estate of someone who has died, either as a named executor of the deceased’s Will, or as an administrator where a person has died intestate, it’s important to check whether any of the beneficiaries have been declared bankrupt. This is because, where a person has been made bankrupt, any assets to which a beneficiary would otherwise be entitled should not be handed over directly to the bankrupt beneficiary, but to the trustee in bankruptcy instead.

The trustee will essentially take over the financial affairs of the bankrupt individual, including taking control of any inheritance received where, with the exception of paying that person any living expenses, these funds will be used by the trustee to pay off creditors in order of preference.

What are the consequences of distributing assets to a bankrupt beneficiary?

The executor or administrator of an estate has a legal duty to distribute the residuary estate to the right beneficiaries. This would normally be the named beneficiaries under the terms of any Last Will and Testament or, alternatively, those beneficiaries entitled to inherit under the rules of intestacy.

However, in the context of any bankrupt beneficiary, the correct person to which any funds should be given becomes the trustee in bankruptcy, not the beneficiary themselves.  As such, if an executor or administrator mistakenly distributes all or part of the deceased’s estate directly to a bankrupt beneficiary, and that beneficiary refuses or is no longer able to return the money, the trustee could bring a claim against them to recover the amount paid. In other words, where a personal representative pays the wrong person, and that money cannot be recovered from that person, the personal representative will become accountable.

A bankrupt beneficiary is under a duty to declare their inheritance to the trustee in bankruptcy, where any failure to do so constitutes a criminal offence. However, it is easy to envisage cases where a beneficiary, unexpectedly in receipt of funds that they thought would be swallowed up by their bankruptcy, may decide to conceal their sudden windfall and/or spend it before the mistake is discovered. In this scenario, the executive or administrator would unfortunately be held liable for the unrecovered sums, in addition to the trustee in bankruptcy’s legal costs in claiming this back.

How can a personal representative avoid liability around bankrupt beneficiaries?

The best way to avoid liability around bankrupt beneficiaries is to seek legal advice, costs which can be recouped by an executor or administrator from the deceased’s estate. In this way,  experienced solicitors can undertake the task of establishing whether any beneficiaries are undischarged bankrupts at the time of the deceased’s death, or if any beneficiary was made bankrupt before the estate administration was finalised. If so, any legacy should be paid directly to the trustee in bankruptcy.

Only if the amount passed to the trustee in bankruptcy exceeds the amount owed to the bankrupt’s creditors, can anything be paid to the beneficiary. However, even in these circumstances, everything should still be paid over to the trustee, tasking them with paying any remaining sum to the beneficiary.

Legal disclaimer

The matters contained herein are intended to be for general information purposes only. This blog does not constitute legal advice, nor is it a complete or authoritative statement of the law in England and Wales and should not be treated as such. Whilst every effort is made to ensure that the information is correct, no warranty, either express or implied, is given as to its’ accuracy, and no liability is accepted for any errors or omissions. Before acting on any of the information contained herein, expert advice should be sought.

How do break clauses in commercial leases work?

Break clauses in commercial leases are commonplace. Still, it doesn’t stop alarm bells ringing for both a landlord or business tenant entering into a commercial lease arrangement for the first time. Below we look at what break clauses are, how these work and how to approach them.

What is a break clause in a commercial lease?

A break clause, also known as an option to determine, is a contractual provision providing both parties with a pre-defined mechanism to terminate the agreement early if certain conditions are met. This is a way of offering either party the flexibility to get out of their contractual obligations early, if their circumstances change, such as during an economic downturn.

For example, Company X enters into a 10-year commercial lease with a landlord for retail premises in 2022. The lease includes an agreed break clause whereby either party can terminate the tenancy at any point, on 6 months notice, after the first 3 years. In 2026, Company X experiences financial problems and needs to downscale to stay in business. The landlord is notified of the company’s intention to exercise the break clause and is given the required 6 months’ notice on 1st May 2026. The commercial lease agreement will then formally come to an end on 1st November 2026.

