(Some advice on how to minimise the of buying and selling a home)
Thankfully as a practice we enjoy overwhelmingly positive relations with our clients. That said as everyone knows the process of buying and selling property can be stressful. We appreciate that we buy and sell homes day in and day out so for us there is little that can surprise us although it does sometimes happen. On the other hand, for the majority of our clients it’s something that happens just a few times in a lifetime so it’s completely natural that a process which is broadly speaking alien to them can give rise to some anxiety.
One question we are often asked is just why things take so long to tie up and for missives (contracts) to become legally binding. I think that’s a fair question. Having received an acceptable offer there is a tendency to think that it’s job done whereas sadly that is not the case and getting over the finishing line and to the legally binding stage can take time and nearly always longer than buyer, seller and agent want.
The fact of the matter is that like most things in life, the process has become significantly more complicated over the years. Back when I entered the profession some 40 years ago – I genuinely remember the excitement in the office the day we got our first fax machine ! – things were far easier and most contracts concluded in a couple of weeks tops. Now an increasing number of factors need to be factored into the equation. As we explain to clients trying to coordinate and tie up a sale and a purchase is very much a juggling act with, a time at least, both transactions up in the air because very few clients want or are able to conclude a contract for their purchase until their sale is itself legally binding.
Whilst we try to minimise the stress our clients feel at times the very nature of Scots law and the often protracted process of getting a mortgage offer issued means that delays can be experienced and nerves can become frayed. When coupled to the tortuous reality of being in a “chain” (once the reserve of an English system generally considered to be the poor cousin of the Scottish system) a property transaction can be an anxious time.
Even seasoned home-movers are not immune to the odd restless night. Studies show that a typical person over 50 will have lived in their home for an average of around 22 years. With changes in the law such as the complete abolition of the feudal system, the introduction of Standard Missives, Land Registration as opposed to Sasine recording of titles plus the scrapping of Stamp Duty and introduction of Land and Buildings Transaction Tax (LBTT) plus all the Anti Money Laundering regulations and the need to produce all manner of ID and paper trails for deposits being provided, almost everything will have changed since the last big move. Although clients may feel they have a sound understanding of what’s involved, it’s likely their knowledge is a little out of date.
So can anything be done to help speed up the conveyancing process and make your transaction run more smoothly? Well whilst it’s just not possible to eliminate all stress there are indeed some steps that clients can take to minimise and manage the butterflies. From picking the agent best matched to your personality and needs to the more practical steps you should take, here are our top tips for a better informed and less stressful move.
1. Don’t just go with the conveyancer who offers you the cheapest fee or the estate agency who give you the highest valuation.
If you’ve received this newsletter then clearly, you’ve already used the firm in the past. We hope that your experience was a positive one and that if in the future a move is on the cards that we would have the privilege of representing you. We don’t however take that for granted and know that many clients still seek another couple of quotes for comparison purposes on both service and fees. Like properties themselves, not all firms are created equal. Keeping everything under one roof with a full estate agency and conveyancing service can be more cost effective and avoids scenarios where the left and the right hand don’t know what the other is doing as can be the case where an agent such as say a Your Move, a Remax or other national is handling the estate agency and a firm of solicitors the conveyancing. By using a solicitor estate agent you will also have access to espc.com as well as Rightmove and Zoopla. The ESPC is still where the majority of our sales originate and is unavailable to sellers who use the nationals such as Remax, Your Move and the online brands such as Yopa and Purple Bricks. Whilst the nationals often have their “tame/pet” solicitors and most are very good, be aware that those solicitors rely upon a steady stream of referrals from the agent and there is a school of thought that questions whether they attempt to and can serve two masters.
Another worrying yet growing trend we are seeing is that of certain agencies seeking to list homes and turn heads by giving unrealistic, exaggerated valuations. We understand why a seller can be tempted to list with an agency that appears to have a more positive view of your home, and which appears confident that they will secure a better price. The trouble is that this tactic almost never works and after weeks of languishing on the market the inevitable happens and the asking price is lowered. Those who follow the local market closely and who subscribe to property platform updates will be used to seeing property price reductions coming into their inbox and this should help identify the culprits. Every agent at some time has to adjust price but when that becomes closer to the norm and not the exception questions should be asked and caution exercised.
