Conditional exchange

sancahojo

Hi all
Our buyer’s have been waiting on searches for nearly 8 weeks now. They have word that these will be received by the 11th December but there is still a chance it will take longer. They and their solicitor have proposed that we conditionally exchange (pending searches being received and no issues). This works for us as we are buying a new build and are getting harassed to exchange and pay the deposit. In my mind there is minimal risk to this and I am of the view that I will accept this proposal. Suppose the only risk would be that the searches come back with something and then there would be difficulties. Does anyone of experience of this? Would you accept? We are based in Greenwich. Thanks all.

greatcrested

What does your own solicior advise, and, critically, are you using a solicitor recommended by the Developer?

sancahojo

greatcrested said:

What does your own solicior advise, and, critically, are you using a solicitor recommended by the Developer?

My solicitor has yet to reply - slow turnaround normally so thought I’d enquire here. No, independent to the developer!  

davidmcn

Do you mean your contract for your purchase will, in turn, also be conditional on your purchaser purifying the condition in their contract? If so then there's no real risk to you, but the question is whether the developer would accept you being entitled to pull out for that reason.

Sandtree

If you can make your exchange also conditional then its fine because either both are confirmed and it goes through or the condition isnt met and so both don’t.

If your developer isn’t willing to accept a conditional exchange then clearly the risk is much higher if either the searches are delayed further or there is an adverse result.  What would your plan B be if this were the case?

FinallyStoppedLurking

Sounds very risky and not sure how they would word that. 

Would indemnity insurance not be a better option?

eddddy

FinallyStoppedLurking said:

Sounds very risky and not sure how they would word that. 

Would indemnity insurance not be a better option?

You could say the OP wouldn't really care too much about how the conditions are worded - that's more an issue for the OP's buyer and the OP's seller (the developer).  And the OP's buyer's solicitor has suggested it, so I guess they have some wording in mind.

But I guess one 'straightforward' option would be to make it conditional on the searches being acceptable to the OP's buyer's mortgage lender (with indemnity insurance, if required).  But perhaps the OP's buyer wants more flexibility than that.

babyblade41

It's not something I would do , 

pinkteapot

As others have said, so long as your onward exchange is equally conditional that's fine. You really don't want to conditionally exchange with your buyer, but straight exchange for your onward purchase, or you could be forced to buy even if your buyer pulls out! 

Definitely take your solicitor's advice on this one. 

sancahojo

Thanks all

Thrugelmir

Difficult to imagine a developer accepting a conditional exchange.