Alternatively, a break clause could provide a specified agreed date, possibly the mid-way point of the lease term, at which point either party can end the lease on the provision of notice.

How should a break clause in a commercial lease be approached?

Before formally entering into a commercial lease agreement, it is important for both parties to carefully consider the contractual provisions by which they will be bound. This is a matter of negotiation between the parties, including the lease term, and whether or not some flexibility should be factored into how long that term will last. This, of course, will depend on the circumstances of the respective parties, for example, a small start-up may be concerned about its longevity and will be looking to include an option to determine in case they hit hard times. Equally, a landlord may be thinking about marketing the premises tenant-free in a few years, or using the premises themselves, or would like the ability to easily remove any troublesome tenant.

However, there are some important considerations when including a break clause, not least the exact wording used to define its scope. The clause must be clear and transparent, and not open to interpretation, in this way minimising the possibility of any potential dispute that may arise over whether a break clause can be exercised and, if so, when the lease agreement will be treated as coming to an end. It is not uncommon for disputes to arise over the circumstances in which a poorly-drafted break clause can be exercised or exactly when a lease will terminate following the exercise of the clause and, as such, the extent of any remaining respective contractual obligations.

By seeking legal advice before signing a commercial lease agreement, steps can be taken to clarify the meaning of any break clause, with suitable amendments made to protect each parties’ interests.

Legal disclaimer

The matters contained herein are intended to be for general information purposes only. This blog does not constitute legal advice, nor is it a complete or authoritative statement of the law in England and Wales and should not be treated as such. Whilst every effort is made to ensure that the information is correct, no warranty, either express or implied, is given as to its’ accuracy, and no liability is accepted for any errors or omissions. Before acting on any of the information contained herein, expert advice should be sought.

Does a deputy or attorney get paid for what they do?

One of the most frequently asked questions around becoming a deputy or attorney, is whether or not a person can be paid for doing this role. The short answer is “no”, although a deputy or attorney may be able to pay themselves for any out-of-pocket expenses reasonably incurred in discharging their functions. They may also, subject to permission, be able to claim the cost of any care provided.

Below we look at what type of expenses and costs can be claimed as a deputy or attorney, and what steps can be taken to ensure that these are deemed reasonable.

What are the rules around expenses incurred by deputies or attorneys?

Even though managing another person’s affairs can be time-consuming, where that person lacks the mental capacity to do this for themselves, this is not a role for which a deputy or attorney can usually charge for their services. That said, a deputy or attorney is not expected to be out-of-pocket for what they are required to do, where all kinds of costs may be incurred, from postage costs for admin tasks to the cost of fuel when running errands, such as collecting benefits or doing banking.

Needless to say, reasonable expenses will also cover the cost of recouping any money spent by the deputy or attorney in paying a third party, such as paying a cleaner to clean the person’s house or paying a builder to carry out repairs to that property. Importantly, however, the deputy or attorney must be able to justify any costs incurred, for example, they must have done their due diligence for any property repairs, such as sourcing several different quotes from reputable and reliable firms.

What are the rules around the cost of care provided by a deputy or attorney?

When it comes to care costs, the position is far more complex.

Whilst it may be possible to claim a gratuitous care allowance for the cost of providing care to the person lacking mental capacity, or even case management services, such as liaising with relevant professionals or managing and overseeing support workers, a deputy or attorney should always seek permission from the Court of Protection first. This is because the deputy or attorney does not have the authority to remunerate themselves in this way, or any other family member, where to do so without the court’s express permission would be in breach of their fiduciary duty.

Instead, the court must be asked to assess the reasonableness or level of remuneration which the deputy or attorney, or any other family member undertaking care and case management services, should be awarded. This is a figure to represent the commercial cost of care as the ceiling, reduced by 20% to reflect the fact that these payments are not subject to Income Tax.

What records should deputies or attorneys keep of costs incurred?

