Podcast Summary
Ensure your solicitor is on your lender's panel for a smoother transaction: Checking a solicitor's panel status with your lender saves time, money, and potential complications during property purchasing.
When purchasing a property, it's important to ensure your chosen solicitor is on the panel of your preferred lender to avoid additional legal fees and potential complications in the process. Most lenders have a list of approved solicitors they work with regularly, and they prefer to deal with those they trust. Therefore, before engaging a solicitor, it's crucial to check if they are on the lender's panel to ensure a smoother and more cost-effective transaction. If your preferred solicitor is not on the panel, you may need to consider using a different solicitor or negotiating with the lender. Sam, the questioner in the podcast, expressed frustration about this issue, as it adds an extra challenge to the already complex process of buying a property. To summarize, checking a solicitor's panel status with your chosen lender can save you time, money, and potential headaches during the property purchasing process.
Focusing solely on mortgage panel isn't the best way to choose a solicitor: Assess a solicitor's abilities, experience, and presence on majority of panels before deciding, not just their presence on a mortgage panel.
While it's important for your solicitor to be on the mortgage lender's panel to avoid complications during the home buying process, it's not the only factor to consider. Some lenders, especially niche ones, have restricted panels, which means your preferred solicitor might not be on it. However, focusing solely on the mortgage panel when choosing a solicitor may not be the best decision, as a great solicitor with experience in dealing with investors can provide invaluable assistance. Therefore, assess your solicitor's abilities, experience, and whether they're on the majority of panels before making a decision. If you're set on a particular niche lender that your solicitor isn't on the panel for, you can engage another solicitor on their panel to handle the lender-specific legal work, but be aware of the additional costs involved. Overall, finding a solicitor who is a good fit for you and your investment property deal is crucial, and their presence on a mortgage panel should not be the sole deciding factor.
Considering the implications of transferring a buy-to-let property and purchasing another property in personal name: When dealing with multiple mortgage lenders or property transactions, anticipate and budget for unexpected costs such as additional legal fees, employing additional solicitors, and dealing with other unforeseen issues.
While dealing with multiple mortgage lenders or property transactions, it's essential to consider the potential extra costs and hassle. If a lender with a restricted panel is only slightly cheaper, it might not be worth the added effort and legal fees. However, if the savings are significant or necessary due to specific circumstances or property conditions, it's an unfortunate reality that additional expenses will likely arise during property purchases. One listener, Marcus, asked about the implications of transferring a buy-to-let property to a limited company and subsequently purchasing another property in their personal name. The good news is that since both properties are first-time purchases, the additional stamp duty rate for owning more than one property won't apply to Marcus. This information can be helpful for anyone considering similar situations. Ultimately, it's crucial to anticipate and budget for unexpected costs when engaging in property transactions. These costs can range from employing additional solicitors to dealing with other unforeseen issues. While it would be ideal to have a clear understanding of the total cost from the beginning, it's wise to mentally prepare for extra expenses.
Higher stamp duty tax for limited companies buying properties: Limited companies face higher stamp duty tax when purchasing properties, making creative tax solutions risky, and political landscape and tax rules may change, so stay informed.
For individuals looking to purchase additional properties as a limited company, they will be subjected to a higher rate of stamp duty tax. This means that creative tax solutions, while appealing, come with risks as some have been shut down by HMRC in the past, and individuals may be required to pay back the costs at a later date. It's important to keep in mind that the political landscape and tax rules may change in the future, so it's a good idea to stay informed about housing-related policies during election season. If you're still undecided about who to vote for, be sure to tune in to the property podcast on Thursday for a rundown of the major parties' housing policies. And if you have any questions for Rob and Rob, feel free to send them in by calling 01380 813353 or visiting propertyhub.net/ask.