Maybe it’s worth the punt you might think? What have I got to lose? The evidence suggests that it is more often than not a costly gamble and there is a lot to lose. The longer a home is on the market, the less likely you are to achieve its proper value and dropping the asking price to a realistic level weeks or months into the sale seldom solves the problem. Those that could have bought had the property been priced correctly at the outset have now bought alternatives and your home is no longer the “new, shiny listing and evidence shows that further price drops tend to be required to capture the interest of a dwindling audience.
2. Be Patient!
We’re not being flippant and it’s far easier said than done we know, but the fact is that in about 95% of cases where we have sold a property the contracts will conclude, and the move will happen. Yes there is a 5% or so fall through rate (normally where a purchaser’s own sale collapses or their mortgage offer fails to materialise) but as we always tell clients the odds are stacked in your favour and to concentrate on the 95% success rate. Typically missives now take around 8 weeks to conclude but it’s not unusual to take longer depending upon circumstances. Sadly it is very seldom quicker.
3. Do get your finances in order first
The first step when preparing to buy or sell a property should be to take stock of your finances. Draw up a list of all the potential costs of your move and be sure to include conveyancing (including all disbursements), estate agent’s commission, mortgage arrangement fees and LBTT. Failure to budget early could slow down or even derail your move. One of the major delays in concluding missives and getting to a point where one has peace of mind in knowing that there is a legally binding contract is waiting for the Approval in Principal ( AIP) secured from a lender turning into a fully blown written offer of loan. Given the stricter lending criteria introduced by lenders since the 2008 financial crisis and the possibility of AIP decisions being retracted at the full underwriting stage, few buyers if any will conclude a contract until such time as that formal offer lands on the doormat. Our advice is to stay in close contact with your lender and/or mortgage adviser to make sure they are aware of entry dates and have everything they need to complete the underwriting process. Chancellor Rachel Reeves is currently discussing with industry leaders the possibility of relaxing lending criteria once more in an effort to boost the economy so this particular area of anxiety may be eased in then course of the next year.
4. Don’t be afraid to ask questions
To ensure you stay in control of your move and don’t get any nasty surprises further down the line, please ask as many questions as you need to. As we have said we know the process inside-out and have extensive experience of helping people who don’t, but we won’t always know what’s on your mind. Our standard processes, letters and information booklets try to address the most frequently asked questions but there will inevitably be questions and queries you have so please ask.
5. Do read all documents carefully and return them promptly
As with any legal documents, it’s important that you read carefully and understand those that are sent to you during the conveyancing process. As above, if you’re not sure about anything or if you think we have misunderstood your instructions it’s important that you call us immediately. It’s also important to return anything we send you for signature in a timely manner so the process can move forward without avoidable delays. If you prefer to sign here with us then that of course would be our pleasure.
6. Don’t cancel your existing mortgage payments too soon
Wait until we have confirmed that the contracts have been concluded and a date of entry fixed. Eleventh-hour purchase collapses whilst rare are not unheard of.
7. Gather paperwork.
Whether it’s planning permissions and building warrants for alterations and extensions, or proof of funds for your deposit, we will need these so look them out in advance to avoid panic later. Anti money laundering regulations are extremely stringent and we are obliged to follow them to the letter. Gather three months bank statements, proof of your source of funds if in a different account, payslips and perhaps even your contract of employment plus address and photo ID. If you are benefitting from a gifted deposit from family be aware that we will require proof of ID and source of funds etc from them too so warn them in advance.
As we always say, buying and selling is a team effort and all about partnership working between client and agent/solicitor. We have at maloco mowat parker a winning team with a proven winning mentality. Put yourself in our hands and we’ll guide you through the buying and selling process and of course it costs nothing to have a chat. Remember most obstacles can be overcome and nearly all challenges met. That is our mind set so try to stay calm and stay positive. And if of course there is ever a time to panic we will be sure to let you know!!