In all scenarios, either when claiming expenses or seeking permission for care costs, careful records must be kept by the deputy or attorney of any costs incurred and tasks undertaken. Being able to provide clear proof and justification for claims made is absolutely paramount when it comes to what is reasonable, including when expenses were incurred and when tasks were undertaken, together with any evidence of this. In this way, there can be no questions over what is legitimate.

Legal disclaimer

The matters contained herein are intended to be for general information purposes only. This blog does not constitute legal advice, nor is it a complete or authoritative statement of the law in England and Wales and should not be treated as such. Whilst every effort is made to ensure that the information is correct, no warranty, either express or implied, is given as to its’ accuracy, and no liability is accepted for any errors or omissions. Before acting on any of the information contained herein, expert advice should be sought.

What are responsibilities and risks of being an executor?

Many people will feel privileged to act as an executor, being trusted with the responsibility of dealing with someone’s estate after they’re gone and ensuring that the deceased’s wishes are honoured. However, with this responsibility comes significant personal financial risk if an executor makes a mistake. So what are the responsibilities of an executor and what happens if they get this wrong?

What are the responsibilities of being an executor?

After someone has died, the executor to an estate has the role of administering that estate and ensuring that the beneficiaries receive everything to which they’re entitled under the terms of the Will. It is, therefore, important that any executor acts in the best interests of the beneficiaries at all times and the correct procedures are followed.

This means that each executor will need to identify and value all of the assets in the estate. They will then need to calculate and pay any Inheritance Tax that may fall due and apply for a Grant of Probate. Once the grant is received, any assets can be sold, all debts can be discharged and, once estate accounts have been prepared and approved, the residuary estate can be distributed to the beneficiaries.

What are the risks associated with being an executor?

Administering and distributing a deceased’s estate can be complex, involving various risks to the executor if they get this wrong, including but not limited to:

• Clearing debts: the executor must ensure that all of the deceased’s debts are identified and paid, where any failure to clear outstanding debts may mean that a claim can be made against the executor in the future, even if they were unaware of the existence of the debt due to an innocent oversight or genuine mistake. The risks to the executor are also exacerbated where there are insufficient funds to pay off all debts, as creditors must be paid in strict order of priority.

• Identifying beneficiaries: the executor must ensure that all beneficiaries who are entitled to inherit are identified. This is not always straightforward, for example, where the deceased’s Will provides for their estate to be shared between ‘all of their children’, but it is not clear how many or who these children are. This type of uncertainty is commonplace in the context of modern families, comprising several descendants from different marriages or relationships. Again, any failure to identify a beneficiary may mean that an executor is held personally liable to the extent of any legacy that any given individual would’ve been entitled to receive.

Other risks can arise around claims made against the estate from individuals who believe that they’re entitled to a share, disputes arising between those with an interest in the estate, or even where an executor mistakenly pays a bankrupt beneficiary, rather than the trustee in bankruptcy. In all of these scenarios, there is the potential for personal liability on the part of the executor.

How can the risks of being an executor be avoided?

The job of winding up someone’s affairs after their death is one that involves both responsibility and financial risk for an executor. It is, therefore, imperative that an executor seeks early legal advice, ensuring that the correct procedures are followed to minimise any exposure to personal liability — from advertising for creditors to checking for any bankrupt beneficiaries.

Legal disclaimer

The matters contained herein are intended to be for general information purposes only. This blog does not constitute legal advice, nor is it a complete or authoritative statement of the law in England and Wales and should not be treated as such. Whilst every effort is made to ensure that the information is correct, no warranty, either express or implied, is given as to its’ accuracy, and no liability is accepted for any errors or omissions. Before acting on any of the information contained herein, expert advice should be sought.

Dealing with hidden assets on divorce

On the breakdown of a marriage, it is not uncommon for the wealthier spouse to seek to hide their assets to help defeat any claim on divorce. However, for any party who tries to conceal their financial worth, and this comes to light, they can expect the court to flex its’ judicial muscles.

