Exchange of contracts - why does it take so long?

AubreyMac

I think the buying process is rubbish as there is no protection from financial loss if either party pulls out.

Why does it take so long?

pinkteapot

First step is getting a complete chain. I.e. a group of people who all want to sell and buy, starting with a FTB/cash buyer at the bottom and ending with the sale of a property with no onward chain. Nothing can happen until this is in place. It can take a week or months. I offer on a property. Those people then look for a house and make offers. Then their seller looks and makes offers. And so it goes on until someone decides to buy a no onward chain property or go into rented.

However, no-one in the chain should spend any money until this is all sorted. Sadly, a lot of people don't realise this and do instruct their solicitors and apply for their mortgage before the chain above them is in place. FTBs get an offer accepted then start doing everything, not thinking about the fact that their seller hasn't found anywhere to move to yet.

There's absolutely no point starting the process until the chain is in place as exchange and completion happen on the same date for everyone in the chain.

Once everyone is ready to go, the process typically takes 6-12 weeks.... Mortgage applications take a few weeks to be approved. Local searches that the solicitors request from the council typically have a 2-4 week turnaround time. Then there are all the forms and questionnaires about the houses going backwards and forwards between sellers and buyers.

But, it can take considerably longer if solicitors/surveyors find problems with the houses or if people are slow at filling in forms they're asked to.

Owain_Moneysaver

Move to Scotland.

G_M

Go to the library and borrow a book on house buying.

It will explain the process in detail.

movilogo

The time gives buyers reflection on whether to buy their dream properties or not

Houses are biggest purchases in lives - so there needs to be some time so that people don't purchase in haste and then regret their decision rest of their lives.

G_M

rue but that's not actually the reason for the timescale. It's more to do with completing due diligence.

kingstreet

In most transactions, things take longer because they are done consecutively, rather than concurrently.

You wait for the vendor to find somewhere and the chain to form; you apply for a mortgage and have a survey. You have your solicitor request searches.

Everything is geared towards expending the least amount of money until it's necessary. You get a green light for each section, before you move on.

Contrast this with newbuild. Reservation taken today. Solicitors instructed, mortgage application submitted ASAP and offered in about seven to ten days. Searches requested and back and contracts exchanged as close as possible to the 28 day target.

Here the objective is speed, not to minimise potentially wasted cost. It's the same with a repossession.

G_M

kingstreet wrote: »

Contrast this with newbuild. Reservation taken today. Solicitors instructed, mortgage application submitted ASAP and offered in about seven to ten days. Searches requested and back and contracts exchanged as close as possible to the 28 day target.

.... and then wait around 4 months for the construction to be completed..... :rotfl:

kingstreet

We're doing stuff expected to exchange by the end of February which won't complete until October...

Your jest was on the mild side of what's currently going down!

Owain_Moneysaver

kingstreet wrote: »

Contrast this with newbuild. Reservation taken today. Solicitors instructed, mortgage application submitted ASAP and offered in about seven to ten days. Searches requested and back and contracts exchanged as close as possible to the 28 day target.

My solicitor can do a conveyance on a ready built house in 3 weeks and that's not rushing it.

The problem is the English system.

Thrugelmir

Owain_Moneysaver wrote: »

The problem is the English system.

I've never found it a problem. Speed isn't everything.