Prior to Exchange of Contracts
- Prior to exchange of Contracts we request the ALCD from the Developers solicitor so that we can check the mortgage offer will be valid at the time of completion. If the ALCD is outside of the mortgage offer expiry date we will request a long stop date from the Developer’s solicitor to protect the client and lender.
- Deposit monies are requested from the client and the return of any signed documents which have not yet been received. We check that signatures on the signed documents match the signatures on the clients photographic ID evidence provided.
- We then put in place bankruptcy searches and an OS2 search at the Land Registry. An OS2 protects the clients/lenders interests in the plot for 30 days as no other party can submit an application to register in this time.
- An undertaking is sent to the Developers solicitors for any Help to Buy matters accompanied by a copy of the mortgage offer, valuation, signed undated HCA Equity Charge and pages 21 and 22 of the Help to Buy Solicitors Pack.
- A Money Laundering undertaking is also sent on all transactions to the Developers solicitors.
Exchange of Contracts
- Once contracts are ready to be exchanged we take the clients verbal authority. Contracts are usually exchanged with completion being on notice rather than a fixed legal completion date as often the plot is under construction.
- A memorandum of exchange is sent to the Developers solicitors along with the deposit via BACs bank transfer. If the matter is Help to Buy, a confirmation of exchange must also be sent to Orbit.
- The NHBC activation code and policy numbers are activated in respect of the 10 year NHBC warranty.
- Once the Developers can offer a fixed completion date, notice is served or a supplemental contract is exchanged in order to vary the Contrat to fix the legal completion date
Pre-completion deposit protection
- During the first two years after construction, the NHBC requires the builder to put right at this own expense any defects that arise as a result of the builder not adhering to the NHBC standards of materials and workmanship. Should the builder fail to attend to the repairs a complaint can be made to NHBC who can then require the builder to complete the work or can refer any dispute to arbitration.
- During the third to tenths years after construction, the NHBC insures the buyer against major damage due to any defect in the load bearing structure. Minor repairs such as shrinkage will not be covered. Subsidence will also not be covered as this will be covered by the buyer’s home insurance policy.
- The eight year NHBC insurance policy for physical damage to certain parts of the home caused by a failure to build to the NHBC Technical Requirements
- Protection for certain breaches of Building Regulations if NHBC Building Control Services Limited is appointed for and carries out building control for the property
- Pre-existing contamination on the land on which their home is built.
NHBC Warranty what’s not covered
There are some things that are not NHBC’s responsibility, such as, but not limited to:
- wear and tear, neglect and failure to undertake appropriate maintenance
- storms and other severe weather conditions
- fire and smoke
- damp, condensation and shrinkage which is not a result of the registered builder failing to meet the NHBC Technical Requirements
- theft or accidental damage (the homeowner should consider separate insurance for this).
