- Real Estate
Sell Your House | A Step by Step Guide Including Inheritance Tax
A Complete Guide To Selling Your House
Sell my House - Inheritance Tax
Do you ever get the feeling that you think you know it all, but then you find out that you know diddly squat? Yes? good, it's not just me then. Let me explain, Recently my brother inherited my late aunts house, which he has been living in with her for the past fifteen years. When she passed away, we, in all innocence thought that he would be able to stay there, no problems, no interference, nothing, peaceful. Yeah right.
The vultures descended, the crows started circling and that deep mysterious thing called the government suddenly raised its rather scary head. Obviously we knew that he would have to deal with the deeds and probate, of course that was by the by, but then those two horrible words suddenly emerged. Inheritance Tax. Now the trouble was, I had heard about it of course, but it never dawned on me that it would in any way be relevant to me and my brother. Stupid I know, but as I said at the beginning, I thought I knew it all. After nearly two years of hiding under the proverbial blanket, we realised that however nice the government were being, they wouldn't let us off indefinitely. So, in July this year we started the only thing we could do. Sell My House and give loads of money to the government!
20,000 thousand pounds had to be paid. This was a huge amount of money to us, and if it all went wrong my brother would end up living in a tent on the edge of the motorway!
How To Sell Your House
We made the phone call to the Estate Agent
The estate agent came round the same afternoon, and took a few details about the house, how many bedrooms, looked around the front room, mumbled and took notes, then made a suggestion about how much the selling price would be, He also told us about how much percentage he would be taking for his fee, in this case it was 1% of the sold price.
If there were any questions, he answered then to the best of his ability. We were aware that a photographer would come around at some stage to take photo's of the property, but at that point we were not sure when.
This was at three o clock. At five o clock my brother phoned me and hissed down the phone, "There's somebody peering in the window" i said what? He said, There's somebody peering in... I said, I heard you, what I meant was, Why? I think it may be someone come to look at the house. I said, no It can't be, its too early. Not only had we not seen the photographer outside, but by five o clock it was already on the Internet. It was unbelievable. Like a giant wave, we were swept into the current, and we felt like we had lost control.
So be prepared for it to take off very, very quickly. Over the next two weeks we had at approximately six couples coming to see the house. You can either stay in and see them yourself, or you can leave a key with the estate agent and he or she can show them around. It's entirely up to you.
We chose to let the estate agent do it.
Coming to terms with it.
The one thing that nobody ever talks about is the emotional side to selling your house. Especially if it is one that has been inherited. Losing someone is a hard thing to do. The feelings that you have at the time of their passing is bad enough, but when you come to terms with it you don't realise just how much comfort you get from the fact that you are still living or visiting the house where they lived, worked, and joked with you. Also, remembering them taking you out when you children. The smells of the house, from the cooking to the smell of their perfume that has permeated the house and still does even now, two years on, is part of the fabric of your life. The walls envelope you like giant arms and when you feel low, the familiarity is comforting. I feel as I walk around the house, that she is just in the other room. it comforts me. I don't think that the government take this into consideration when then drop a whacking great bill on you for inheritance tax. But enough of that.
When you have found a buyer, the estate agent will ring you and tell you about them and say what the are willing to offer. Be prepared to expect quite a large drop from what you have asked for. This is just standard. But don't let it drop too much. You have got to find another house for yourself, and you shouldn't have to lower your standards just to please them. Stick to your guns, there will always be another offer, if you have a good estate agent, they will always keep you informed about what is happening, from the big things to the little.
If you are happy with the price that is offered, the first thing you must do is get yourself a solicitor, and inform your estate agent of their name and address. He or she will then instruct you solicitor about the sale.
How not to get confused
Your solicitor will send you a client care letter which you then sign and send back, then come the forms. Oh my! Forms about fixtures and fittings, forms about property, Building work, guarantees, building consents, etc so on and so forth! All to be filled out and signed, then sent back to your solicitor.
Hidden cost alert
Imagine my surprise when I realised that we had to pay 150 pounds for this bit! We were exhausted from the mental strain of filling in all these forms and we had to pay for the privilege! So be careful and make sure you keep some extra money for a rainy day. Because it had just poured! This price can be negotiated if you are on low income. It's not just well off people who sell their house, sometimes you have no choice.
Also, around this time, a surveyor will come out to assess your property. In our case, it was also being done because the buyer wanted to extend the building. We are also having a structural engineer round for the same reason. This will be paid after the sale.
