News25th June 2017
What Happens Once The Sale Is Instructed
Selling a property can be a stressful experience because you’re just not sure what to expect…
This can especially be the case once you have an accepted an offer and instructed Solicitors to proceed with the conveyancing process.
Here at Hannells, we speak to hundreds of buyers and sellers on a weekly basis and there are many misconceptions about the process, how long it takes and what actually happens.
All of which, we’ll attempt to clear up in this article.
As they say, “knowledge is power” and armed with the information revealed in this article, you should find yourself in a much more prepared position with a far greater understanding of just what goes on after your agent has secured a price that you’re happy with or you’ve had an offer accepted on your dream home.
So first of all – the conveyancing process – and then we’ll end with some common misconceptions that we hear on a regular basis.
Just what goes on behind the scenes between your offer being accepted and receiving the call that legal completion has taken place?
Firstly, if you are going to put forward an offer on a property, it will play hugely in your favour if you have the required documents and information to hand.
Before an Estate Agent can take a property “off” the market and get the SOLD board up, they’ll need the following information:
- Proof of funds for your deposit (if you’re having a mortgage) or proof of cash
- Your agreement in principle/mortgage promise (if you’re have a mortgage)
- The details of the Solicitors/Conveyancing firm you’ll be using
- Identification for all buyers
It is worth bearing in mind that even if an offer has been accepted, until all of this information has been obtained the property will usually remain fully available.
This means that the longer you take to get your documents in, the more likely it is that another buyer may see the property and beat you to it – which happens.
Plus, if you can have all of this information ready before you make an offer, it will show the selling agent and their vendor just how serious you are and could be the difference between having your offer accepted or losing out to someone else.
So, to kick things off, once your offer has been accepted your agent will draft up a sales memorandum which contains the details of all parties involved in the sale/purchase and send that to the relevant Solicitors, seller and purchaser.
You should also directly contact the Solicitors you have chosen to proceed with for the property transaction and formally instruct them.
From this point onwards, the estate agent involved in the sale has very little control over what happens as most of the work is now taken over by the Solicitors or conveyancing firm.
As the seller, you will receive a pack of documents containing questions about the property and what fixtures and fittings you will be leaving.
It goes without saying that for either side, if you’re looking to exchange and complete as quickly as possible, it will stand you in good stead if you can complete and return forms as soon as possible as that can often be what holds a sale up.
At this time, the purchaser should speak to their mortgage broker and instruct them to proceed with applying for the mortgage for the property.
Once the Solicitors for the seller have received the property information, they will draft up the contracts for the purchase of the property. This is the legal document that is sent to the purchaser’s Solicitor.
As the purchaser, you should pay for searches as early as possible and instruct your solicitors to proceed with obtaining them. Searches can take a number of days to be returned as they have to be applied for from the local council.
The searches requested will vary depending on where your property is located but the most common ones are:
Local Authority Search
This will provide a perspective on a variety of issues ranging from planning permissions to conservation areas.
Water and Drainage
This will contain information on the sewers, drains, piping etc. and who is responsible for maintaining them.
This will inform you of whether there is any risk of flooding, landslip or subsidence and identifies whether the previous use of the land the property is built on creates an environmental risk.
Other less common searches that your Solicitor may advise you to undertake are:
Chancel Repair Liability
Once the searches have been received, the buyer’s solicitor will raise enquiries and send those to the vendor’s solicitor. These enquiries can take a bit of “back and forthing” so again, it is always wise to respond to enquiries as quickly as possible.
Enquiries are simply the buyer’s solicitor’s way of making sure that all is right with the property and flagging up any issues they see with the results of the searches.
If a mortgage is required, the lender will at this point instruct a survey on the property. The purpose of the survey is to make sure that they are making a sound investment and the property is worth the amount they will actually be lending.
After having visited the subject property, the surveyor will draft up a survey report, which is sent to the lender and then they decide whether or not they are prepared to lend the required amount.
If so, a mortgage offer will be issued and sent to both the purchaser and their solicitor.
If the lender decides that the property is not worth the amount they are going to lend on, the price will have to be negotiated between the buyer and seller or the property will be placed back on the market in the hopes of securing a new buyer.
Once the Solicitor has the mortgage offer, the searches are back and all enquiries have been answered, the buyer’s will be invited in to sign the contracts.
If there are any other properties involved in the chain, they will be checked at this point to make sure that they are all at the same stage.
Both sides will then liaise and agree a date for completion.
Again, in the interest of completing as soon as possible, it is advisable to pay the deposit for the property at this stage of the transaction.
Exchange will then take place once the deposit is with the buyer’s solicitor and a completion date will be set that everyone agrees with.
Once contracts have exchanged, it is only at this point that buyer and seller are both legally bound to the purchase/sale of the property.
On the agreed date of completion, the monies will be transferred in to the account of the seller’s Solicitor.
It is only once the money has hit the account that the keys for the property can be “released” to the buyers and the property is now legally theirs.
So, now that you hopefully have a better understanding of the process and what’s involved, let’s clear up a few misconceptions and frequently asked questions that we come across on a daily basis.
How Long Will It Take?
This is by far the most common question asked once the sale is instructed. The answer is, as long as it takes. There are a number of variables that can affect the time it takes including how many properties are involved in the chain, how the purchase is being funded etc.
The most sensible answer is that for most transactions where a mortgage is involved, you should expect a period of between 12 – 14 weeks to get to completion from the point of solicitors being instructed.
It is worth bearing in mind that the transaction can only proceed at the speed of the slowest Solicitor.
This means that if you are looking for a speedy transaction, it can often be worth using recommended solicitors, even if they cost slightly more.
Unfortunately, you won’t know that you’ve instructed a less than satisfactory solicitor with the sale or purchase of your property until it is too late.
When Can I Pick Up My Keys?
Probably one of the most frustrating things about completion day is not knowing when exactly you’ll be able to pick up the keys for your property.
Legal completion can only happen when the correct funds have been transferred into the relevant bank accounts and there lots of variables that can affect when this happens on the day – it is heavily reliant on the banking system and how efficiently it is working on the day.
Usually, as soon as completion occurs, the Solicitor will ring the estate agent and let them know.
The agent will then call both the buyer and seller to inform them and arrange for the keys to be collected.
Completions usually occur at around lunch time.
However, this is not always the case and unfortunately, it can be a waiting game.
This can be frustrating if you have removals vans waiting but until the money hits the account, there is nothing anybody can do.
How Early Can We Set Dates?
It is not uncommon for buyers and sellers to want to talk about exchange and completion dates early on.
Everybody can be made aware of a preferred date that can be worked towards, but nothing can be set in stone until later on in the process.
It is impossible for any dates to be seriously considered until all the solicitors involved in the chain have received all replies to enquiries, searches etc.
So there you have it.
Hopefully, with a more thorough understanding of what goes on once a sale has been instructed, you’ll have a much better idea of what to expect.
At Hannells, we understand just how crucial this part of the sales process is which is why each of our branches has their very own case handler.
The role of the case handler is to liaise between all parties involved in the chain to make sure that everything is happening when it should be and help to push things through as quickly as possible.
In fact, we’re often praised for the work of our case handlers who are not only extremely knowledgeable, but have often kept sales together and resolved problems where other agents may have not been able to do so.
We’re always on hand to help at Hannells so if you have any questions, please feel free to email them in to us at firstname.lastname@example.org and we’ll be happy to help.