What is a Solicitor’s Mortgage Report?
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Your solicitor will ‘report’ to you highlighting the main terms of your mortgage.
A solicitor’s mortgage report is a formal report provided by your solicitor about the mortgage product you have chosen to finance the purchase of your next home. Here, we explain what that report does cover, what it does not cover, and where the limit of your solicitor’s advice falls.
Let’s first of all refresh ourselves on some mortgage basic stuff…..
What is a Mortgage?
Let’s remind ourselves – a mortgage is a loan formally ‘secured’ against your property.
Who lends Mortgages?
In the UK, mortgages are usually provided by ‘high street lenders’ (banks and building societies) and some specialist mortgage lenders.
What if I fail to keep up the repayments on my Mortgage?
Fail to keep up the repayments on your mortgage and your lender can repossess your home, and sell it to recover the money they loaned you, plus all costs they incurred recovering the debt.
What is a Mortgage Broker?
A mortgage broker is a financial advisor who specialises in mortgages.
What is an Independent Mortgage Broker?
An independent mortgage broker has access to the whole mortgage market, as against a ‘tied’ advisor who will be working for one lender and so will only recommend the products offered by his employer.
When should I apply for a Mortgage?
You should apply for your mortgage before the conveyancing process starts.
How is my Solicitor involved in my Mortgage?
Your solicitor’s job is to look after the legal side of your move. However, your mortgage does form part of that process and so your solicitor will do two things for your lender (at which point they are formally ‘instructed’ by your lender as well as you. They will:-
- CERTIFY TITLE – this means they tell your lender formally that the legal title to the property is OK
- REGISTER THE MORTGAGE – when your solicitor registers you as the new owner(s) after completion, they will also register the mortgage (also known as the ‘legal charge’) at the same time. These are both registered at HM Land Registry
Does my Solicitor arrange the release of my Mortgage Money?
After your solicitor has formally certified the ‘title’ to your property (to the lender), the mortgage company will send the solicitor your mortgage money.
When will my Solicitor receive the Mortgage Money from my Lender?
Your Solicitor tells your lender on exchange of contracts when completion will take place. The mortgage money will then be sent to your solicitor (usually) the day before completion in ready for the big day.
Who sends the Mortgage Money to the Seller?
Your solicitor will send the mortgage money to the seller’s solicitor.
What will the Solicitors Report Cover?
Generally, your solicitors mortgage report will cover:-
- LIMIT OF ROLE – they are NOT giving financial advice ie about the suitability of your chosen mortgage for your particular circumstances
- KEEPING UP REPYAMENTS – your home is at risk if you do not keep up repayments
- JOINT & SEVERAL LIABILITY – joint borrowers are jointly and severally liable meaning each borrower remains on the hook for the whole amount even if the other disappears never to be seen again!
- EXPIRY DATE – the date at which the formal offer runs out!
- MORTGAGE TERM – the duration of your mortgage
- BUILDINGS INSURANCE – this is often a term of the mortgage and ore particularly that you are insured from exchange of contracts (not just completion)
- MORTGAGE DEED – they will get you to sign a mortgage deed which allow the solicitor to secure the mortgage at HM Land Registry
- MORTGAGE CONDITIONS – it is your responsibility to read each and every condition and be sure you understand it and are happy to be bound by it!
Your solicitor is NOT giving you ‘financial advice’!
What is the limit of my Solicitors role in my Mortgage?
Your solicitor is your legal advisor, and will NOT be giving you financial advice. So, they will NOT be responsible for ensuring that (for example) you can afford the repayments.
Is it my Solicitors responsibility to make sure I can afford my Mortgage?
No no no! It is your responsibility, and yours alone.
What is the term of my Mortgage?
This is the number of years during which it is to be repaid.
Does my Mortgage Offer remain valid indefinitely?
No, your mortgage offer will have an expiry date. It is for you to satisfy yourself that this is OK along with all other aspects of your mortgage offer. But, your solicitors report may highlight this.
What is a Certificate of Title?
A certificate of title is a prescribed notice that your solicitor sends to your lender before completion to confirm that the title to your property is sound.
When will my Solicitor give me my Mortgage Report?
Your solicitor will report to you on your mortgage before exchange of contracts.
When will my Solicitor send my Lender a Certificate of Title?
Your solicitor will send your lender a certificate of title shortly after exchange of contracts?
What does my Lender need from my Solicitor to release my Mortgage?
Your lender needs the Certificate of Title from your solicitor. They also need the mortgage valuation from the surveyor (which you and your lender will have organised – not your solicitor).
Need more information about Mortgage Reports?
If you have any questions about mortgage reports that this article does not cover, do check out the other content on our website. If you still need our help – do please reach out! Our team of expert property conveyancing solicitors are here to help.
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