Buying A Property: An Overview Flashcards
Key requirements for a binding contract?
Agent?
Principle?
Key requirements -
There must be offer and acceptance
There must be consideration
Parties must have capacity to contract and intention to create legal relationship
Contract terms must be certain, complete and free from doubt
Can not be for illegal or immoral purpose
The there must be no misrepresentation, duress or undue influence.
The principal is the body that instructs the agent on their behalf
Prior to April 2013, why did the financial ombudsman service find in favour of many policyholders who felt an insurer had unreasonably rejected their claim on the grounds of of a breach of utmost good faith?
There were many cases of insurance companies declining seemingly valid claims because the policyholder failed to disclose information about previous illnesses and medical consultations, even though the fact would have no bearing on the claim and the majority relied on the applicant to determine, remember and list all relevant information.
This was made worse by insurers cutting pre-application underwriting and effectively asked underwriting questions at the point of claim causing issues.
Who pays SDLT?
How is it levied?
What happens if a single transaction involves multiple properties?
SDLT is paid for by the buyer
It is levied in bands, with different portions of the purchase price being taxed at different rates
For multiple properties purchased in a single transaction, SDLT is charged on an average value of each property, rather than on the overall total.
Which regulations make selling agents liable for extravagant or fanciful sale particulars that are subsequently found to be misleading?
The consumer protection (amendment) regulations 2014
In a contract to buy and sell property, both vendor and buyer give a consideration. True or false?
True
The buyers consideration is the purchase money, the vendors is the property being sold
John is acting as agent for Donna. John carries out a transaction that appears to be outside his authorisation but Donna confirms that she is happy with what he did. The technical term for this is
A) apparent authority
B) additional authority
C) ratification
D) retrospective authority
C) ratification
Fred and Eileen are about to put their house on the market and are considering whether to agree a sole agency in the hope of achieving a quicker sale. What would be the likely disadvantage to Fred and Eileen of the joint sole agency approach?
The commission each agent charges is likely to be higher than if they had sole agency
Who is liable to sanctions for a sales brochure that exaggerates the size of the main living room?
A) the vendor
B) the estate agent
C) the vendors solicitor
B) the estate agent
The Energy performance certificate
A) must be received by the estate agent before a property can be marketed
B) is commissioned by the buyers solicitor as part of the searches
C) must be commissioned before the property can be marketed
D) will cover all the flats in a block
C) must be commissioned before the property can be marketed
Dues but have to be received but vendors responsibility
Once a lender has issued an offer of advance and the applicant has accepted it, the lender is bound to go ahead with the transaction. True or false?
False
The are a number of situations in which the lender may withdraw the offer
Material changes to property
Dishonesty of buyer
Affordability
Defects in the title
Indira had exchanged contracts on the sale of her flat a week before her kitchen was badly damaged by a fire that caused structural damage. Who was responsible for insuring the property at the time the damage occurred?
A) Indira as the vendor
B) the buyers lender
C) Indira’s solicitor
D) the buyer
D) the buyer
At the point of exchanging contracts
Either vendor or buyer can drop out of the sale/purchase of a property at any point up to the completion date. True or false?
True
Technically either can withdraw but the buyer would lose their deposit after exchanging contracts and either could be sued for breach of contract
Which of the following would not be a legitimate reason to arrange exchange of contracts on a conditional basis?
Exchange is conditional to:
A) sale of another property
B) satisfactory valuation of the property
C) satisfactory search result
D) a long stop date
B) satisfactory valuation of the property
The valuation would be needed for the mortgage, this should be arranged before exchange if contracts
James has heard that bargains can be found by buying at property auctions. What cautionary advice would you give him?
A successful bid is binding
10% deposit and exchange of contracts in the day
There is no time to change your mind
Finance cash or mortgage must be in place prior to the bid
The survey and preliminary legal work must be completed before the auction
This can all be money wasted if unsuccessful in bidding
If successful the buyer then pulls out they lose their deposit and may be liable to pay for a shortfall at a subsequent sale
