Indemnity insurance for your sale and purchase.
As property lawyers there’s nothing better than acting for a seller or buyer whose property does not bring up any ‘issues.’ These ‘issues’ can arise from search results e.g. the environmental report carried out by a buyer comes back as adverse, the local authority search reveals the passageway to the rear of the property is private, or from a check of the deeds.
However, having a buyer’s solicitor write to us saying their searches or title investigations have thrown up ‘issues’ or checking search results and carrying out title investigations when we act for the buyer and finding such ‘issues’ isn’t always going to be a barrier to the sale or purchase going through. So when your property lawyer contacts you to say there’s an issue, remember there are ways round these things that don’t stop you from achieving your goal of buying or selling.
One of the ways of getting past any issues is by considering indemnity insurance. Most conveyancers are able to liaise with indemnity insurance providers because we live in an age where mortgage lenders can’t afford for things to be left to chance and are often quoted as requiring insurance in place when ‘issues’ crop up and before a transaction can proceed (there was very recently a situation where a lender asked for indemnity insurance because a plan contained in a lease was not edged in red despite the lease being registered at the land registry with absolute title).
There are certain things to remember if your property lawyer contacts you regarding moving your sale or purchase forward and utters the words ‘indemnity insurance’. If you are in this situation, consider the following:
• If your buyer has a mortgage lender, then in order for your sale to progress to exchange and completion, you may have to consider paying the one off fee for indemnity insurance.
• Bearing in mind the above it is important to remember you do not have to agree to pay for insurance. You can ask that the buyer pays for it. This could lead to the following scenarios: your buyer says no and possibly walks away, your buyer says no and you continue to say no and there’s a stalemate or the best scenario - your buyer could agree to pay for the indemnity insurance themselves.
It’s difficult to predict outcomes sometimes, but we work closely with our clients and solicitors representing the other party to help achieve our client’s goals. Any costs for the indemnity insurance and administrative charges involved should also be explained to you together with what the policy does and does not include.
For more information please contact Sharon Sangha at Lawson-West on 0116 212 1000.
