Local searches vs Indemnity Insurance

livalicious

Good evening!

We are FTBs in the process of purchasing a house and the solicitor sent us a letter today stating the following:

"...I have received the HIP from your sellers and note that the searches are more than 6 months old and therefore I would strongly recommend that we obtain an update local search to ensure that there have been no adverse entries revealed since the date of the last year. The cost of the local search will be £130.72 and our legal fees are £99.50 + VAT.

Alternatively you may wish to obtain Indemnity Insurance at a cost of £40.80 and our legal fees are £30.00 + VAT. Such insurance should cover you for the reduction in the market value of the property as a result of any subsequent entries being revealed on a local search which would have an adverse impact. I enclose a draft copy of the policy for your information...."

Could someone please be so kind as to explain the difference between the two and should the lender accept the Indemnity Insurance, if this is a good idea to do rather than the searches? The sellers done their HIP in May 2009.

Thanks

timmyt

your lawyers should be fired. they won't be a 'solicitor' I can be certian of that with such tricks but you are paying solicitor rates.

they should not charge to carry out a local search...and £100 no less....their clients ae suckers.....bad bad bad. and neither for taking out indemnity isnurance.

do they want your work? if not then you'll go elsewhere.

the difference is that the local search can actually tell you if there are any adverse entries affecting the value and desirability of the property, whereas insurance will only throw money at you if any should come to light....you may get that dreaded knock on the door syndrome. Go with a fresh search, as there is effectively no search now in place if over 6 months. I do not even give clients a choice, as indemnity for an old search is really bolting after the horse has fled.

but fire that lawyer, they have no business doing conveyancing

livalicious

Hi timmyt, thanks for your response... but wait for it.... they online conveyancers too! :eek:

I was made aware that I would have to pay for searches and legal fees if required. Their fixed fee was quite low and I already factored that in anyway. Not excusing their practise, but I used them before for a purchase that fell through years ago, and I was happy with their service. As they say you pays your money, you takes your chances.

As for the searches, I understand it would be better to do the searches again, but what are the chances or likelihood of something adverse showing up 8 months after the first search, is this a common thing? Sorry for my ignorance, you dont know till you ask