Buying and selling (Scotland) – what’s the process.

kixxb

Firstly – I do have a solicitor in place so we’d obviouslybe taking their advice for any decision but I just want to get my head roundthe process without bothering him.


Our 3 bed house is currently on the market – first viewingtonight although the viewer has their own property to sell and it isn’t even onthe market yet so not our ideal viewer. We are buying a new build that won’t be ready until the end of this year– if not later.

Obviously, we can’t make any progress on the new build untilwe’ve sold our property – or at least had the missives signed. It is at this stage when the contracts havebeen exchanged that we can formally reserve our new home? Or do people wait until the formal exchangetaken place? I have read some horrorstories about people pulling out after the missives are signed and it beingcostly and difficult to then pursue this as we’d have to pay the legal costs? Ideally, we’d like to exchange quite quicklyto allow us to reserve our new property but at the same time, as our new homewon’t be ready for months, is it possible to accept an offer as long as themissives are concluded within say 4 to 6 weeks but agree a long time beforeexchanging the property with the flexibility to shorten this should our buyersell their home quickly i.e. offer today, sign missives by end of March andformally exchange property in October giving the buyer 8 months to sell their property– or is that not realistic?

Also, if for example,this viewer did make an offer, can we accept the offer but still keep the houseon the market pending the conclusion of the missives – I know many houses showas Sold STC but do you have to flag this or could you still market the propertyas fully available? As a buyer, I generallydiscount any Sold STC properties as I assume it’s pretty much a done deal.


I recognise that this is all ifs, buts and maybes but it would be good to get things straight in my head!

Pixie5740

Part of a potential buyers offer will include a proposed date of entry. I think that part of the missives includes the agreed date of entry so I don't think it's simple to go changing it after the missives have been signed. It's one of the good things about the Scottish system in my opinion as you don't then end up with these fragile, stressful chains that they have in England.

rpc

The date of entry will, as Pixie5740 says, be part of the offer. You can then conditionally accept with a proposed change of date which may or may not be accepted.

Once the missives are concluded, that's it. The house will be sold on the agreed date as far as 99.9% of transactions are concerned. If you want to change a binding contract, don't expect to get a free hand. Missives can be completed in hours/days but it is often a few weeks to allow mortgage paperwork to complete.

The two transactions (buying and selling) are, to all intents and purposes, separate. Set a long date on the sale if you need to, so that there is time for the purchase to be agreed. Small gaps between the two parts of the move are not at all uncommon.

8 months to date of entry would be a long time (we said 5 on our last move and were surprised when the sellers accepted without quibble).

Keeping the house fully on the market while doing the missives would be very bad form. Your solicitor will not be party to that and certainly will not entertain any attempt to gazump. It would be professional misconduct for the solicitor. https://www.lawscot.org.uk/rules-and-guidance/section-f/division-c-conveyancing/guidance/gazumping,-gazundering-and-closing-dates

weeg

An offer will include a price and a date of entry. Missives will usually be concluded within a couple of weeks. Once missives have been concluded you are legally obliged to sell the house to the buyer, or compensate them for all their costs. In Scotland people very, very rarely pull out once missives have been signed, as they would have to pay you compensation.

Basically, in Scotland, in you accept an offer it's almost a dead cert you will sell it to the person whose offer you have accepted, unless there are massive unforeseen issues. No buyer is going to wait 8 months to get entry.

http://www.adviceguide.org.uk/scotland/housing_s/housing_buying_and_selling_s/selling_a_home_scotland.htm

kixxb

Thanks all - the long entry date isn't an issue - we have other arrangements which means we could move out very quickly if the buyer prefers this.

So if we did accept an offer from someone who still has a property to sell - we are obviously looking for them to sign the missives quickly but their solicitor should be advising against this - so how does that work?


Re the gazumping - that is absolutely not what we'd be looking to do - it's more that I'd be worried about taking the house off the market for a period only for it to fall through and have lost all that time attracting more suitable buyers!

Pixie5740

In Scotland the processes of buying and selling property are separate. Generally speaking missives are concluded within a few weeks of an offer being accepted. I don't see why the buyer's solicitor would advise them against doing so.

Buying and selling in Scotland is really nothing like in England even though a few EA have said to me, "Oh good, your chain free, you're in a strong position." Sigh, they've been watching too much Location, Location, Location.

kixxb

Ha = I don't watch that any more - it made me too depressed watching people spending millions on their dream house in the country!!

Ok, that's good to know that both are separate - I had it in my head that a solicitor would advise against signing missives on a new home unless you had sold your existing property but obviously that's not the case.


In our situation though, the builder of the new development won't allow us to reserve our new home until we've sold our current property which is a bit of a pain especially when the house won't be ready until the end of this year giving us hopefully plenty of time to sell ours!

jennifernil

It is quite common here to buy before you sell, but also wise to have arranged a mortgage offer first. A solicitor would not normally let a client offer before having arranged mortgage funding.

If buyers already have a mortgage offer based on income etc, with the survey being immediately available, a firm offer can often be made quite quickly.

There is no reason not to accept an offer from someone who has still to sell their property, how they arrange their finances is up to them.

Once missives are exchanged that is binding, but up till then, either side can pull out, so missives should be exchanged ASAP.

Why will the builder not allow you to reserve a property before selling your current home? Seems unreasonable if it is to take so long for it to be ready!

kixxb

I think Jennifer it is probably due to the amount of interest they have in the properties - they are selling like hotcakes.

The did say that if we could demonstrate that we could afford the new property without selling our current home then they could take a reservation - which we probably could actually but would prefer to get our property sold first.


Luckily, the builder is keen to offer us their own easy move scheme so if we don't have any activity prior to the plot being released, they'll market our house for us and cover these costs which should hopefully help get things moving.

weeg

If a buyer makes an offer without selling first then that is their problem - not yours. It's for their solicitor to advise them on the wisdom of this, it's for yours to push to get missives concluded in a timely manner.

The flipside is, if they haven't yet sold and they put a long entry date on their offer it would work in your favour. But it's not your problem. If your solicitor is in any way worth dealing with, they'll be happy to talk you through all of this - better informed clients are easier to deal with!

kixxb

Thanks Weeg - I've not spoken to solicitor yet but will do so.

On another note, I've just realised that my home move budgeting spreadsheet has a major error - We'd previously been looking at houses in the £230 to £250k mark but now looking at one £270k + - I was still calculating stamp duty at 1% rather than 3% which has sort of blown our timescales a bit - oh well, just as well they are building a lot of new houses where we want to live!