The 1st step when selling your home is to instruct an estate agent to act for you. They will deal with arranging the EPC, marketing, arranging viewings and informing you of offers that are placed.
The offer that you receive will be subject to legal work, survey and searches. There cannot be a legally binding verbal contract to buy a house. Therefore until exchange of contracts there is no binding contract between you and the buyer and they are free to withdraw from the transaction at any time if for example they discover something wrong with the property or their circumstances change. This applies equally to you and your ability to withdraw.
You should look once you have had your home valued to seek financial advice from either your bank or a financial advisor to establish how much you can spend on your new home. Steps Estate Agents offer free independent financial advice (please contact Paul Meredith 0208 593 5933) You should also check with your current mortgage lender whether any redemption penalties apply to you.
You should look to arrange a solicitor as soon as possible who will take details of your mortgage lender and request title deeds in order to prepare a contract package which will be sent to your buyer’s solicitor. As soon as you accept an offer the solicitors will receive a memorandum of sale drawn up by your estate agent.
Your solicitor can then write to the other parties involved to confirm their involvement. As soon as your title deeds arrive your solicitor will be able to prepare a draft contract package. Office copy entries are obtained which will show the up to date position with regard to your property, any mortgages, loans, rights of way etc registered against it.
The property information forms are then sent to the buyer’s solicitor who will take some time to check through the information that has been sent, they will also need to apply for local authority searches and report to their client.
At this stage the buyer’s solicitor will ask questions (additional enquiries) about the property or the draft contract. These questions should be able to be answered by referring to the information initially requested or if not further queries will be asked to you.
Contracts are supplied to the buyer in duplicate and at this stage they will return one copy for you to sign. On exchange of contracts, the two contracts are ‘exchanged’ hence the term.
As you approach exchange of contracts, you should agree a convenient date with your buyer and, if appropriate, with the rest of the chain, to complete the transaction ie. A moving date.
Completion must take place on a weekday. Also there needs to be a minimum of a weeks notice to ensure that the mortgage lenders have adequate notice to obtain funds.
You will sign your part of the contract before exchange and it will be held on your solicitors file until everyone in the chain is ready to exchange and you have given authority to proceed.
When contracts are exchanged, then the contract will be binding upon you and the buyer and thus neither of you can withdraw without incurring financial penalties. On the day of completion you should aim to vacate by 12noon the latest. Meanwhile your solicitor will receive the balance of the sale monies by telegraphic transfer and will inform you by telephone when this has happened.
It is normally best to leave your keys with your estate agent who will release them to your buyer only when it has been confirmed that funds have been received.
Your solicitor will then administer the sale proceeds according to the completion statement provided earlier. The main deductions will be to repay your old mortgage, their account and the estate agents account. The balance of monies due to you can either be sent to you by cheque or telegraphic transfer. There is a bank charge for telegraphic transfer but the funds will be available as cleared funds the same day.
Your solicitor will send the signed transfer and title deeds to the buyer’s solicitor as soon as they receive the completion monies.
For further information also see our Buying a Home Guide.
