Contract clause to reduce purchase price by stamp duty if sellers delay completion?

Peggster1979

How about waiting until the Budget on 3rd March to see if the rumoured 6 week SDLT extension is announced? That way you could exchange and set a completion date comfortably within the new timeframe. 

saajan_12

Dogdog said:

We had stated in new offer that we need exchange and completion to take place simultaneously on 24/03, or before.  - any reason you can't exchange sooner, with completion set at 24Mar if everything's ready your end? 
They initially said that their solicitor has told them that this isn't possible, and that exchange needs to be 2-3 weeks before completion.  When I pressed as to why, and stated I've bought and sold a property in recent years with exchange and completion at the same time - they ended up saying that they need to safeguard themselves in case they pay a deposit and set up a tenancy somewhere - and then we were to try to drop our offer at the last minute or pull out entirely - leaving them liable for deposit and tenancy having not sold their property.    - entirely reasonable, gap between exchange & completion has been the norm for ages with good reason, so people can commit to things eg removals, telecoms, notice / deposit for rentals.. Now with Covid, there might be cons to having a gap, but that doesn't mean there aren't pros. 

I suggested this was fair enough, and said that we can probably work something out then - but I said that we don't have any safeguard should we exchange and then they delay completion beyond the end of March (stamp duty deadline) - because they haven't found anywhere to rent yet.  Obviously then as we have exchanged, we are in a legally binding contract and cannot pull out without losing their deposit.   They can delay completion for weeks - and the only compensation we will get is a miniscule amount per day (BOE base rate (0.1%) plus law society standard rate (4%), so 4.1% total of purchase price pro rata per day = under £50 per day!..........whereas we will have to pay in the region of £10k extra in stamp duty!! - You would claim your costs as a result of their breach of contract, so not just the interest. Costs of removals / storage / hotel if incurred are pretty commonplace. I haven't seen case law either way, but I don't see how the increased SDLT isn't also an increased cost you could claim. 

My suggestion is that when my solicitor receives the new draft contracts, they add a clause that states exchange to occur ASAP - completion date of 24.03 set at latest - if this is delayed by any actions on the part of the sellers and their solicitors (and ultimately exchange does not occur by 31/03 at the latest - thus giving them a 5 working day "grace" or "buffer" then sale pauses - and automatically purchase price is reduced by the amount of stamp duty that then becomes due - meaning that we as buyers have the same outlay as the current agreed purchase price - with no stamp duty"
- Draft contracts are meaningless, the contract would only be binding when exchange occurs. So you wouldn't agree to exchange 'asap' as the agreement is the exchange. The completion date is part of the contract as standard. But you could add a clause to add a retention / reduction in the amount of the SDLT, which you will keep if the completion is delayed  and SDLT is incurred. 
Is this viable / straightforward to do?  Is there any alternative way of ensuring we are safeguarded?  I thought about getting the percentage for compensation in the contract amended up from 4.1% to a huge percentage close to 1000% which would mean the full stamp duty amount is due to us on 1st April, and each day thereafter?

As far as I can see - sellers solicitor/sellers should have no reason no to accept clauses like one of the above - IF they actually do fully intend to complete as they have agreed on by 24/03???

Yes, you could add a clause to reduce the purchase price or add a retention if SDLT is incurred, as a belt & braces approach (I think you could claim this anyway as your damages as a result of the seller's breach, but no harm in making it explicit). You'd need to check 
*Is your solicitor happy to add the clause and any costs to draft this?
*Is your mortgage lender happy to treat this as a recompense for costs, and not a reduction in the sale price (which may affect their mortgage offer). 
*Whether the vendor will agree
As to why they would refuse, they might be worried it genuinely will take them longer to find a rental and not want to take the risk of £10k. You can demand it or pull out, but then you'd be looking at starting again with viewing, so certainly have to pay the SDLT on an alternative property. 

