Buying a commercial mortgage is a complex and time consuming process, every stage takes longer than a residential mortgage as there are many more factors to take into account. For this reason alone the most important thing to getting a commercial mortgage right is getting the right solicitor.
Consequently, finding an experienced, reliable and affordable property solicitor is an important part of the purchase process. A commercial property deal throws up many legal issues and so it is vital that you have the right team on board. Our guide will help you find the right property solicitor for you.
Red Tape: Make sure you get a solicitor who is under the umbrella of the Solicitors Regulatory Authority, those that are in the RSA are regulated and fully insured members. This is advantageous as you know they’re not a stereotypical shady solicitor, as they’re insured it means you as the client are protected during the mortgage process as well as having an official outlet for complaints through the RSA if you feel the need to take that route.
Location: A locally based solicitor is likely to know more about the property, the local area and any local searches that may be required. Whilst solicitors in other towns may be able to undertake the work for you, they may not boast the same level of local knowledge as a solicitor in your vicinity.
Cost: While you want someone local, that doesn’t mean to go for the lowest denominator, in other words the cheapest solicitor you can find. You will want someone you can trust and who will put the hours in to get the job done, and in most cases the cost reflects the quality. Talk to a number of firms and treat it as an interview to see what services they will offer during the process and pick the one that suits your requirements.
Depending on the complexity of the deal, legal costs are going to range from a the hundreds to thousands of pounds. Plus you can expect added/separate costs known as disbursements for things such as VAT or Local Authority Searches, so budget accordingly.
When you appoint a solicitor, they are obliged to provide you with a schedule of costs and an estimate for how much your specific transaction will be. So, make sure that you understand how a solicitor’s fees work and what you can expect to pay in total. Even large solicitors are prepared to discuss fees with you and so don’t be afraid to thrash out the issue of fees before you formally appoint a commercial property solicitor.
Experience is Key: As we touched on before, experience is key, not just in the local area and region, but as a solicitor in general. Many specialise in certain deals and areas so always ask what they have specialised in and about any extra qualifications they might have. On top of this, years as a solicitor, how many commercial mortgages have they done recently or in the past and ask if they are accredited with the Law Society.
If it’s a medium to large firm of solicitors, make sure you ask who you’ll be dealing with most of the time, will it be the less experienced junior partner or the guy running the show. When you meet the solicitor it could be the head of the firm/department who then will just assign the case out, so double check who you’re actually getting to avoid confusion down the line and that the service arrangements are clear for both parties.
The market is full of commercial property solicitors, and there are many commercial mortgage lenders to choose from, so choice is not a problem. This means that you have the luxury of being able to take your time and pick the right deal to suit you, but you can only achieve this by doing your research thoroughly.
Howard O’Gollegos writes for Just Commercial Mortgages the UK’s No1 site for the latest commercial mortgage rates and commercial property finance news.
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