Property

Question 1

Types of mortgage?

Answer 1

• Interest only
• Repayment
• Fixed rate vs variable
• Offset
• Flexible
• Buy-to-let

Question 2

Common lender requirements?

Answer 2

• 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.

Question 3

Practicalities of exchange of contracts?

Answer 3

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.

Question 4

Methods of completion?

Answer 4

• 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.

Question 5

Remedies for delayed completion?

Answer 5

• 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.

Question 6

What is the purpose for an agreement for lease?

Answer 6

Where a lease is to be agreed between a T and LL the contract is an agreement for lease.

Question 7

Absolute covenants vs qualified

Answer 7

Absolute cannot be disputed.

Qualified can be done with consent.

Fully qualified - consent cannot be unreasonably withheld.

Question 8

What is a licence to assign/underlet?

Answer 8

landlords permission for a tenant to assign or underlet - must be expressly provided for in the lease.

Question 9

Covenants and easements before and after 1996?

Answer 9

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.

Question 9

forfeiture as a remedy for breach of leasehold covenant?

Answer 9

Landlord is taking tenant property and ending the lease, must expressly provide for it.
s 146 notice must be served.

Question 10

other remedies for breach of leasehold covenants?

Answer 10

• Commercial rent arrears recovery (CRAR).
• Special performance.
• Damages.
• Self-help.

Question 11

Requirements for security of tenure under 1954 act

Answer 11

• Be a business
• have leasehold for business purposes.
• not be contracted out of act.

Question 12

What are the notices and requirements?

Answer 12

• s 25 Landlord terminating between 6 and 12 months
• s 26 Tenant request for renewal
• s 27 tenant termination give landlord 3 months.

Question 13

What if there is only a few days between exchange and completion ?

Answer 13

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

Question 14

Who pays for the indemnity insurance ?

Answer 14

Matter of negotiation - it will be in place from completion onwards as this is when buyer legally owns