Dogdog

saajan_12 said:

Dogdog said:

We had stated in new offer that we need exchange and completion to take place simultaneously on 24/03, or before.  - any reason you can't exchange sooner, with completion set at 24Mar if everything's ready your end? 
They initially said that their solicitor has told them that this isn't possible, and that exchange needs to be 2-3 weeks before completion.  When I pressed as to why, and stated I've bought and sold a property in recent years with exchange and completion at the same time - they ended up saying that they need to safeguard themselves in case they pay a deposit and set up a tenancy somewhere - and then we were to try to drop our offer at the last minute or pull out entirely - leaving them liable for deposit and tenancy having not sold their property.    - entirely reasonable, gap between exchange & completion has been the norm for ages with good reason, so people can commit to things eg removals, telecoms, notice / deposit for rentals.. Now with Covid, there might be cons to having a gap, but that doesn't mean there aren't pros. 

I suggested this was fair enough, and said that we can probably work something out then - but I said that we don't have any safeguard should we exchange and then they delay completion beyond the end of March (stamp duty deadline) - because they haven't found anywhere to rent yet.  Obviously then as we have exchanged, we are in a legally binding contract and cannot pull out without losing their deposit.   They can delay completion for weeks - and the only compensation we will get is a miniscule amount per day (BOE base rate (0.1%) plus law society standard rate (4%), so 4.1% total of purchase price pro rata per day = under £50 per day!..........whereas we will have to pay in the region of £10k extra in stamp duty!! - You would claim your costs as a result of their breach of contract, so not just the interest. Costs of removals / storage / hotel if incurred are pretty commonplace. I haven't seen case law either way, but I don't see how the increased SDLT isn't also an increased cost you could claim. 

My suggestion is that when my solicitor receives the new draft contracts, they add a clause that states exchange to occur ASAP - completion date of 24.03 set at latest - if this is delayed by any actions on the part of the sellers and their solicitors (and ultimately exchange does not occur by 31/03 at the latest - thus giving them a 5 working day "grace" or "buffer" then sale pauses - and automatically purchase price is reduced by the amount of stamp duty that then becomes due - meaning that we as buyers have the same outlay as the current agreed purchase price - with no stamp duty"
- Draft contracts are meaningless, the contract would only be binding when exchange occurs. So you wouldn't agree to exchange 'asap' as the agreement is the exchange. The completion date is part of the contract as standard. But you could add a clause to add a retention / reduction in the amount of the SDLT, which you will keep if the completion is delayed  and SDLT is incurred. 
Is this viable / straightforward to do?  Is there any alternative way of ensuring we are safeguarded?  I thought about getting the percentage for compensation in the contract amended up from 4.1% to a huge percentage close to 1000% which would mean the full stamp duty amount is due to us on 1st April, and each day thereafter?

As far as I can see - sellers solicitor/sellers should have no reason no to accept clauses like one of the above - IF they actually do fully intend to complete as they have agreed on by 24/03???

Yes, you could add a clause to reduce the purchase price or add a retention if SDLT is incurred, as a belt & braces approach (I think you could claim this anyway as your damages as a result of the seller's breach, but no harm in making it explicit). You'd need to check 
*Is your solicitor happy to add the clause and any costs to draft this?
*Is your mortgage lender happy to treat this as a recompense for costs, and not a reduction in the sale price (which may affect their mortgage offer). 
*Whether the vendor will agree
As to why they would refuse, they might be worried it genuinely will take them longer to find a rental and not want to take the risk of £10k. You can demand it or pull out, but then you'd be looking at starting again with viewing, so certainly have to pay the SDLT on an alternative property. 

Thank you.  This is clear.   
In terms of why they would refuse - possibly if they are genuinely worried it will take them longer to find a rental.......
Further info:
- They knew they were looking to sell - and so would have to move find somewhere to rent - in September, when they advertised the property.  Nothing has changed.
- They were never going to be in a chain, nor was I.  I sold my property and moved in to rented in December.  
- Initial offer accepted, sale agreed October.  I stated from outset that I wanted to complete ASAP, and that it must be done by end March at latest and that I wouldn't be paying stamp duty if this didn't happen......things have been dragged out and look where we are!   Not what I wanted, but I've been flexible.
- In Jan and Feb, I'm still getting this asked by the sellers "can we rent back off you for a few weeks"

If they were genuinely concerned about finding somewhere to rent - why not give themselves maximum "safeguarded" time to do so by pushing for a much earlier exchange - and then having 2-3 months between that and a March completion - rather than having the whole thing drag out for 6 months?  Just doesn't feel right.

