Are solicitors delaying because of COVID19 or because of another reason?

[Deleted User]

What's the definition of a small chain?

I would probably say less than 3 parties involved.  Any more than that starts to get annoying and lots of stuff that cant be controlled or influenced. 
sounds like you are in a small chain though

Drop the estate agent a note asking where the sellers are with their purchase.  when your local search comes back that will raise various questions that need answered (keep in mind that raising questions probably means a good week for answers to come back so this part can feel quite sluggish).  Things like missing certificates for electrics or stuff along those lines.  Occasionally they come back and no further questions come up.    
Then you are pretty much on the home run, deal with money laundering checks if you havent done so already (one tip here is to try get the purchase solicitor to liase with the remortgage solicitor directly, makes the source of funds checks so much easier.  ignore that bit if your btl remortgage has already completed). 

So;

1. local search comes back
2. enquiries raised off the back of it
3. any residual questions raised and answered
4. report sent to you - check all this and raise anything you arent happy with or need further clarification on
5. funds in place
6. exchange/complete

Thrugelmir

jumperabv3 said:

Densol said:

The trouble is the new normal for some may not be the new normal for others. My personal opinion is many businesses will not get through this and sadly many people will lose their jobs. I think the banks will be more wary of lending. For many landlords this will be the nail in the coffin for them after all the tax changes and they will be selling off properties. 

I dont want to pay £330k for somethinv that may be priced less next year. I dont need the BTL now - its a 5 year investment model for my son to have when he is 25 ( 20 now ) so Im just waiting, watching and seeing how we come out at the other end. Just have to wait and see 

The UK has cut the interest rate to 0.1% which is super low, that is only going to fuel investors because mortgages would be cheap ... 

There's many BTL property investors who are going to find themselves somewhat exposed as this crisis unfolds. Reliance on property as an income stream may prove a costly error of judgement. Leveraging with debt is double edged. Far from a one way bet. 

jumperabv3

Thrugelmir said:

There's many BTL property investors who are going to find themselves somewhat exposed as this crisis unfolds. Reliance on property as an income stream may prove a costly error of judgement. Leveraging with debt is double edged. Far from a one way bet. 

I agree with you many BTL investos are going to be in troubles ... when it comes to BTL location is the most important thing, that's why the moto is "location location location" - this comes before anything else.
In Reading where I want to invest I find it very hard to see prices falling, the prices there are quite undervalued if you ask me, since Reading is slowly becoming "part of London", the Cross Rail (Elizabeth Line) would change a lot in a few year time, it's so difficult and hard to see it because of what we're going through right now but I am not looking at this as a one year investment, this is not a fixed deposit, this is something I'm willing to do for 20-30 years if not more.

That's what I did with my 1st BTL in London in 2012, thank god it was a very good decision, the property price has gone up in value by 50% and the rent has already paid 30%-35% of the property price so far, no rent arrears thankfully... 

You still need a bit of luck on your side with all this but I believe in doing the maximum from your end. Now please forgive me if I won't be able to participate until tomorrow night, so I won't be able to view/respond to further comments, but bottom line I am not in disagreement with you - for some it would be a nightmare, BTL investment is something you have to look into from so many angles before jumping on the wagon.

jumperabv3

Deleted_User said:

What's the definition of a small chain?

I would probably say less than 3 parties involved.  Any more than that starts to get annoying and lots of stuff that cant be controlled or influenced. 
sounds like you are in a small chain though

Drop the estate agent a note asking where the sellers are with their purchase.  when your local search comes back that will raise various questions that need answered (keep in mind that raising questions probably means a good week for answers to come back so this part can feel quite sluggish).  Things like missing certificates for electrics or stuff along those lines.  Occasionally they come back and no further questions come up.    
Then you are pretty much on the home run, deal with money laundering checks if you havent done so already (one tip here is to try get the purchase solicitor to liase with the remortgage solicitor directly, makes the source of funds checks so much easier.  ignore that bit if your btl remortgage has already completed). 

