The thought of purchasing a house can fill anyone with bubbling excitement, but before you can unlock the keys to your dream home, there are various legal considerations and out-of-pocket fees to consider on top of other upfront costs. One of the biggest challenges involves conveyancing when the homeownership undergoes a legal transfer from the seller to you or vice-versa.
What is the Importance of Conveyancing?
This is a critical part of buying a property since it’s the time where all preparations and exchanges regarding the contracts of sale are carried out.
Most of the time, it’s a straightforward process that starts by accepting the seller’s offer down to the day you have full ownership of the property, but it’s a fragile process that can easily turn into a problematic experience for the unprepared buyer.
Complications with the conveyancing process can be time-consuming and expensive, so we’re here to focus on the blunders you should steer clear from in the future:
Common Conveyancing Problems to Know and Avoid
1. When the Seller Switches to a Different Buyer with a Higher Offer
Things can go smoothly up to when the seller jumps ship and accepts a different buyer’s offer. It’s an acceptable action called “gazumping,” which is frustrating at its worst, but it is within legal boundaries so long as no contracts have been signed.
This means that the property is still hot on the market even if you are already in the middle of the conveyancing process, though there are high chances that the seller chooses your offer in that case since they don’t have to start the transaction from scratch. You can also choose to match the new buyer’s offer if you have the extra cash to snag your dream home.
2. The Buyer Doesn’t Pay the Deposit on Time
If you are the seller, then there is a high chance that the buyer won’t make timely payments. You’ll need to contact your real estate agent as they can keep you on top of the situation, though a solicitor can also help charge interest as the buyer prolongs the deposit.
3. The Buyer Cannot Settle on Time
The purchaser may experience delays when the bank fails to process their mortgage documents on time. It’s a negative chain reaction that can impact you, the seller, though having a conveyancer can ensure you won’t get the shorter end of the stick by informing you of your rights. Some of the solutions involve the solicitor asking the purchaser to charge interest for the delays.
4. The Buyer and Seller Disagree on Terms
Once a buyer accepts the seller’s offer, the conveyancing process starts. The first steps involve exchanging letters with terms and conditions that both parties need to agree on, such as the price, date of entry, fixtures, fittings, repairs, and more.
There are instances when one of the parties may disagree with the terms, so having a conveyancing solicitor helps iron out any differences and help establish a reasonable compromise.
5. The Buyer Fails to Obtain Finance
Many people wish they can purchase a house in one fell swoop, but the reality is that most need some form of financial support from the bank to help pay the steep price. This pushes the buyer to agree on a Contract of Sale, which means paying for a certain amount on a set date.
The problem often occurs when the bank or lender approves the loan beyond the contract's agreed date. When this happens, you will have to pay for the consequences, usually involving penalty fees or even the end of your contract.
With that in mind, preparing your loan documents in advance is critical if you want to avoid experiencing these complications.
6. Problems with the Property
Spotting any property faults must always be addressed, particularly since buyers can end up buying a money pit if all these underlying problems are left undiscovered. That’s why home inspections are essential even if it puts the conveyancing process to a halt. Depending on the damages, a conveyancing solicitor can help determine who should organize and pay for any necessary repairs.
These changes can also impact the price, so both parties may need to restart the process and renegotiate the fair asking price.
7. The Mortgage Expires Before the Conveyancing Process is Done
A mortgage typically lasts between three to six months, giving buyers or sellers a small timeframe to complete the transaction. Experiencing delays can lead to the mortgage expiring before all the legalities have been ironed out, which means you will have to apply for a new mortgage.
That’s why it’s important to know your conveyancing quotes as it helps draft the appropriate timeframe that leaves enough room to let the conveyancing process play out without rushing to beat the clock.
The Bottom Line: Exploring Key Conveyancing Issues You Should Know to Prepare For Your Future Property Transactions
The conveyancing process is a necessary step both buyers and sellers need to take. It’s a time-consuming journey, but with the right preparations, you can go from accepting the offer to settling down into the new home without running into any bumps in the road.
In many cases, it’s essential to know the conveyancing complications that can occur in both parties so you can avoid running into them in the first place.
These mistakes can often burn holes in your wallet or result in the termination of your contract in the worst-case scenario, so this iterates the importance of hiring a conveyancer to help you navigate the home buying process from start to finish.
How Can We Help Simplify Your Home Buying Experience?
If you’re looking for something that can help take the guesswork out of the home buying process, our expert team of SRA regulated solicitors and licensed conveyancers in the UK can simplify the experience for you.