ESTATE LINKS PURCHASE PROCEDURE IN THE U.K

Pre-Purchase Procedure

The first step is sourcing for your perfect investment. This depends on the type of investment which includes a buy-to-let investment, a short-term refurbishment investment or if it is for personal use. Once this is known, other factors such as location, number of bedrooms, type of home and budget would come into consideration. Expert recommendations would also be given as some budgets might not match the sort of home being sought after. Once the budget matches the type of property required the options will be sourced and sent to the prospective buyer to make a decision on the property that fits the vision best. An offer will then be made for this property with an ID & proof of funds of the buyer. Once it is done, we move forward to the deal.

Investment Areas

We have selected areas in the UK which we target for certain investments and price points. Below are the areas we tend to target within the UK as well as the potential price points. The areas below make
sure there are different price point brackets for different clients.
a) Durham County- £40,000 – £60,000
b) Burnley- £60,000 – £110,000
c) Manchester- £180,000 – £250,000
d) London & Greater London- £250,000 – £900,000

We also have contacts in all areas around the UK which means our expertise is not limited to the areas
above.

Purchase Procedure

Before going ahead with the purchase procedure an important question is if the buyer needs any sort of financing. Over the years non-resident financing has become harder to come by due to most banks not wanting to take on the risk of lending to individuals who aren’t already in the UK system. We have partners who finance non-residents with a 55%-65% LTV (Loan To Value), with interest rates that currently start from 6%. If the client does not already have a bank account, we then assist the client to open an account. If financing isn’t needed and this is a cash deal then the next step is the property purchase documentation which is handled by the solicitors. Once these documents have been provided and filled,the solicitors will begin their searches on the property by helping check the property title, examine pre-contract package, report to the buyer on pre-contract investigations with a full report, draft contract to seller, send signed contract & deposit to seller’s solicitor.
This procedure usually takes 4-10 weeks depending on the buyer and the peculiar situation of the property. Once all the checks are complete and the buyer is happy to go ahead the purchase price, stamp duty land tax and solicitor’s fees are sent to the solicitor to close the deal. Contracts are exchanged and the buyer receives the keys to the property Post Purchase/ Management Once the purchase procedure is done, contracts are exchanged and the new buyer has their keys, the next stage would be management of the property and insuring the property. This comes into play for buyers who are not buying for personal use. The average management fee in the UK is 10% of the rent. This includes helping the landlord with the following: finding a tenant for the property, helping to get, insurance, gas safety, fire regulation safety, electrical equipment safety, inventory & condition report, cleaning, rent collection & maintenance. This is seen as important as non-resident purchasers do not live in the country and therefore need professionals to make sure the property is being properly taken care of and rent is paid on time every month.
Guaranteed rents are an option that can be taken up by buy-to-let investors. A rental figure is agreed to be paid on a monthly basis regardless of if the property is tenanted or vacant. This helps to avoid any sort of void period of looking for a new tenant when the current tenant is ready to vacate the property.

We currently have partners who offer guaranteed rents and would sign a contract with the landlord to pay the agreed rental value for the number of years agreed within the contract. This rental value can also be reviewed on a periodic basis to make sure the rent being received is in tangent with the rental market standard.

REFURBISHMENT PROJECTS

We also typically take on development projects on a yearly basis. Below are key factors to consider when looking to develop & refurbish a property:
• Find the best purchase price with room for refurbishment costs
• Find a project we can add value to
• Refurbish to rent out or sell for profit
• Potential yield of at least 20% ROI when we refurbish to sell
• Ceiling Value of potential refurbished property would generally be monitored to avoid going over budget

Below are some of the properties within the UK we have successfully developed, refurbished and sold
between 2008 & now with profit made from each project.
a) Stephendale Road, London- £350,000+ profit
b) Broxbourne Road, London- £300,000+ profit
c) Campden Road, London- £100,000+ profit
d) Caithness Road, London- Current Project

DOCUMENT REQUIREMENTS

A. If Employed
 6 months’ pay slips
 6 months personal bank statements (it is important to include the statement where the
clients’ salary is paid into)
 Letter confirming emoluments (it could be the clients’ promotion letter, employment letter, pay
packages etc.)
 Evidence of deposit
 Proof of address (utility bill)
 Copy of international passport
B. Self-employed
 3 years audited accounts with letter confirming emoluments
 6 months company bank statements
 6 months personal bank statements
 Evidence of deposit
 Proof of address (utility bill)

 Copy of international passport
 Certificate of incorporation/CO7

LEGAL PROCESS

Solicitors based in the UK handle this section of the process. They act on your behalf and with your authorization. All documents pertaining to your mortgage application will be sent to us before we forward them to you for an instant and efficient seamless transaction. A KYC process will be initiated by the Solicitor.
To give an idea of cost involvement and the purchase process, we have assumed a purchase price of £400,000 for this mortgage illustration. As mentioned earlier, you will be contributing a minimum of 30% of the purchase price of the property while the bank would be financing 70% The following is the procedure to be followed after the bank has reviewed your documents and given an approval in principle:

EVENT

1. The bank will send surveyor to carry out a valuation of the property. Duration: Approx. 14 days
2. Search fee to be paid to the solicitor acting for. This is usually £500 to be taken out of the admin
fee
3. Mortgage fees deducted from your account by the bank.
4. Contracts are drawn and sent to you. Duration: 28-60 days after payment of search fee and
completion of valuation
5. Return duly signed contracts to the solicitor together with your first 10% deposit for exchange of
contracts. A completion date is agreed here.
(Usually 21 days -28 days)
6. Completion stage. Send your balance of another 20-35% together with the following (all to the
lawyer):
 Local Authority, water & environmental search
 Land registry fees
 Solicitor’s fee + VAT
 Land registry search fees, bankruptcy search,
 Bank transfer fee, acting for your lenders + VAT,
 Admin fee + VAT, etc. £2,000 (dependant on the bank)
 Stamp duty (deals between £125,000 – £250,000) £2,500

 Solicitors fee + VAT £1,800 (average fee)
 Lenders Valuation £600 – £1,000 dependant on the bank Keys are then received and the transaction is closed.
* All the above will be paid direct to the solicitor
*Stamp duty also varies depending on the purchase price.
*For cash purchases, the procedure is the same apart from the fact that there will be no valuation(hence no lenders valuation fee) and the first step being the tory valuation will not be necessary.
Estate Links Fee Scale
 5% for deals up to £100,000
 £5,500 for deals up to £101,000 – £150,000
 £6,000 for deals between £151,000 – £220,000
 £7,000 for deals between £221,000 – £300,000
 £8,000 for deals between £301,000 – £350,000
 2.5% for deals above £350,000