Irishpearce26

Dogdog said:
Thank you.  This is clear.   

In terms of why they would refuse - possibly if they are genuinely worried it will take them longer to find a rental.......
Further info:
- They knew they were looking to sell - and so would have to move find somewhere to rent - in September, when they advertised the property.  Nothing has changed.
- They were never going to be in a chain, nor was I.  I sold my property and moved in to rented in December.  
- Initial offer accepted, sale agreed October.  I stated from outset that I wanted to complete ASAP, and that it must be done by end March at latest and that I wouldn't be paying stamp duty if this didn't happen......things have been dragged out and look where we are!   Not what I wanted, but I've been flexible.
- In Jan and Feb, I'm still getting this asked by the sellers "can we rent back off you for a few weeks"

If they were genuinely concerned about finding somewhere to rent - why not give themselves maximum "safeguarded" time to do so by pushing for a much earlier exchange - and then having 2-3 months between that and a March completion - rather than having the whole thing drag out for 6 months?  Just doesn't feel right.

So are they moving into a rental because they are waiting for another purchase to go through or have they not started that process yet but know their house would sell in this climate?

They didn't want to exchange on completion so ask them to exchange this week and make it clear that this should give them ample time to find a rental. If not you could either threaten to pull out and see if that gets them moving or check to see if the SDLT will fall under the costs incurred within a breach of contract. This is a mixture of them not wanting to move twice but also ensuring they aren't too much out of pocket to accommodate your on budgetary deadline. Surely with 5 weeks to go this can be sorted in a way that suits all parties.

Dogdog

Irishpearce26 said:

Dogdog said:
Thank you.  This is clear.   

In terms of why they would refuse - possibly if they are genuinely worried it will take them longer to find a rental.......
Further info:
- They knew they were looking to sell - and so would have to move find somewhere to rent - in September, when they advertised the property.  Nothing has changed.
- They were never going to be in a chain, nor was I.  I sold my property and moved in to rented in December.  
- Initial offer accepted, sale agreed October.  I stated from outset that I wanted to complete ASAP, and that it must be done by end March at latest and that I wouldn't be paying stamp duty if this didn't happen......things have been dragged out and look where we are!   Not what I wanted, but I've been flexible.
- In Jan and Feb, I'm still getting this asked by the sellers "can we rent back off you for a few weeks"

If they were genuinely concerned about finding somewhere to rent - why not give themselves maximum "safeguarded" time to do so by pushing for a much earlier exchange - and then having 2-3 months between that and a March completion - rather than having the whole thing drag out for 6 months?  Just doesn't feel right.

So are they moving into a rental because they are waiting for another purchase to go through or have they not started that process yet but know their house would sell in this climate?

They didn't want to exchange on completion so ask them to exchange this week and make it clear that this should give them ample time to find a rental. If not you could either threaten to pull out and see if that gets them moving or check to see if the SDLT will fall under the costs incurred within a breach of contract. This is a mixture of them not wanting to move twice but also ensuring they aren't too much out of pocket to accommodate your on budgetary deadline. Surely with 5 weeks to go this can be sorted in a way that suits all parties.

They are moving in to a rental full stop.  No further purchase will occur.  Feels like they haven't bargained on how hard it will be to "find the perfect rental" and as you say - now probably don't want to move twice - and so are trying to remain in the property whilst they wait to find it.  Stamp duty becoming payable is clearly an issue......which from the outset, 6 months ago I clearly stated I wouldn't be paying - and this was accepted, as 6 month to complete a relatively simple transaction with no chain either end shouldn't be an issue!
Looking pessimistically - worst possible assumption =  seems they want the best price they can get - which they've got, believe me with work that needs carrying out!.....but now they want to have the convenience and lack of effort to move twice even though they've been sale agreed for 6 months!) - and if that means me ending up paying stamp duty then.....so what eh?!