Below we look at the importance of disclosure during financial remedy proceedings and what steps can be taken by the court in favour of the financially weaker spouse to deal with underhand tactics. 

What are the rules relating to disclosure on divorce?

When a marriage irretrievably breaks down, and the division of martial assets cannot be agreed, the court may need to make an order. To do this, and to do so fairly in all the circumstances, the parties will be required to provide the court with what is known as ‘financial disclosure’. This is the process whereby both parties to a marriage are ordered to disclose details of their income, property and assets. This should include assets held jointly and individually. It should also include assets acquired prior to, during and even after the marriage has ended. In this way, the court can assess the parties’ respective economic needs, obligations and responsibilities in the context of their financial worth on divorce.

In some cases, there may be assets that one spouse knows nothing about. Still, even if one party has no knowledge that a particular asset exists, this must be disclosed to the court. This is because the parties are legally required to provide full and frank disclosure of their entire financial circumstances.

What are the consequences of non-disclosure on divorce?

There are various ways in which a financially stronger spouse may attempt to defeat or reduce a claim made against them on divorce. These can include converting assets into cash, temporarily transferring assets to family members, placing assets into sham trust mechanisms and moving assets offshore. However, whilst attempts to deploy these kinds of tactics can occasionally be pulled off, the courts have wide-ranging powers when it comes to dealing with anyone who is not playing fair. These include:

• Assessing an award based on the inferred wealth of a party, even if assets can no longer be located

• Notionally ‘adding back’ an asset to the matrimonial pot, as if the asset transfer had not taken place

• Varying or reversing the transfer of assets into a trust or other corporate structure

• Awarding a larger proportion of English-based assets in recognition that these are easier to locate

The courts can also revisit an order once made, setting this aside and ordering a party to pay any legal costs arising from previously undisclosed assets. More importantly, if a party is found by the court to have deliberately hidden assets, they could be potentially prosecuted for fraud.

If you know or suspect that your former spouse is seeking to hide or dissipate assets on divorce, expert legal advice should be sought immediately to help protect your position financially.

Legal disclaimer

The matters contained herein are intended to be for general information purposes only. This blog does not constitute legal advice, nor is it a complete or authoritative statement of the law in England and Wales and should not be treated as such. Whilst every effort is made to ensure that the information is correct, no warranty, either express or implied, is given as to its’ accuracy, and no liability is accepted for any errors or omissions. Before acting on any of the information contained herein, expert advice should be sought.

Key considerations when buying a repossessed property

Buying a repossessed property can provide investors and developers with an excellent opportunity to purchase an apartment or house at a significantly discounted price — in some cases, by as much as 30% less than their market value. Repossessed properties can also provide first-time buyers with a chance to get onto the property ladder. However, there are a number of key considerations that must be taken into account. This is because the process of buying a repossessed house is very different than through traditional methods.

Below we look at three of the most important factors that you will need to consider before buying a repossessed property.

#Key consideration 1 — the risk of being gazumped

Even though a lender has the right to repossess a property in circumstances where the borrower had been unable to meet their mortgage repayments, the lender is under a legal obligation to obtain the best possible price to cover any outstanding debt. This means that when an offer is made by a prospective buyer, the lender, or estate agent on their behalf, will usually publish a 'notice of offer’ in the local press inviting higher bids. In consequence, there is no certainty that your initial offer will be sufficient to secure the property, exposing you to the possibility of being gazumped and losing the property altogether, or being forced to increase your offer. Even then, the property will remain on the open market until completion.

#Key consideration 2 — the unavailability of replies to enquiries

As the repossessed property is being sold by or on behalf of the lender, who will have no personal knowledge of the property, they will be unlikely to be able to provide answers to many of the standard enquiries raised during the conveyancing process. This can include detail of any disputes with or complaints about neighbours, any notices or proposals that may affect the property, any rights and informal arrangements with neighbouring properties, or any alterations or changes to the property and whether consents and approvals were sought. This means that you must carry out a thorough visit to the property to satisfy yourself of such matters, and raise any queries that you may have with either your solicitor and/or surveyor.

