When it comes to buying or selling a property, conveyancing is an essential part of the process. However, the true costs involved often come as a surprise to many.
While most people are familiar with the basic fees, several hidden costs can add up, and failing to account for these can lead to financial strain later on.
With help from SAM Conveyancing, let’s take a closer look at these hidden expenses, so you can plan effectively and avoid any surprises.
Disbursements and searches
One of the most overlooked costs in conveyancing is the disbursement fees.
These are costs that the solicitor or conveyancer will pay on your behalf to third parties, such as local authorities or environmental agencies, to carry out essential checks.
These checks include land registry searches, local authority searches, and environmental searches, which are necessary to ensure there are no legal or environmental issues with the property.
Disbursements can range from £100 to £400 depending on the area and type of property.
In addition to these, there are fees for other essential services, such as obtaining official copies of documents or registering the property with the Land Registry.
These costs can accumulate quickly, so it’s important to budget for them.
Stamp duty
Another significant cost is stamp duty, a tax on property transactions. The amount you’ll need to pay depends on the property price and whether you are a first-time buyer, a second-time buyer, or an investor.
For properties over £125,000, you will need to pay stamp duty, and this amount can vary significantly.
It’s crucial to check whether you qualify for any exemptions or reductions, such as for first-time buyers or if the property is under a certain value.
A conveyancer can help ensure you’re paying the correct amount and can guide you through the various reliefs available.
Legal fees and VAT
The legal fees themselves can be another hidden cost. These fees are typically fixed, but they can vary depending on the complexity of the transaction and the conveyancer’s experience.
For a straightforward sale or purchase, you might expect to pay around £500 to £1,500. However, if the process is more complicated, such as in the case of leasehold properties or complicated title issues, the costs can be much higher.
Additionally, VAT will be charged on these fees, typically at the rate of 20%.
This means that the final cost of your conveyancing could be considerably more than the initial quote you receive, so always clarify whether VAT is included or not.
Removal costs and insurance
When budgeting for conveyancing, many overlook the cost of removals.
Moving home can be an expensive undertaking, with the average cost for removals in the UK ranging from £300 to £1,000 depending on the size of the move and the distance.
It’s important to factor this into your overall moving budget.Similarly, you may also need to take out home insurance or buildings insurance, particularly if you are taking out a mortgage.
Your lender may require this as a condition of the loan, and this cost should be considered alongside the conveyancing fees.
Preparing for the hidden expenses
Preparing for the hidden costs of conveyancing ensures that your property transaction goes as smoothly as possible.
Keep a comprehensive list of expected fees and don’t hesitate to ask your conveyancer about any potential additional costs.
1 Comment
More importantly today a land search to ensure the house hasn’t been built on a flood plain