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Selling Your Home - The Legal Process

Once you have accepted an offer on your property from the proposed buyer, you will need to contact us with your instructions and let us have details of the deal you have agreed.

Once the offer has been accepted, the Estate Agent will send to us Sales Particulars identifying the parties in the transaction, the legal representatives, the agreed price and any other special conditions agreed in the deal. Once you have nominated us to act, we will send to you our Terms and Conditions and the property questionnaires for you to complete and return to us. These questionnaires deal with information relevant to the property and the fixtures, fittings and contents that are included in the sale.

As your Solicitors, it is our job to prepare the Contract setting out the terms of the sale.  To do this, we will need to obtain copies of your registered title from the Land Registry, or, if the property is unregistered, we will need your Title Deeds.  If you have your deeds, we will ask you deliver them to us.  We will also need to make arrangements to discharge your mortgage, if you have one, so we will be asking you for the name/address of your present Mortgage Lender together with the Mortgage Account Number.  This will enable us to apply for any deeds the Lender may be holding (although Lenders rarely hold deeds nowadays) and to obtain details at the outset of the amount that needs to be repaid.

When we have the official copies of your title or your Title Deeds and you have returned to us the completed questionnaires, we will prepare a draft Contract and submit this with the supporting documentation to the Buyer's solicitors. It is therefore important that you let us have documentation relating to your property as quickly as possible including any guarantees you have for work carried out; any planning permission or building regulations approval; any certificates or other relevant documentation that would be relevant to an owner of the property. We will also send the contract to you to sign at this stage with a brief explanation of its terms.

When this has been done it is then a question of waiting until the following occur :-

  • your Buyer has completed their financial arrangements;
  • the Buyer's Solicitors have dealt with the approval of the Contract;
  • the Buyer's Solicitors have obtained satisfactory Search results; and
  • the Buyer's Solicitors raise any additional enquiries and we have addressed these.

When your Buyer is ready to proceed, their Solicitors will arrange for the Contract to be signed.  The fact that the Purchaser has signed the Contract has no legal significance.  It is only when Contracts are EXCHANGED that you and your Buyer are legally bound to complete the transaction.

The Buyer's Solicitor will also send us a draft Transfer Deed for approval. This is the document required to transfer the ownership of the property from you to your Buyer on completion and which must be registered at the Land Registry. Once we have an approved Transfer, we will contact you to sign it. It is very important that we have the Transfer Deed signed by you no later than the completion date otherwise the transaction may be delayed.

Before Contracts are exchanged, it is necessary to agree a completion date.  This date is the latest date upon which you must move out of your property.  It is also the date upon which the Buyer is entitled to take up possession of the property.  Once this date has been agreed it will be incorporated in the terms of the Contract.

We are usually approached by the Buyer's Solicitors with confirmation that the Buyer has signed their contract and paid a deposit.  The deposit is normally equal to 10% of the purchase price but where a Buyer is obtaining a Mortgage of more than 90% of the purchase price a lesser deposit is sometimes offered. 

Unless a timetable has been agreed at the outset, the Buyer's Solicitors will usually suggest a completion date when they have all of their documentation in place and can obtain funds from their mortgage lender.   

We shall discuss with you the proposed completion date and if the proposals are to your satisfaction we shall then proceed to exchange of Contracts.  When we inform you that Contracts are exchanged this means that the agreement is legally binding.  If either party thereafter changes their mind they will be in breach of Contract and may be responsible for losses sustained by the other party as well penalty interest and additional legal costs.

Completion takes place at our office when the Buyer's Solicitors pay the balance of the purchase money into our Client Account.  In return, we will release the keys at the Estate Agents or, if you are handing them over direct, notify you that completion has now taken place. We will also arrange to forward the Transfer Deed and any Title Deeds to the Buyer's Solicitors to conclude the completion process.

Prior to completion we will discuss with you your moving arrangements and we can decide whether it will be better for you to hand in the keys to the Estate Agent or whether you would prefer to hand over the keys to the Buyer direct once completion has taken place.

On the day of completion, once all monies are received, we will pay off your existing Mortgage (if applicable) and as soon as possible thereafter, account to you for the balance of sale proceeds. 