So;

1. local search comes back
2. enquiries raised off the back of it
3. any residual questions raised and answered
4. report sent to you - check all this and raise anything you arent happy with or need further clarification on
5. funds in place
6. exchange/complete

I dropped an email, not expecting any response today coz' it's a bank holiday but thanks so much for all the details you provided, this is very helpful.
Can I ask based on your experience, and your estimate of how things shall move now - just a very rough guess - how long do you expect it should take from now, approximately?
Thanks!
PS yes remortgage already completed so I already passed that part.

Slithery

Average time from a complete chain to completion is 3 months in normal times, I'd expect around 5-6 months at the moment.

Windofchange

Slithery said:

Average time from a complete chain to completion is 3 months in normal times, I'd expect round 5-6 months at the moment.

I think this is probably a fair comment. We had our offer accepted January 31st, and have now had everything completed and are ready to exchange contracts. It's all gone very quiet though, and it just seems like the other two in the chain aren't able or willing to progress at present. Our mortgage offer will run out June 30th, so I am expecting it to go to the wire as long as nobody drops out of course. I guess until the restrictions are lifted then large swathes of property chains are going nowhere. I'm more than happy to move now as we are renting, so worst case is we exchange contracts and then pay rent and mortgage for a month whilst we slowly move all our things over one car load at a time. The house we are buying is about a mile from our current rental property. We don't. have a huge amount of stuff - two or three transit vans worth maybe. I guess for the others in our chain clearing out a 4 bed house and then a 5 bed house for her sellers it may be more of a task, and they will need a removals company. Just wish we knew a date, even if it was June 30th, but just something that we had set in stone as to when we could get going. 

jumperabv3

Slithery said:

Average time from a complete chain to completion is 3 months in normal times, I'd expect around 5-6 months at the moment.

What is the main reason it takes 3 months in normal times? Is it the residual inquiries JAM74 mentioned in step #3 among the 6 steps he listed?

AdrianC

jumperabv3 said:

Slithery said:

Average time from a complete chain to completion is 3 months in normal times, I'd expect around 5-6 months at the moment.

What is the main reason it takes 3 months in normal times? Is it the residual inquiries JAM74 mentioned in step #3 among the 6 steps he listed?

Because there's a lot of information has to be collated.

The seller takes their time filling in the various lists and bits of paperwork.
The seller's solicitor collates that into the draft contract, and sends it to the buyer's solicitor.
The buyer's solicitor raises his eyebrows, and asks various questions of the seller's solicitor.
The seller's solicitor asks the seller, who takes their time replying. This may repeat.

The buyer's solicitor does all the searches, including from any freeholder or management company. They take time to come back. There may be queries.

The buyer's solicitor should go through everything with the buyer, ideally face-to-face, especially things like LR plans. Again, there may be queries.

In the meantime, the buyer gets their survey done, and the finance in place. Again, there may be issues.

Finally, the buyer is happy they're buying what they thought they're buying. The buyer's solicitor is happy all the legal ducks are lined up. The money's available. And... exchange, then complete!

jumperabv3

AdrianC said:

In the meantime, the buyer gets their survey done, and the finance in place. Again, there may be issues.

If the buyer already has finance in place, no need to have survey etc. - would it make things a bit shorter in "normal" times? i.e. instead of 3 months it would take X months or X weeks? Sorry for asking so many questions.

Tiglet2

Finance and surveys are two separate matters.

If you have cash or are getting a mortgage from a lender then that is the finance covered (lender will do a valuation survey) plus deposit, that's one cog in the wheel.  Instructing a surveyor to do a Home Buyer's Survey or Full Structural Survey for your peace of mind is something you can decide to do or not, depending on whether you consider spending a few hundred pounds essential on, say, an approx £300k purchase.  That's another cog in the wheel.

While you are sorting out the above finance/survey, your solicitor will be collating all the information and making enquiries.  So, no, it would make no difference to the time it takes, since generally mortgage applications and surveys are normally in place during the early stages of the transaction and the enquiry stage takes place during the middle stages and can take quite some time.  Sometimes additional enquiries are made about issues raised in the survey too, as clients often want to ask more questions of the seller.