Purchase & Sale

Question 1

What is the key legislation governing the sale of property in the UK

Answer 1

Estate Agents Act 1979
Consumer Protection from Unfair Trading Regulations 2008
Misrepresentation Act 1979
Bribery Act 2010
Money Laundering Regulations 2017

Question 2

What is the difference between informal and formal tender

Answer 2

Formal:
- The highest offer is accepted unless stated in the terms and conditions
- Full marketing material to include a legal pack is provided to all purchasers
- All bids to be opened in front of the client and an independent witness
- Client can proceed to contracts after the purchaser is selected.

Informal:
- No legally binding
- Can be used during private treaty sales
- Further negotiations can follow
- Vendor has flexibility to chose what ever bid he wishes.

Question 3

Can you explain the Auction process

Answer 3

1. ToE must be agreed in advance and conflict of interest checks conducted.
2. Full due diligence conducted on the property
3. Property is marketed for sale via Auction
4. AML checks conducted on all purchasers in advance of the auction.
5. Reserve price to be agreed with the vendor.
   6.

Question 4

Why would you use the informal tender process over private treaty

Answer 4

Generally the informal tender process is used where there is high demand for a property such as agricultural land.

It generates competition between purchasers which can lead to a higher sale price than the PT method.

Question 5

Can you explain the process of a sale from start to finish

Answer 5

1. Enquiry taken followed by an inspection and information gathering.
2. MA drafted and sent to the client with ToE.
   MA contains details of the property, guide price, fees, marketing strategy.
3. upon signing of the ToE AML checks conducted on the client, particulars drafted and property launched
4. Viewings conducted and all offers disclosed to the client.
5. Once the client has chosen an offer memorandum of sale is drafted and sent to solicitors to start conveyancing.

Question 6

What is the conveyancing process

Answer 6

1. Agent produces memo of sale and instructs both solicitors
2. Solicitors conduct their due diligence
3. contracts exchanged (10% deposit) and agents fee paid
4. Contracts exchanged and funds transferred.

Question 7

What is AML

Answer 7

Anti Money Laundering

Money Laundering, Terrorist Financing and Transfer of Funds Regulations 2017

Customer Due Diligence
- To identify the client and verify their identity
- 2 forms of identification: Driving licence, passport, bank statement, utility bill.
- No more than 3 months old.

Question 8

Can you explain how you dealt with the surrender of the AHA tenancy in your summary of experience?

Answer 8

1. Obtained copies of the agreement and ascertained if there are succession rights
2. Identified that the tenant is the last successor to the AHA.
3. Conducted a term and reversion valuation of the land subject to the tenancy
4. Divisible surplus split 50:50 to calculate a settlement figure.
5. Settlement agreement signed by both parties.

Question 9

What are the different interests in property

Answer 9

Freehold - Free and in absolute possession
Leasehold - Subject to tenancy