#Key consideration 3 — the need to act very quickly

When buying a property under normal circumstances, timescales are relatively relaxed, typically to be agreed between the parties. In contrast, when buying a repossessed property, whether through an estate agent or auctioneers, time is of the essence. This is because the lender will want to recoup their money as quickly as possible. When buying a property at auction, once the hammer goes down, contracts are treated as exchanged. This means that you must pay a 10% deposit or reservation fee on the day, with the remaining balance usually payable within a period of 14 to 28 days. Even when buying a property through an estate agent, exchange of contracts is generally requested within 28 days of an offer being accepted, so you must have your finances in place so that you are able to proceed immediately.

There are a whole host of other factors to take into account when buying a repossessed property, where expert advice should always be sought first.

Legal disclaimer

The matters contained herein are intended to be for general information purposes only. This blog does not constitute legal advice, nor is it a complete or authoritative statement of the law in England and Wales and should not be treated as such. Whilst every effort is made to ensure that the information is correct, no warranty, express or implied, is given as to its’ accuracy, and no liability is accepted for any error or omission. Before acting on any of the information contained herein, expert legal advice should always be sought.

How to repay a help-to-buy equity loan

If you took advantage of the government’s help-to-buy scheme to put you on the property ladder, you may now be looking to pay off the equity loan that was used towards the cost of buying your property. This could be because you’re selling up, have cash savings or are looking to remortgage. Below we look at some of the factors involved in how to repay an equity loan, including how much this will cost, the process to be followed and if a solicitor will be needed.

How much will it cost to pay off an equity loan?

The total amount of help-to-buy equity loan that you will need to repay is not fixed to the amount originally borrowed, but instead calculated based on the market value of your property at the time that you choose to repay and the equity loan percentage amount.

This means that the repayment amount can be lower or higher than the amount originally borrowed. If you are selling, the repayment figure will be calculated based on either the approved current market value or the agreed sale price, whichever is the higher. The amount you will need to repay also includes interest, fees and any outstanding payments.

What is the process to repay an equity loan?

The process to repay an equity loan will depend, in part, on your method of repayment. As your equity loan will be secured as a second mortgage over the title deeds to your property, you may be looking to increase your borrowing on your first mortgage and use this to pay off some or all of your equity loan. If you want to repay just part of your equity loan through remortgaging, you’ll first need to get permission from the administrator for Homes England to change your mortgage provider and increase your borrowing on your existing mortgage.

Provided permission has been sought from Homes England, where applicable, or where you are using the proceeds of sale or cash funds to repay your equity loan, you will then need to instruct an RICS-approved surveyor to inspect your property and provide a valuation report to confirm its current value. You will be responsible for the surveyor’s costs in this regard.

Once you have the valuation report, this will need to be submitted to Target Services Ltd, together with their loan redemption form and administration fee, in order to obtain a redemption figure. Target is a private company appointed by Homes England to administer the repayment of equity loans under the help-to-buy scheme. The valuation report will be valid for a period of 3 months from the date of issue. If repayment does not take place within this timescale, you will need to arrange and fund the cost of an additional desktop valuation.

Is a solicitor needed to deal with the repayment process?

Given that your equity loan will be secured against your property, a specific legal process will need to be followed to ensure its removal once you have paid this off in full. This means that you will need to instruct a solicitor to carry out the legal conveyancing to repay the loan, including checking with Land Registry that the equity charge has been removed.

The legal fees for your solicitor dealing with the transaction will vary depending on the nature of your financing for the repayment of the help-to-buy equity loan.

Legal disclaimer

The matters contained herein are intended to be for general information purposes only. This blog does not constitute legal advice, nor is it a complete or authoritative statement of the law in England and Wales and should not be treated as such. Whilst every effort is made to ensure that the information is correct, no warranty, express or implied, is given as to its’ accuracy, and no liability is accepted for any error or omission. Before acting on any of the information contained herein, expert legal advice should always be sought.