saajan_12

Dogdog said:

saajan_12 said:

Dogdog said:

We had stated in new offer that we need exchange and completion to take place simultaneously on 24/03, or before.  - any reason you can't exchange sooner, with completion set at 24Mar if everything's ready your end? 
They initially said that their solicitor has told them that this isn't possible, and that exchange needs to be 2-3 weeks before completion.  When I pressed as to why, and stated I've bought and sold a property in recent years with exchange and completion at the same time - they ended up saying that they need to safeguard themselves in case they pay a deposit and set up a tenancy somewhere - and then we were to try to drop our offer at the last minute or pull out entirely - leaving them liable for deposit and tenancy having not sold their property.    - entirely reasonable, gap between exchange & completion has been the norm for ages with good reason, so people can commit to things eg removals, telecoms, notice / deposit for rentals.. Now with Covid, there might be cons to having a gap, but that doesn't mean there aren't pros. 

I suggested this was fair enough, and said that we can probably work something out then - but I said that we don't have any safeguard should we exchange and then they delay completion beyond the end of March (stamp duty deadline) - because they haven't found anywhere to rent yet.  Obviously then as we have exchanged, we are in a legally binding contract and cannot pull out without losing their deposit.   They can delay completion for weeks - and the only compensation we will get is a miniscule amount per day (BOE base rate (0.1%) plus law society standard rate (4%), so 4.1% total of purchase price pro rata per day = under £50 per day!..........whereas we will have to pay in the region of £10k extra in stamp duty!! - You would claim your costs as a result of their breach of contract, so not just the interest. Costs of removals / storage / hotel if incurred are pretty commonplace. I haven't seen case law either way, but I don't see how the increased SDLT isn't also an increased cost you could claim. 

My suggestion is that when my solicitor receives the new draft contracts, they add a clause that states exchange to occur ASAP - completion date of 24.03 set at latest - if this is delayed by any actions on the part of the sellers and their solicitors (and ultimately exchange does not occur by 31/03 at the latest - thus giving them a 5 working day "grace" or "buffer" then sale pauses - and automatically purchase price is reduced by the amount of stamp duty that then becomes due - meaning that we as buyers have the same outlay as the current agreed purchase price - with no stamp duty"
- Draft contracts are meaningless, the contract would only be binding when exchange occurs. So you wouldn't agree to exchange 'asap' as the agreement is the exchange. The completion date is part of the contract as standard. But you could add a clause to add a retention / reduction in the amount of the SDLT, which you will keep if the completion is delayed  and SDLT is incurred. 
Is this viable / straightforward to do?  Is there any alternative way of ensuring we are safeguarded?  I thought about getting the percentage for compensation in the contract amended up from 4.1% to a huge percentage close to 1000% which would mean the full stamp duty amount is due to us on 1st April, and each day thereafter?

As far as I can see - sellers solicitor/sellers should have no reason no to accept clauses like one of the above - IF they actually do fully intend to complete as they have agreed on by 24/03???

Yes, you could add a clause to reduce the purchase price or add a retention if SDLT is incurred, as a belt & braces approach (I think you could claim this anyway as your damages as a result of the seller's breach, but no harm in making it explicit). You'd need to check 
*Is your solicitor happy to add the clause and any costs to draft this?
*Is your mortgage lender happy to treat this as a recompense for costs, and not a reduction in the sale price (which may affect their mortgage offer). 
*Whether the vendor will agree
As to why they would refuse, they might be worried it genuinely will take them longer to find a rental and not want to take the risk of £10k. You can demand it or pull out, but then you'd be looking at starting again with viewing, so certainly have to pay the SDLT on an alternative property. 

