scottish property system

ediblecastle

Hi there,

I'm in the process of noting interest in a property and will be making an offer asap.

I've read online that the scottish system works like this:
• Parties make formal notes of interest
• Once enough have been noted, a closing date is set
• Interested parties each submit a blind bid to the seller
• On closing day, the bids are revealed and the seller decide who (if any) to sell the property to.

The seller told me today that they had received two offers already and knew the amounts and yet a closing date had yet to be set but would be happening soon.

Is anything about the above steps incorrect? Is this just a basic model that can deviate case-by-case?

Everyone who I talk to (house owners, who have bought and sold previously) also don't think that the buyers are only limited to 1 bid. Yet my solicitor and research say otherwise. 1 bid per buyer. Which also seems weird to me.

If anyone could set me straight, that'd be great.

Beancounter

1 bid per buyer for a closing date yes. If no closing date then you can make as many offers as you like.

It is possible that a seller could have received several offers then decide to go to closing. The people already offering would have to submit a new offer which would remain sealed until closing day.

ediblecastle

Ah! There we go. You're the first person out of all these finance consultants, mortgage advisors and solicitors who's just told me, straight up, what the deal is. Thanks man!

davidmcn

Beancounter wrote: »

The people already offering would have to submit a new offer which would remain sealed until closing day.

These days nothing is actually "sealed" - offers are emailed or faxed immediately before the deadline.

ellie27

You do not need to put in a note of interest. If you see a house you like you can make an offer on it yourself, or get your solicitor to put in the offer for you.

All the possible interested buyers could put in as many offers as they want just now and if its enough then the seller can accept.

The offers already received might be nowhere near what they are hoping for, but by setting a closing date makes everyone feel the need to put their very max offer in.

Best of luck!

agrinnall

You really need to be guided by your solicitor, particularly in a case like this one where it sounds like the traditional closing date system will be used (quite unusual these days, in many locations there aren't enough buyers to warrant it, are you buying in Edinburgh or one of the few other property hot spots in Scotland?).

ediblecastle

Yes, buying in Edinburgh. Most of the properties I've been looking at in the last few weeks have been going to closing dates.

googler

ediblecastle wrote: »

I've read online that the scottish system works like this:

• Parties make formal notes of interest
• Once enough have been noted, a closing date is set
• Interested parties each submit a blind bid to the seller
• On closing day, the bids are revealed and the seller decide who (if any) to sell the property to.

The seller told me today that they had received two offers already and knew the amounts and yet a closing date had yet to be set but would be happening soon.

Is anything about the above steps incorrect? Is this just a basic model that can deviate case-by-case?

Everyone who I talk to (house owners, who have bought and sold previously) also don't think that the buyers are only limited to 1 bid. Yet my solicitor and research say otherwise. 1 bid per buyer. Which also seems weird to me.

If anyone could set me straight, that'd be great.

Notes of interest are an informal arrangement, a courtesy between solicitors and agents. There's no legal obligation contained in them, though the law society has guidelines on how solicitors should implement them.

There's no obligation on a seller to declare a closing date. They can accept any offer they want, at any time.

If a closing date is declared, buying solicitors will try to wait to the last minute to see how many other notes are in place before submitting offers by fax or e-mail.

If the seller tells you there are two offers as yet unaccepted, you should get your solicitor to quiz the selling solicitor or agent to confirm this.

You can make an offer, and if you find out later there are more notes of interest, you can revise your offer.

ediblecastle

We've been very proactive in viewing the property apart from actually making an offer (seeing a solicitor today about that).

The owners seem keen on letting us make an offer before deciding on which party's bid to accept.

I say this because the last time we met, they said that one of the offers they'd received was a bit of a game changer. And if it was a game changer... (which surely means a significant amount over the evaluation price) why not just accept right there and then?

My new question is- legally, they can just tell us the amounts that have been offered to them at the moment, right? A closing date has not been started and thus, no 'sealed bids' have been sent.

I'm not sure THEY (just like me) really understand the system either. What's allowed and what isn't. I think solicitors just really like taking control and not telling clients how things actually work.

davidmcn

ediblecastle wrote: »

And if it was a game changer... (which surely means a significant amount over the evaluation price) why not just accept right there and then?

Because they'll probably get even more if they allow everyone to bid against each other at a closing date.

legally, they can just tell us the amounts that have been offered to them at the moment, right?

Yes, if they want to. But it won't necessarily be in their interest to do so.

I think solicitors just really like taking control and not telling clients how things actually work.

I think we generally do tell clients how things actually work, but sometimes we have to get past lots of misinformation spread by other people.

ediblecastle

Yeah, I probably jumped the gun on that last comment. It's just proving to be a steeper learning curve than I originally thought.

How might it not be in their interest to tell me the exact values that have been offered?

They're hoping that I don't just bid a small amount over the current highest bid? But rather- because of the uncertainty, bid a larger amount over?