Exchanging contacts

MF2015

Our buyer is pushing to exchange contracts but our contract isn't ready to exchange on our onward purchase and our solicitor said that's it's not possible to exchange contracts without a completion date set.

As we don't have a completion date for our onward purchase we can't give this and the solicitor has said once the completion date is set it can't be changed.

This doesn't sound right to me.

Is it possible to exchange contracts on our sale without giving a completion date? 

MaryNB

No. Completion date is set at exchange of contracts. 

Tiglet2

As above.  Your onward purchase is not ready, therefore you are not in a position to exchange and set the completion date.  Your buyers (FTB?) are in a chain and need to wait for all the links to be ready before proceeding to exchange.  

lookstraightahead

Tiglet2 said:

As above.  Your onward purchase is not ready, therefore you are not in a position to exchange and set the completion date.  Your buyers (FTB?) are in a chain and need to wait for all the links to be ready before proceeding to exchange.  

Unless they don't want to wait - is it a long delay op or just a few days 

firebubble

It's not strictly true, but I can understand why your solicitor is saying this.

Under standard contractual terms, the completion date is set around three weeks after exchange, but in the contract the parties can agree something different (eg change/completion on the same day). Once the contract has been exchanged, the date can be changed but both parties have to agree. You haven't said how long your chain is, but effectively it's not the agreement of two parties (you and your buyer), it's the agreement of the entire chain (unless you're happy to be homeless with your possessions until your onward purchase completes). Given the complexity of getting the agreement of the entire chain to a change of date, most residential solicitors wouldn't even offer it as an option, and this is why your solicitor has said it can't be changed once set.

I believe you can exchange without a date, and there is a mechanism where one party can serve notice after a set period of time to complete - but this isn't used for chains because (a) the money to complete is usually coming from a bank, rather than the purchaser, so there are a number of steps to complete in order to get the money which might not happen in time and (b) it would mean that the seller would be homeless if their onward purchase didn't complete/the buyer would lose their deposit if they couldn't complete at the end of the notice period.

The best thing to do is to chase the EA of the house you are purchasing to try and find out what the delay is, and then to inform your buyer via your EA, so everyone has clear communication.

If you can move out and it wouldn't affect the timing of your purchase (eg you would be staying with a friend rather than entering into a tenancy with a notice period to bring it to an end), then potentially you could uncouple your sale from the onward chain and then you could exchange and complete with your buyer, but presumably that's not a option.

MF2015

Thanks all. There are 3 in the chain.

Our buyer living with her daughter, she's already completed.

Us.


New-build with a completion date of 10th of October.

Our buyer is pushing to complete by the end of September as are we but it looks like there's an issue with the front door of the new-build we are buying. It could be sooner than the 10th but the builder has given that date to be safe. The house is complete but can't be signed off until the door is changed.

If we exchange on both houses then we would be happy to stay with family for a few days but our buyer won't be pleased about the proposed date of the 10th even though we could complete on our sale before then.

We wouldn't exchange on our sale until we have exchanged on our onward purchase as we have been caught out before doing this resulting in us been homeless after our seller pulled out a few days before exchange and completion. 

kirtondm

Youre buyer is unlikely to pull out if Oct 10th is a definite. If the new build wants to exchange with no fixed completion date that might cause more problems.

Tiglet2

OK, it sounds as though you could separate the sale from the purchase in order that your buyer completes before the end of the stamp duty deadline of 30th September (I'm assuming that's what this is about), you stay with family until the new build is ready to move into on 10th October or thereabouts.  

Ideally exchange on both transactions, one with a fixed completion date (your sale) and the purchase either agreed on 10th October or completion on notice.

MF2015

Thanks all. Well make sure we can exchange on both transactions and secure our school place but it looks like splitting it up is an option. 

macman

If you were to exchange without a completion date, then neither party would be bound to ever complete...