Important Considerations In a Sale Transaction:-

The Chain:

Where there are numerous buyers and sellers in the chain, it can sometimes be difficult to secure a completion date in the early stages as each transaction may be progressing at a different speed or may have some aspects to resolve which may cause delay. Likewise, some party to the chain may need to fix a deadline which, if not met, means they can't proceed with the transaction. Factors in the chain can lead to delays or a requirement to speed things up or meet a deadline. We will do our best to let you know should such factors arise and do what we can to ensure that we meet any deadlines imposed or keep you advised as to reasons for delays.

Similarly, where there is a lengthy chain, completion can take a while as money needs to move between each firm of solicitors acting for each party. This means that the last party in the chain may not get keys until very late in the afternoon.

Where there is a chain, contracts won't be exchanged until every party to the chain is ready to do so. To protect the transaction, when everyone is ready, contracts will be "released". This is a formal pre-exchange method of binding the parties in the chain to an exchange of contracts and to ensure that we don't end up with a situation where some of the parties in the chain are contractually bound and others are not.

Fixtures & Fittings:

Fixed items such as internal doors, baths, kitchen units etc are usually included within the sale price as they are integral to the property. However, Sellers sometimes wish to remove items and both parties should know exactly what is staying in the property and what is to be removed. The Schedule of Fixtures and Fittings will be attached to and form part of the sale contract so both parties should be sure that what is noted in the Schedule reflects what has been agreed between them. Any additional items to be bought should also be noted in the contract. Therefore, you should let us know if you have agreed to sell separately any items to the Buyer over and above the items set out in the Schedule.

Vacant Possession:

You must give vacant possession of the property on completion. A common misconception is that this simply means you need to move out but there is a little more to it than that. Under the terms of the contract vacant possession means that the property must be fit for immediate occupation by the Buyer. This means that all occupiers must have moved out, all furniture and other items not included in the sale including rubbish must be removed from the property and you may have to repair any damage caused to the property when carrying out removals.

Also under the contract, the latest time vacant possession should be given to the Buyer is 2pm on the day of completion. However, this time is often varied to an earlier time if there is a chain and we will let you know if this is the case.

Negative Equity:

This occurs where you owe more money to the lender(s) than you are able to sell your property for. To be able to complete, you will need to pay the balance and make up the shortfall. The transaction may be delayed if you are negotiating a reduced settlement figure with your lender or if you were not expecting there to be a shortfall. We obtain redemption or settlement figures at the beginning of the transaction and will send you copies so that you can review your budget from the outset. We will not exchange contracts until we know you have sufficient funds to complete and where necessary have paid them in to us.

Less than 10% Deposit:

The deposit paid by the Buyer on exchange of contracts is a form of protection for you in the event the Buyer is unable to complete for some reason on the completion date due to no fault of yours. If this happens and the Buyer is unable to complete within a fixed time (usually 10 working days from the date of a Notice to Complete), you will be entitled to keep the deposit and resell the property. However, if you accept less than 10% of the purchase price as a deposit, the contract enables you to request the balance up to 10% but this may be of little assistance if the Buyer simply doesn't have it.

Therefore, although you are entitled to accept a lesser sum or no deposit at all from the Buyer, you should consider this very carefully before doing so. If the Buyer can't complete, what they've paid by way of reduced deposit may be all you will realistically receive as "compensation" for their failure to complete.

Surveys:

If your Buyer is obtaining a mortgage, the mortgage lender will send their Valuer to the property. However, a Buyer may also wish to have a further survey carried out, often a Homebuyer's Survey. This is not something for you to worry about as a Buyer must ensure they have satisfied themselves as to the state and condition of the property.

You should however consider that in most cases, an offer to buy your property will have been made subject to survey and/or subject to contract which means that the Buyer can vary their offer should subsequent adverse information come to light.

Should a Buyer's survey reveal significant necessary repairs to the property, it is likely that the Buyer will approach you to negotiate a reduction in purchase price or a contribution from you towards repairs. This will be a matter for yourself as to what decisions you make in this regard taking into account the deal as previously agreed and its terms.

For expert advice and support when selling your property, contact our solicitors on 0191 5666 500 or complete our no obligation enquiry form.

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