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Often legal terms are confusing and can sound archaic. At Carmody Moran Solicitors we are committed to using ordinary language and not legalese.

As part of our commitment to our clients we have set out below some of the common terms in property transactions:

Booking deposit

This is generally approximately 2-3% of the purchase price and paid either to the auctioneer or through a solicitor by a purchaser to secure negotiations on the contract pending execution of a Contract for Sale. Care must be taken not to inadvertently bind a person to a transaction and for this reason we recommend that you pay a booking deposit only through your solicitor who can protect a purchaser’s position.

Certificate of Title

This is the certificate furnished by your solicitor to your Mortgage company to confirm that the property you are buying has marketable title. The title must be certified as proper marketable title before any lender will advance funds. Sometimes Lending Institutions will engage their own solicitors in-house to certify the title but more commonly in residential property transactions the bank engages the purchaser’s solicitors to undertake to do this legal work on their behalf. When the purchase has been completed and mortgage documentation executed the solicitor then stamps the deeds with the Revenue Commissioners and registers the various legal interests before returning the documents with the Certificate of Title to the Lender.

Closing date

When you sign a contract for the sale or purchase of a property, we will give you a date for when the sale should be closed and the keys handed over. However, unavoidable delays often arise and the sale may not close on that date. When it gets nearer to the date stated in the contract, we will be able to give you an exact date when you can complete the sale or purchase so that you can make the final arrangements.

Contract

Once a contract is agreed, orally or in writing, you are bound at law to the transaction.

Conveyancing

Generic term used to describe the legal steps involved in property transactions such as the purchase or sale of a house or mortgage.

When acting for the buyer, we will investigate the property’s title (ownership) thoroughly and we will ask the seller’s solicitor all the necessary questions. If we are not satisfied with the answers to our questions, or with any other aspect of the sale, we may advise you not to buy the particular property.

When acting for the seller, we prepare all of the documents needed by the buyer’s solicitor.

Deposit

A 10% deposit (less any booking deposit) is generally paid on execution of Contracts for Sale by a purchaser. Sometime a reduction on this amount is agreed between the parties. Once Contracts are executed deposits are generally non refundable and they are governed by the conditions set out in the Contract executed.

Family Home Declaration

A wide range of legal protections apply to a property that is deemed a Family Home. This is defined in the Family Home Protection Act 1976 (as amended). For this reason a declaration regarding the family home is completed by the parties to every sale, purchase, and mortgage transaction.

Good and marketable title

This is the standard of title necessary for you to be able to borrow / mortgage a property. Every property should have this type of title before you purchase it and solicitors investigate title to make sure that you will obtain this on completion.

Investigation of Title

This is the legal work that you engage your solicitor to carry out when purchasing a property i.e. to read the title, raise all necessary enquiries, and ensure that you will obtain good and marketable title if you proceed to purchase the property.

Letter of Loan Approval

This is a letter of approval from a lender that issues specific to the property that is being mortgaged and contains the terms and conditions upon which the lender is proposing to take security and the condition upon which the lender is prepared to grant the mortgage.

Letter of Loan Offer in Principle

This is a broad letter of approval from a lender but is not binding or is it generally applicable to any particular property, rather it is indication of the amount you might be able to borrow from a bank. The property you intend to purchase must first be valued by the bank after your negotiations to purchase it have concluded and then a ‘full’ letter of offer with all of the legal conditions attached will issue. It is the full letter of loan offer that is required for you to purchase a property.

Marketable Title

You must have good title to be able to sell or mortgage a property. Legal principles apply as to how this is determined and once these standards are met the title is referred to as ‘good and marketable title’.

Mortgage

Loan secured on property over which the lender has first legal charge.

Property Registration Authority

A state body which manages and controls the Registry of Deeds and Land Registry and promotes the registration of land ownership.

Qualification on Title

Title may have to be qualified to a Lender when it is deemed that a title is not good and marketable title. If qualifications are necessary it is open then to the Lender to accept the qualifications on title or reject the proposals or impose such conditions as they see fit before granting or refusing the loan.

Short Sale

The sale of a property in negative equity i.e. the amount owed on the house is greater than its market value.

Solicitor’s Undertaking

This is the binding legal promise that a Solicitor gives to a lender to say they will be able to produce a Certificate of Title at the completion of the mortgage transaction.

Stamp Duty

Tax payable on property transactions.

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