After two weeks, not a lot has happened yet. My brother and I have been frequent visitors to the solicitor, and to her credit, she hasn't got fed up with us quite yet! After taking back all the forms that we had to fill in, we found that there was always little niggles that seem to seep into our minds. Usually at three in the morning.
The main one being, how do we pay the inheritance tax? We were not sure whether the solicitor dealt with it or should we send it to the Tax office, after the sale has gone through.
What we weren't aware of was that every time you need to see a solicitor, you may have to make an appointment to see a different one concerning a separate problem. For example, if you are selling your house, you would see one who deals with the house and property and things to do with the home. Another in the same firm of solicitors will deal with inheritance tax. and so on.
So we made an appointment to see the relevant solicitor, and then I received a phone call from them stating that actually we didn't need one at all! Evidently, as long as the probate has been dealt with and the Government inheritance tax office is aware that you are selling your house, you should be able to pay them after the sale. But you must have a solicitor involved in the house sale, so that they can just give the tax office a ring to confirm this. Obviously this is to make sure that you don't sell the house, grab the money and scarper to a tax free haven abroad!
Ah, I wish.
Now we can concentrate on looking for a new home for my brother. There is one more very important thing that you must do to make sure that there is no misunderstanding between buyer and seller.
Help Sell your House by kmbctv
Read the small print and check the contracts.
If you are planning to sell your house and move quickly, then the normal contracts apply, but if, like my brother, you wish to take your time for any reason, especially if it is out of your control, make sure the solicitor puts everything you say down in the contracts. Just one sentence could ruin your plans.
I am lucky, I know the buyer very well, and she has told us that my brother can stay there until February, as she is in no hurry to move in, as there is quite extensive work to be done on the house. But in the great wide world of gobbledegook laws and regulations, even though we know her, it is in her rights to ask my brother for rent, once the contracts have been signed.
But there is another way that is still legal and binding. And that is, to stop any misunderstanding, my brother can hold the deeds, until he decides to move out within that time span. The house will in all effectiveness be hers, but he will still pay house insurance, electric and gas. Also any other bill. If the deeds are signed over to her, in effect from that moment on it will be her house, and her bills. And he would be her lodger. So please be very careful about how you word everything, and think, think, think again. Watch every letter, word and phrase, because just one word can make a difference to the contracts. Be very careful.
One thing that was puzzling us, and that was the fact that the estate agents started to talk about Stamp Duty.
We in all our innocence, had never heard about this. So you can imagine our horror when we realised that, not only would he have to pay Inheritance tax on his house that he was selling, but he would also have to find another eight thousand pounds for the privilege of buying another house! Evidently anything up to two hundred and fifty thousand pounds, you have to find one percent Stamp duty, over that it went straight up to three percent.
Another Hidden Cost Alert!
.Now my brother is buying another place to live, we now have to find another one hundred and fifty pounds to start the process off again! Even though it is the same solicitor, and estate agent, and even though they still are asking for a huge amount at the end of the sale, we still have to cough up this money. The trouble is, if you cannot find it straight away, it means you will hold up the whole process. It seems to me that it costs more to sell your house than to keep it and live on the money that you seem to be throwing away! As my brother put it, He feels like he is in the middle of a great ocean, floating away on a small piece of driftwood, and he can see the shore but it is still a long way away.
Still, next week we sign the agreement contract so at least that is one more bit out of the way.
We have a new problem. The lease on the property that my brother is buying, has to be renewed in December, the solicitor is saying, Don't Buy It! evidently it is to much trouble. For one thing, if he wants to sell it later on, he will find it very difficult, secondly the lease holder may put the price of the lease up by thousands! Please, please, please check how long your lease is on your new property before you buy.
We eventually worked out the lease problem. And the end of the day, it was down to my brother. Did he want to risk it with a short lease? Or buy the extra? Well, he said, and I quote: ' I am never moving again, so what the heck is the problem?'!
So now it is nearly a year later, and he is settled in nicely. What started as a nightmare is now a lovely peaceful haven for him to keep warm, and be comfortable in. And that, at the end of the day is the most important thing.
So, If you have to Sell Your House please read all the stages properly, if you miss anything, you may find yourself with hidden costs.
Selling your house is not easy, but if each stage is handled correctly, you should be able to do it with only a bit of stress.
The one thing that I must reiterate is, make sure that you have at least 500 pounds, or dollars in the bank before you start. Otherwise you will find that these hidden costs will hold up the whole process. And that's the last thing you want when you move house.
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