A buyer’s change of mind. House selling heartache. Not just fiction.
Poor Detective Superintendent Roy Grace, the fictional character of author Peter James’, whose buyer suddenly and without any explanation, pulled out of her intended purchase of his house – in the latest Grace novel ‘Dead Man’s Time’. And after such a typical and promising start; an offer for the full asking price, a date set for an exchange apparently at the point of her offer (very rare, but something all buyers and sellers should try and secure), and prompt action from the buyer’s conveyancing “solicitor” by the forwarding of a “detailed questionnaire about all aspects of the property”.
(A pleasant surprise that the buyer at least secured themselves an actual conveyancing ‘solicitor’, as few people ensure they enquire about who will be acting, let alone actually receive either a solicitor or a chartered legal executive, when looking for a conveyancing quote.)
Sadly for many property sellers, Detective Superintendent Grace’s position is all too familiar. The problem unfortunately lays with the current system of conveyancing here in England and Wales. Until a contract for the sale of the property is in place, there is no legal commitment by either the seller or the buyer, and both can walk away.
The ‘commitment’ almost always takes the form of an ‘exchange of contracts’ where essentially the conveyancing solicitor for the buyer and the conveyancing solicitor for the seller telephone each other and agree to place their client’s respective signed parts of the contract in that evening’s post. It is that verbal promise and the hanging up of the telephone which seals the commitment.
Frustratingly, this commitment/exchange of contracts can come many weeks – and often months – after the estate agent breaks the good news that the seller accepts the buyer’s offer. That good news is really only a show of intention at that point, nothing more. Whilst contract law does requires an ‘offer’ and ‘acceptance’ to create a valid contract, in the case of a property contract, it also needs to be in writing. But to get parties to that point, the current system of conveyancing gives the parties free reign, without time limit to either get to that point, take as long as they want or simply never get there because one changes their mind and backs out (true, the system does allow either buyer or seller to back out, so no one side has the advantage over the other).
However, while no guarantees can ever be given, certain steps can be taken to hopefully minimise the risk of either party backing out:
- Instruct your conveyancing solicitors as early as possible, so they are ready for the first moment the legal work is needed. And carefully chose your conveyancer, as the quality in the market place ranges from very poor to excellent.
- Have your mortgage ‘agreed in principle’, ideally perhaps with it all ready except for the lender’s satisfactory valuation.
- Sellers should ensure they have an estate agent who does not give up at the point of an offer having been accepted, but actually keeps involved with the conveyancing chain right through to an exchange of contracts (not an agent who just phones everyone seeking updates but never calls to in fact offer information and help).
Fortunately for Detective Superintendent Roy Grace, his girlfriend’s parents stepped up, and offered to lend them some money until his property sold. Again, a method some home buyers remember as their way on to the property ladder.