Thank you.  This is clear.   
In terms of why they would refuse - possibly if they are genuinely worried it will take them longer to find a rental.......
Further info:
- They knew they were looking to sell - and so would have to move find somewhere to rent - in September, when they advertised the property.  Nothing has changed.
- They were never going to be in a chain, nor was I.  I sold my property and moved in to rented in December.  
- Initial offer accepted, sale agreed October.  I stated from outset that I wanted to complete ASAP, and that it must be done by end March at latest and that I wouldn't be paying stamp duty if this didn't happen......things have been dragged out and look where we are!   Not what I wanted, but I've been flexible.
- In Jan and Feb, I'm still getting this asked by the sellers "can we rent back off you for a few weeks"

If they were genuinely concerned about finding somewhere to rent - why not give themselves maximum "safeguarded" time to do so by pushing for a much earlier exchange - and then having 2-3 months between that and a March completion - rather than having the whole thing drag out for 6 months?  Just doesn't feel right.

That's great, but you don't have to convince us, you have to convince them.. 
If they don't agree, you're still in the same place, regardless of who's "right". 

Any reason you can't exchange tomorrow, with completion in 4 weeks?

Dogdog

saajan_12 said:

Dogdog said:

saajan_12 said:

Dogdog said:

We had stated in new offer that we need exchange and completion to take place simultaneously on 24/03, or before.  - any reason you can't exchange sooner, with completion set at 24Mar if everything's ready your end? 
They initially said that their solicitor has told them that this isn't possible, and that exchange needs to be 2-3 weeks before completion.  When I pressed as to why, and stated I've bought and sold a property in recent years with exchange and completion at the same time - they ended up saying that they need to safeguard themselves in case they pay a deposit and set up a tenancy somewhere - and then we were to try to drop our offer at the last minute or pull out entirely - leaving them liable for deposit and tenancy having not sold their property.    - entirely reasonable, gap between exchange & completion has been the norm for ages with good reason, so people can commit to things eg removals, telecoms, notice / deposit for rentals.. Now with Covid, there might be cons to having a gap, but that doesn't mean there aren't pros. 

I suggested this was fair enough, and said that we can probably work something out then - but I said that we don't have any safeguard should we exchange and then they delay completion beyond the end of March (stamp duty deadline) - because they haven't found anywhere to rent yet.  Obviously then as we have exchanged, we are in a legally binding contract and cannot pull out without losing their deposit.   They can delay completion for weeks - and the only compensation we will get is a miniscule amount per day (BOE base rate (0.1%) plus law society standard rate (4%), so 4.1% total of purchase price pro rata per day = under £50 per day!..........whereas we will have to pay in the region of £10k extra in stamp duty!! - You would claim your costs as a result of their breach of contract, so not just the interest. Costs of removals / storage / hotel if incurred are pretty commonplace. I haven't seen case law either way, but I don't see how the increased SDLT isn't also an increased cost you could claim. 

My suggestion is that when my solicitor receives the new draft contracts, they add a clause that states exchange to occur ASAP - completion date of 24.03 set at latest - if this is delayed by any actions on the part of the sellers and their solicitors (and ultimately exchange does not occur by 31/03 at the latest - thus giving them a 5 working day "grace" or "buffer" then sale pauses - and automatically purchase price is reduced by the amount of stamp duty that then becomes due - meaning that we as buyers have the same outlay as the current agreed purchase price - with no stamp duty"
- Draft contracts are meaningless, the contract would only be binding when exchange occurs. So you wouldn't agree to exchange 'asap' as the agreement is the exchange. The completion date is part of the contract as standard. But you could add a clause to add a retention / reduction in the amount of the SDLT, which you will keep if the completion is delayed  and SDLT is incurred. 
Is this viable / straightforward to do?  Is there any alternative way of ensuring we are safeguarded?  I thought about getting the percentage for compensation in the contract amended up from 4.1% to a huge percentage close to 1000% which would mean the full stamp duty amount is due to us on 1st April, and each day thereafter?

As far as I can see - sellers solicitor/sellers should have no reason no to accept clauses like one of the above - IF they actually do fully intend to complete as they have agreed on by 24/03???

Yes, you could add a clause to reduce the purchase price or add a retention if SDLT is incurred, as a belt & braces approach (I think you could claim this anyway as your damages as a result of the seller's breach, but no harm in making it explicit). You'd need to check 
*Is your solicitor happy to add the clause and any costs to draft this?
*Is your mortgage lender happy to treat this as a recompense for costs, and not a reduction in the sale price (which may affect their mortgage offer). 
*Whether the vendor will agree
As to why they would refuse, they might be worried it genuinely will take them longer to find a rental and not want to take the risk of £10k. You can demand it or pull out, but then you'd be looking at starting again with viewing, so certainly have to pay the SDLT on an alternative property. 

