Buying and selling a property is something that many of us do at some time in our lives, and for most of us it’s the biggest transaction we will ever make. However, for something so common, the process often feels complicated, full of jargon and terms we don’t really understand. To demystify the process, we’ll explain the key stages that follow an offer, along with practical steps to keep your sale on track. Whether you’re buying or selling, understanding all the aspects of a sale will help you to keep calm and carry on moving!
Step 1: The Offer
After a viewing, a keen buyer can make an offer via the seller’s estate agent, and that could be the asking price, or lower. The agent conveys this to their client and lets the potential buyer know their response.
If you’re the seller, after placing your property on the market with an estate agent, you can sit back and wait for the offers to come rolling in! Your agent will let you know when they have an offer from a buyer and advise and negotiate until you either accept or reject the offer.
Offer Accepted:
There is usually a ‘property chain’ involved. For example, the person buying your house will often be selling a house to someone else who may also be selling a property. Equally, if you are selling a house, you may be buying another one, and that person will be looking to go to a new property as well. The admin around this chain will be managed by the agents, and it is often the trickiest piece of the puzzle.
Although a frustrating part of the process, in the meantime, you can help keep the process moving by:
- Ensuring you have all your documents and financial information in place (securing a mortgage in principle if you need one, as well as having deposits and other funds in place).
- Proactively communicating with your solicitor, estate agent, and mortgage broker as things unfold.
- Responding to any communications and questions from other parties promptly.
Step 2: Instructing a Solicitor
Although not a legal requirement, all agents recommend instructing a solicitor as soon as an offer is accepted. In some cases, mortgage lenders require that you have a solicitor to manage all the legal aspects of your property transaction. Personal recommendations from friends are always a good place to start, and often your estate agent will be able to recommend someone locally.
If you are the buyer, your solicitor will:
- Conduct property searches and ensure the property’s title is clear, making sure there are no potential disputes that may occur.
- Review the contracts.
- Manage the transfer of funds – this includes ensuring legal fees and stamp duty are paid.
- Liaise with the seller’s solicitor.
If you are the seller, your solicitor will:
- Review legal contracts and liaise with the buyer’s solicitor.
- Manage the exchange of funds including deposits – this includes ensuring legal fees and stamp duty are paid.
- Keep you informed about the progress of the sale.
- Oversee the exchange of contracts and completion of the sale to make sure everything is done properly.
- Liaise with the lender to ensure all financial arrangements are in place.
- Arrange the transfer of deeds to the buyer.
- Ensure the sale proceeds are transferred to you.
Will I need a surveyor?
Surveyors are professionals who act on behalf of a buyer, inspecting the prospective property to make sure there aren’t any major problems which may impact the sale. That includes looking both inside and out, checking for structural issues, damp, subsidence or infestation, alterations to the property that didn’t have planning permission, or any damage which may require imminent repairs.
While there’s no obligation to have a survey carried out, it’s highly recommended to help identify any issues. Sometimes these can impact the value of the property – if the roof or chimney stack needs replacing, for example. Or if there are more serious problems, like subsidence, it can have an impact on whether a bank will lend against the house.
It is up to the buyer whether they choose to have a survey done, and the cost ranges from £300 to £1500 depending on which level you choose.
- Level 1 is a Condition Report, which will look at the basic condition of the property to highlight serious issues.
- Level 2 is a Homebuyer Report, which is a more detailed survey including a valuation for insurance purposes.
- Level 3 is a Building Survey, which is the most thorough type of inspection, including a full structural assessment.
What does my mortgage provider need?
Once your offer has been accepted, a mortgage lender will commission their own valuation to make sure they feel that the house is worth the amount you are borrowing. This will be done by a qualified surveyor but is separate to your home survey.
Your mortgage lender will also conduct any final checks to determine affordability, making sure that you don’t have any new debts or changes to your income. Changes that can cause delays include:
- Down valuation: When the surveyor has a reason to think the property is worth less than the agreed price. This is usually the result of structural issues.
- Building survey issues: Such as subsidence, damp, and urgent repairs.
- Title issues: Where current ownership is not clear or there are unresolved legal issues relating to the property.
- Incomplete or inaccurate documentation: Information that’s missing and means that the valuation process can’t be completed.
- Changes to income: If the buyer’s income has gone down since the time that they applied for the mortgage, making it harder for them to afford repayments.
Will I need buildings insurance?
Buildings insurance needs to be in place from the date that you exchange contracts on your property and is also a condition of most mortgages. It insures the structure of your property against damage from issues like storm, fire, or flood. Typically, it will cover the roof, walls, windows and some permanent fixtures like kitchens and bathrooms, but it is separate from contents insurance.
Step 3: Exchange and completion
Exchanging contracts is where both the buyer and seller sign legal contracts committing to proceed with the sale. The buyer will pay the agreed deposit, and a completion date is set.
The typical amount of time between exchange and completion on a property is 1 – 3 weeks, but they can happen on the same day.
This final waiting period can be anxious time, but there’s plenty you can do to keep busy! So:
- Double check that your finances and insurances are in place.
- Set up plans for moving day.
- Notify your utility providers to set up services at your new address.
- Let the local council and others know about your change of address.
- Start packing!
On the day the sale completes, remaining funds are transferred from the buyer to the seller along with the legal ownership of the property. The buyer’s solicitor will handle the transfer of funds and notify the Land Registry about the transfer of property ownership. The estate agent will then be allowed to hand over the keys and everyone can celebrate a successful sale!
We’d love to help
There is a lot involved, but an experienced estate agent, like any of us here at Mustard, will guide you seamlessly through the process, making sure you know what to do at each stage. So, whether you’re buying or selling, or would just love to know what your home is worth, give us a call and we can get the ball rolling!
