Ask The Expert: 'We're buying a leasehold flat. Why is our lawyer worried?'

Question: We are buying a leasehold flat and our solicitors seem more concerned about the requirements of our building society than our questions about the property. Why?

Answer: Although some lenders like to have their own solicitors, your lender has clearly instructed your solicitors to act for them as well. This is usually less expensive, but your solicitors have to ensure your interests and those of the lender are properly protected.

Your lender will have certain requirements which must be satisfied before your solicitors can submit a certificate of title to the lender requesting the mortgage funds.

The requirements of the lender are found in different places. Your solicitors will have received a copy of your mortgage offer and mortgage instructions from your lender. In addition, the Council of Mortgage Lenders and the Building Societies Association publish general instructions to which lenders adhere. Your lender is likely to be a member of one of these organisations and so your solicitors must ensure those instructions are satisfied in addition to the conditions in the mortgage instructions.

Your solicitor should, of course, deal with and answer all your queries relating to the flat, but I hope you can also see how important it is for your solicitors to be able to satisfy your lender – because if they don't you will not get your mortgage!

Question: I was told that it is not always necessary to pay a deposit when buying a residential property, but I've always paid 10 per cent. What is the correct position?

Answer: It is usual to pay a deposit on exchange of contracts when buying a property for the protection of the seller. If a buyer defaults after exchange of contracts then the seller has some leverage, as they can usually retain the deposit. But unless the contract provides for a deposit to be paid by the buyer, then no deposit is payable, as common law or statute does not provide for the payment of a deposit.

Most contracts for the sale of residential property are based on the Law Society standard conditions of sale. They provide for a deposit of 10 per cent of the purchase price.

Sometimes a buyer will ask to pay a deposit of less. It is up to the seller whether to accept a reduced deposit. But if the buyer fails to complete the transaction, the seller still has the right to sue them for the full 10 per cent deposit.

What's your problem?

If you have a question for Ask the Expert please email property@independent.co.uk. Fiona McNulty is a partner in the residential real estate team at Thrings LLP ( www.thrings.com)