Thank you.  This is clear.   
In terms of why they would refuse - possibly if they are genuinely worried it will take them longer to find a rental.......
Further info:
- They knew they were looking to sell - and so would have to move find somewhere to rent - in September, when they advertised the property.  Nothing has changed.
- They were never going to be in a chain, nor was I.  I sold my property and moved in to rented in December.  
- Initial offer accepted, sale agreed October.  I stated from outset that I wanted to complete ASAP, and that it must be done by end March at latest and that I wouldn't be paying stamp duty if this didn't happen......things have been dragged out and look where we are!   Not what I wanted, but I've been flexible.
- In Jan and Feb, I'm still getting this asked by the sellers "can we rent back off you for a few weeks"

If they were genuinely concerned about finding somewhere to rent - why not give themselves maximum "safeguarded" time to do so by pushing for a much earlier exchange - and then having 2-3 months between that and a March completion - rather than having the whole thing drag out for 6 months?  Just doesn't feel right.

That's great, but you don't have to convince us, you have to convince them.. 
If they don't agree, you're still in the same place, regardless of who's "right". 

Any reason you can't exchange tomorrow, with completion in 4 weeks?

I'm happy to exchange ASAP.  What I've been informed is their solicitor needs to send new version of draft contract to mine.  Then they need to get on an exchange.  As far as I'm aware everything else is in place!  All searches are done, I've sent written confirmation to my solicitor that on basis of new agreed purchase price any previously outstanding enquiries are satisfied and we are instructing them to proceed towards exchange.  I have my revised mortgage offer docs - and my advisor has confirmed my solicitor will receive a copy of these within days from the lender mortgage service centre.

So it's on the solicitors (mine and theirs) to get things done asap as far as I can see?

Thrugelmir

Dogdog said:

saajan_12 said:

Dogdog said:

saajan_12 said:

Dogdog said:

We had stated in new offer that we need exchange and completion to take place simultaneously on 24/03, or before.  - any reason you can't exchange sooner, with completion set at 24Mar if everything's ready your end? 
They initially said that their solicitor has told them that this isn't possible, and that exchange needs to be 2-3 weeks before completion.  When I pressed as to why, and stated I've bought and sold a property in recent years with exchange and completion at the same time - they ended up saying that they need to safeguard themselves in case they pay a deposit and set up a tenancy somewhere - and then we were to try to drop our offer at the last minute or pull out entirely - leaving them liable for deposit and tenancy having not sold their property.    - entirely reasonable, gap between exchange & completion has been the norm for ages with good reason, so people can commit to things eg removals, telecoms, notice / deposit for rentals.. Now with Covid, there might be cons to having a gap, but that doesn't mean there aren't pros. 

I suggested this was fair enough, and said that we can probably work something out then - but I said that we don't have any safeguard should we exchange and then they delay completion beyond the end of March (stamp duty deadline) - because they haven't found anywhere to rent yet.  Obviously then as we have exchanged, we are in a legally binding contract and cannot pull out without losing their deposit.   They can delay completion for weeks - and the only compensation we will get is a miniscule amount per day (BOE base rate (0.1%) plus law society standard rate (4%), so 4.1% total of purchase price pro rata per day = under £50 per day!..........whereas we will have to pay in the region of £10k extra in stamp duty!! - You would claim your costs as a result of their breach of contract, so not just the interest. Costs of removals / storage / hotel if incurred are pretty commonplace. I haven't seen case law either way, but I don't see how the increased SDLT isn't also an increased cost you could claim. 

