Legal experts are warning that the rush to beat interest rate rises could lead to “ill conceived” and “rushed transactions.”
The Bank of England has increased interest rates for five consecutive months this year, hitting 1.25% last month.
That is pushing up mortgage pricing and prompting brokers to warn buyers to lock-in low rates while they can.
But lawyers from Adkirk Law have warned that rising interest rates must not mean rushed transactions.
Adkirk Law co-founder Linda Kirk and practice manager Kieran Egan have written a piece exclusively for Estate Agent Today where they warn of the perils of pushing a transaction through too fast.
They warn: “With interest rates climbing, prospective buyers are currently rushing to complete on deals before existing mortgage applications expire and they are forced to borrow on higher rates.
“Activity is currently on par with that of the stamp duty holiday and panicked buyers are making avoidable mistakes in the race to complete.”
Their piece highlights that prospective buyers are understandably becoming increasingly worried of being priced out of the market.
It said: “Combine this pressure with the lack of existing properties for sale and you have a perfect recipe for rushed, ill-conceived transactions.”
They warn that buyers shouldn’t rely on a mortgage survey and should arrange their own independent report early on.
The article said: “If clients act too late having their own property survey carried out, this cost then often comes in addition to the bank’s valuation, which can only escalate if further reports are recommended.
“There are a whole host of what these further reports may be: drain reports; roof reports; damp and timber reports; and gas and electricity certificates. The latter example can be a sticking point for buyers, who often do not understand the seller is only obligated to provide gas and electricity certificates for them if works have been carried out.”