Types of mortgage?
- Interest only
- Repayment
- Fixed rate vs variable
- Offset
- Flexible
- Buy-to-let
Common lender requirements?
- Borrower has appropriate credit score.
- Occupiers agree that their interest falls behind that of bank.
- Independent legal advice if family member is being asked to agree to a mortgage to secure family home.
Practicalities of exchange of contracts?
Formula A - One party holds both signed parts and solicitors agree on date.
Formula B - (most common) - when both solicitors hold their own clients respective signed contract and over telephone agree to insert the dates.
Formula C - Chain of transactions.
Methods of completion?
- SC dictate completion date is 20 ays after the date of the contract, but time is not of the essence until NOTICE TO COMPLETE.
- Completion is often done by post, confirm by telephone that sums are transferred.
Remedies for delayed completion?
- Common law - breach of contract
- Contractual compensation - contract rate
- Notice to complete - makes time of the essence + have to top up deposit.
- Rescission - after 10 working days of notice to complete + keep deposit.
What is the purpose for an agreement for lease?
Where a lease is to be agreed between a T and LL the contract is an agreement for lease.
Absolute covenants vs qualified
Absolute cannot be disputed.
Qualified can be done with consent.
Fully qualified - consent cannot be unreasonably withheld.
What is a licence to assign/underlet?
landlords permission for a tenant to assign or underlet - must be expressly provided for in the lease.
Covenants and easements before and after 1996?
Before 1996 - first tenant will always be liable for breaches of covenants under privity of contract.
After 1996 - Liability will pass with privity if estate and can require an outgoing tenant to give an AGA before giving consent to the assignment.
forfeiture as a remedy for breach of leasehold covenant?
Landlord is taking tenant property and ending the lease, must expressly provide for it.
s 146 notice must be served.
other remedies for breach of leasehold covenants?
- Commercial rent arrears recovery (CRAR).
- Special performance.
- Damages.
- Self-help.
Requirements for security of tenure under 1954 act
- Be a business
- have leasehold for business purposes.
- not be contracted out of act.
What are the notices and requirements?
- s 25 Landlord terminating between 6 and 12 months
- s 26 Tenant request for renewal
- s 27 tenant termination give landlord 3 months.
What if there is only a few days between exchange and completion ?
Likely that deposit will be held by client and whole purchase price will be transferred upon completion - if more then a week they are likely to request deposit
Who pays for the indemnity insurance ?
Matter of negotiation - it will be in place from completion onwards as this is when buyer legally owns