My suggestion is that when my solicitor receives the new draft contracts, they add a clause that states exchange to occur ASAP - completion date of 24.03 set at latest - if this is delayed by any actions on the part of the sellers and their solicitors (and ultimately exchange does not occur by 31/03 at the latest - thus giving them a 5 working day "grace" or "buffer" then sale pauses - and automatically purchase price is reduced by the amount of stamp duty that then becomes due - meaning that we as buyers have the same outlay as the current agreed purchase price - with no stamp duty"
- Draft contracts are meaningless, the contract would only be binding when exchange occurs. So you wouldn't agree to exchange 'asap' as the agreement is the exchange. The completion date is part of the contract as standard. But you could add a clause to add a retention / reduction in the amount of the SDLT, which you will keep if the completion is delayed  and SDLT is incurred. 
Is this viable / straightforward to do?  Is there any alternative way of ensuring we are safeguarded?  I thought about getting the percentage for compensation in the contract amended up from 4.1% to a huge percentage close to 1000% which would mean the full stamp duty amount is due to us on 1st April, and each day thereafter?

As far as I can see - sellers solicitor/sellers should have no reason no to accept clauses like one of the above - IF they actually do fully intend to complete as they have agreed on by 24/03???

Yes, you could add a clause to reduce the purchase price or add a retention if SDLT is incurred, as a belt & braces approach (I think you could claim this anyway as your damages as a result of the seller's breach, but no harm in making it explicit). You'd need to check 
*Is your solicitor happy to add the clause and any costs to draft this?
*Is your mortgage lender happy to treat this as a recompense for costs, and not a reduction in the sale price (which may affect their mortgage offer). 
*Whether the vendor will agree
As to why they would refuse, they might be worried it genuinely will take them longer to find a rental and not want to take the risk of £10k. You can demand it or pull out, but then you'd be looking at starting again with viewing, so certainly have to pay the SDLT on an alternative property. 

Thank you.  This is clear.   
In terms of why they would refuse - possibly if they are genuinely worried it will take them longer to find a rental.......
Further info:
- They knew they were looking to sell - and so would have to move find somewhere to rent - in September, when they advertised the property.  Nothing has changed.
- They were never going to be in a chain, nor was I.  I sold my property and moved in to rented in December.  
- Initial offer accepted, sale agreed October.  I stated from outset that I wanted to complete ASAP, and that it must be done by end March at latest and that I wouldn't be paying stamp duty if this didn't happen......things have been dragged out and look where we are!   Not what I wanted, but I've been flexible.
- In Jan and Feb, I'm still getting this asked by the sellers "can we rent back off you for a few weeks"

If they were genuinely concerned about finding somewhere to rent - why not give themselves maximum "safeguarded" time to do so by pushing for a much earlier exchange - and then having 2-3 months between that and a March completion - rather than having the whole thing drag out for 6 months?  Just doesn't feel right.

That's great, but you don't have to convince us, you have to convince them.. 
If they don't agree, you're still in the same place, regardless of who's "right". 

Any reason you can't exchange tomorrow, with completion in 4 weeks?

So it's on the solicitors (mine and theirs) to get things done asap as far as I can see?

Have you provided your solicitor with the funds required? 

Dogdog

Thrugelmir said:

Dogdog said:

saajan_12 said:

Dogdog said:

saajan_12 said:

Dogdog said:

We had stated in new offer that we need exchange and completion to take place simultaneously on 24/03, or before.  - any reason you can't exchange sooner, with completion set at 24Mar if everything's ready your end? 
They initially said that their solicitor has told them that this isn't possible, and that exchange needs to be 2-3 weeks before completion.  When I pressed as to why, and stated I've bought and sold a property in recent years with exchange and completion at the same time - they ended up saying that they need to safeguard themselves in case they pay a deposit and set up a tenancy somewhere - and then we were to try to drop our offer at the last minute or pull out entirely - leaving them liable for deposit and tenancy having not sold their property.    - entirely reasonable, gap between exchange & completion has been the norm for ages with good reason, so people can commit to things eg removals, telecoms, notice / deposit for rentals.. Now with Covid, there might be cons to having a gap, but that doesn't mean there aren't pros. 

