LEGAL
A simple guide to staircasing
As shared ownership is an attractive and affordable option for first time buyers, providing a much-needed step on the property ladder, Coralie Phelan, Partner and Head of Resales and Staircasing at Prince Evans Solicitors, explains how you can increase your ownership by staircasing
WHAT IS STAIRCASING?
Second stage – arrange a valuation 9 Once it is established that the transaction is affordable you can then liaise with the housing association to arrange a valuation 9 You usually have 12 weeks to complete before the valuation expires Third stage – instruct a solicitor 9 Once the valuation has been arranged you should then instruct a conveyancer who specialises in staircasing such as Prince Evans Solicitors 9 The housing association’s solicitor will issue the draft memorandum of staircasing to your conveyancer Fourth stage – review the memorandum of staircasing The memorandum of staircasing is the document that records the purchase of the additional shares. 9 Your conveyancer will check the terms of the memorandum and then report to you regarding the terms and enclose the memorandum to sign 9 If you are remortgaging, your solicitor will also deal with the remortgage element and ensure all your lender’s requirements are met Fifth and final stage Once you have signed the documents your
Staircasing is the process of buying additional shares in a shared ownership property with a corresponding reduction in specified rent.You are basically purchasing more equity. There a number of advantages to staircasing as follows: 9 Most leases allow you to purchase 100% of your home 9 You may benefit from more mortgage choices as you are not limited to shared ownership products 9 It may be easier to sell the larger the percentage owned 9 You have increased security when you own more equity 9 You pay less rent 9 The greater the percentage owned, the more you benefit from any property price uplift HOW DO I START THE PROCESS? The first step in the process is to contact your landlord housing association and provide formal notice of your intention to staircase.You will need to arrange for an independent surveyor to visit the property and work out the current market value.You will receive a copy of the valuation and will be asked to confirm you want to proceed with the process. At this stage you will need to consider how you will be funding your staircasing. If you are remortgaging, you should now contact a mortgage adviser who will assist you in selecting the best mortgage product for you.
9 You might be required to pay SDLT 9 You might be required to cover your landlord’s legal and administrative fees WHAT ARE DIFFERENCES BETWEEN OLDER LEASES AND THE NEW HOUSING CORPORATION MODEL LEASE IN TERMS OF RIGHT TO STAIRCASE? A new 1% staircasing schedule has been introduced in new leases. Older model leases usually allow for staircasing in 10% increments. THE LEGAL PROCESS FOR STAIRCASING AT A GLANCE First stage – financial assessment 9 You may wish to consider staircasing when your current mortgage deal comes to an end 9 You will need to have your finances assessed to see if you can afford to purchase additional shares
solicitor can fix a completion date. 9 Your solicitor will then produce your final invoice for payment before completion
9 Your solicitor will then deal with the post completion requirements including registering the Memorandum at the Land Registry SUMMARY There are many advantages to staircasing including financial security. However, it is imperative you instruct a conveyancer specialising in this area to ensure you receive accurate advice. At Prince Evans Solicitors our expert team is happy to provide assistance or a quote. Do call us on 020 8567 3477 for a no-obligation quote
HOW MUCH DOES STAIRCASING COST?
You will need to pay for the following: 9 A valuation 9 Your own legal fees 9 Your mortgage arrangement and mortgage adviser’s fees
110 First Time Buyer October/November 2024
Made with FlippingBook Annual report maker