Buying FAQs – Part 1

The process of buying a property can understandably feel daunting, given the myriad of factors and elements to take into account. To aid in this process, we’ve compiled a detailed guide that addresses the most frequently asked questions we receive. Whether you’re a novice buyer wondering about mortgages or a seasoned investor seeking to expand your portfolio, we aim to address your specific concerns and break down the key steps involved in an approachable way. 

Are there any limitations for overseas investors purchasing a house in the UK?

No, there are no such limitations. Any individual, regardless of nationality or visa status, who is over 18 years old can purchase a house in the UK.

If I buy a house in the UK, does it qualify me to immigrate?

Unfortunately, no. Homeownership in the UK doesn’t contribute towards meeting the financial requirements for immigration. 

However, we collaborate with reputable immigration law firms in the UK and can refer you to expert immigration attorneys if you require advice on legal aspects of UK immigration.

Is it possible to buy a house in the UK without having a UK bank account?

Yes, it is feasible. If you are making a cash purchase, a UK bank account isn’t necessary. The funds for the purchase can be directly transferred from your domestic or other overseas accounts to the buyer-designated solicitor who will handle all the property purchase procedures. 

However, if you plan to finance the purchase with a mortgage, you will need to open a bank account in the UK. 

Is it possible to get a loan without a UK residence permit?

Yes, it is. Banks such as HSBC, Standard Chartered Bank and Bank of China London Branch cater to clients seeking loans for UK property purchases. We can connect you with loan managers and mortgage consultants.

Can individuals purchase a property in the UK without being physically present?

Yes, they can. The UK property market operates under robust legal frameworks, and all purchase procedures are managed by solicitors on both sides. 

Except for the deposit/reservation fee, which is directly paid to the seller, all other funds are transferred from the buyer’s bank to the solicitor designated for the property. When the contract is set to be exchanged, funds are transferred from the buyer’s solicitor to the seller’s solicitor. 

Once the transaction is complete, your solicitor will register with the National Land Agency on your behalf, and you can verify the registration results online.

What documents are required for purchasing a property in the UK?

You’ll need proof of identity, proof of address, proof of funds/mortgage offer and sources of funds.

What property purchase documents do I need to keep after buying a house?

  • Title Deed: This document proves your legal ownership of the property. It’s important for any future sale, remortgage, or equity release.
  • Purchase Agreement (and Seller’s Disclosures): This agreement outlines the terms and conditions of the sale and any disclosures made by the seller.
  • Home Inspection Report: This report details the condition of the home at the time of purchase, including any potential issues that were identified.
  • Buildings Insurance: This type of insurance covers the cost of repairing or rebuilding your home in the event of damage caused by certain perils, such as fire, flood, storm, or theft. It typically includes coverage for the structure of your home, permanent fixtures, and fittings such as baths, toilets, and fitted kitchens. Securing buildings insurance is not just a wise precaution but often a mortgage requirement.
  • Closing Disclosure: This document provides an itemized list of all the fees and costs associated with your home purchase.
  • Mortgage Documents: If you financed the property purchase, keep all documentation related to your mortgage agreement and payments.
  • Home Insurance Policy: Documentation of your home insurance policy is important for coverage verification and in case you need to make a claim.
  • Property Tax Receipts: Keep records of property taxes paid, as they may be deductible from your income tax depending on your jurisdiction.
  • Repair and Maintenance Records: Keeping a history of repairs and maintenance performed on the property can be valuable for warranty purposes and for future buyers.

Store these documents in a safe, secure location—ideally, in both physical and digital formats—to ensure they are preserved and easily accessible when needed.

Is it safe to transfer funds for a property purchase in the UK?

Yes, it is. The UK property market operates under stringent legal guidelines, and all transactions are managed by solicitors on both sides. Except for the deposit/ reservation fee, which is directly paid to the developer, all other funds are transferred from the buyer’s bank to the solicitor designated for the property.

Upon agreement of the contract exchange, funds are transferred from the buyer’s solicitor to the seller’s. After the transaction is complete, your solicitor will register with the National Land Agency on your behalf, and you can verify the registration results online.

How to prove the legality of funds for a property purchase in the UK?

UK solicitors must ensure their clients are not using profits from illegal activities like money laundering for real estate purchases. Therefore, they need to understand their clients and verify the legality of private buyers. Solicitors may ask about the source of funds for the property purchase. If needed, the home buyer also might have to provide proof of source of funds, including but not limited to:

  • Proof of salary income (provide at least one): work deposits (wages, bonuses); payroll or bonus slips; employer letter; if self-employed, provide company audited bank slip. 
  • Stock investment or portfolio (provide at least one): Certified investment or deposit certificate, contract, and cash certificate for investment account; bank slip showing investment amount; accountant letter. 
  • Property sale (provide at least one): Certified contract; intermediary letter certificate; solicitor’s letter.

In the UK home buying process, what are the duties of a solicitor? 

  1. Due Diligence: The solicitor investigates the property’s background, liaises with the seller’s legal team and relevant government bodies, and gathers essential information, ensuring the property meets all legal and environmental standards. They also assess potential risks such as upcoming developments that might impact the property’s value or environment.
  2. Review of Legal Documents: The solicitor scrutinizes the contract provided by the seller’s solicitor, making necessary amendments to safeguard the client’s interests.
  3. Reporting and Contract Submission: Post-investigation, the solicitor provides a comprehensive report detailing the property’s status and key contract terms. This report, which influences lending decisions, is presented for the client’s review and signature.
  4. Cost Breakdown: Additionally, the solicitor furnishes a detailed list outlining all associated costs, including down payments, legal fees, survey fees, and stamp duties.