I suggested this was fair enough, and said that we can probably work something out then - but I said that we don't have any safeguard should we exchange and then they delay completion beyond the end of March (stamp duty deadline) - because they haven't found anywhere to rent yet.  Obviously then as we have exchanged, we are in a legally binding contract and cannot pull out without losing their deposit.   They can delay completion for weeks - and the only compensation we will get is a miniscule amount per day (BOE base rate (0.1%) plus law society standard rate (4%), so 4.1% total of purchase price pro rata per day = under £50 per day!..........whereas we will have to pay in the region of £10k extra in stamp duty!! - You would claim your costs as a result of their breach of contract, so not just the interest. Costs of removals / storage / hotel if incurred are pretty commonplace. I haven't seen case law either way, but I don't see how the increased SDLT isn't also an increased cost you could claim. 

My suggestion is that when my solicitor receives the new draft contracts, they add a clause that states exchange to occur ASAP - completion date of 24.03 set at latest - if this is delayed by any actions on the part of the sellers and their solicitors (and ultimately exchange does not occur by 31/03 at the latest - thus giving them a 5 working day "grace" or "buffer" then sale pauses - and automatically purchase price is reduced by the amount of stamp duty that then becomes due - meaning that we as buyers have the same outlay as the current agreed purchase price - with no stamp duty"
- Draft contracts are meaningless, the contract would only be binding when exchange occurs. So you wouldn't agree to exchange 'asap' as the agreement is the exchange. The completion date is part of the contract as standard. But you could add a clause to add a retention / reduction in the amount of the SDLT, which you will keep if the completion is delayed  and SDLT is incurred. 
Is this viable / straightforward to do?  Is there any alternative way of ensuring we are safeguarded?  I thought about getting the percentage for compensation in the contract amended up from 4.1% to a huge percentage close to 1000% which would mean the full stamp duty amount is due to us on 1st April, and each day thereafter?

As far as I can see - sellers solicitor/sellers should have no reason no to accept clauses like one of the above - IF they actually do fully intend to complete as they have agreed on by 24/03???

Yes, you could add a clause to reduce the purchase price or add a retention if SDLT is incurred, as a belt & braces approach (I think you could claim this anyway as your damages as a result of the seller's breach, but no harm in making it explicit). You'd need to check 
*Is your solicitor happy to add the clause and any costs to draft this?
*Is your mortgage lender happy to treat this as a recompense for costs, and not a reduction in the sale price (which may affect their mortgage offer). 
*Whether the vendor will agree
As to why they would refuse, they might be worried it genuinely will take them longer to find a rental and not want to take the risk of £10k. You can demand it or pull out, but then you'd be looking at starting again with viewing, so certainly have to pay the SDLT on an alternative property. 

Thank you.  This is clear.   
In terms of why they would refuse - possibly if they are genuinely worried it will take them longer to find a rental.......
Further info:
- They knew they were looking to sell - and so would have to move find somewhere to rent - in September, when they advertised the property.  Nothing has changed.
- They were never going to be in a chain, nor was I.  I sold my property and moved in to rented in December.  
- Initial offer accepted, sale agreed October.  I stated from outset that I wanted to complete ASAP, and that it must be done by end March at latest and that I wouldn't be paying stamp duty if this didn't happen......things have been dragged out and look where we are!   Not what I wanted, but I've been flexible.
- In Jan and Feb, I'm still getting this asked by the sellers "can we rent back off you for a few weeks"

If they were genuinely concerned about finding somewhere to rent - why not give themselves maximum "safeguarded" time to do so by pushing for a much earlier exchange - and then having 2-3 months between that and a March completion - rather than having the whole thing drag out for 6 months?  Just doesn't feel right.

That's great, but you don't have to convince us, you have to convince them.. 
If they don't agree, you're still in the same place, regardless of who's "right". 

Any reason you can't exchange tomorrow, with completion in 4 weeks?

So it's on the solicitors (mine and theirs) to get things done asap as far as I can see?

Have you provided your solicitor with the funds required? 

Not yet - haven't been asked for it.  I'd send it now if I could actually get in touch with my solicitor and confirm to do this!

caprikid1

"Not yet - haven't been asked for it.  I'd send it now if I could actually get in touch with my solicitor and confirm to do this!"
So who is holding up the process ? Seems like both sides to me.