The decision to sell your property, whether it is your home or an investment property, can be a daunting one. For that reason, a general knowledge of the key steps that are involved in the sale process, and the order in which they can be expected to take place, can be crucial to ensuring that you are able to proceed with the sale smoothly and efficiently.
1. Understanding Value and Marketing the Property
Anyone who is considering selling their property should first arrange for the property to be professionally valued, either by an Estate Agent or a valuation surveyor, in order to obtain an estimate as to how much the property will be worth. A professional valuer will be able to provide a guide, often within an ‘upper’ and ‘lower’ estimate bracket, as to how much a prospective buyer will be willing to pay, taking into account the location and nature of the property, along with current market conditions. In order to avoid potential disappointment once offers are received, it is important to ensure that a reputable valuer, who has strong knowledge of the local market, is instructed. Once valuation advice has been obtained and you are happy to move forward with the sale, you will be in a position to market the property with a local Estate Agent and begin to arrange for viewings with potential buyers. Most Estate Agents will also ensure that the listing is placed on major online platforms too, such as Rightmove.2. Existing Mortgages and Occupational Tenants
When considering the price that you intend to market your property for, the amount outstanding on any existing mortgages charged against the property should be considered. Any such mortgages will need to be redeemed, in full, on completion of the sale, and particular care should be taken to ensure that any early repayment charges or account closing fees are included in your calculations. If the property that you are selling is subject to the occupation of a tenant, but the property is to be sold with vacant possession on completion, it is important to ensure that any necessary Notice to Quit is served on the tenant in accordance with the terms of the Tenancy Agreement. Whilst the provisions of Tenancy Agreements will vary, it is common for break-clauses to require a Landlord to provide at least two-months’ prior Notice to a Tenant, before they can be required to vacate the property. This can, in turn, affect the timescales within which the sale can be completed.3. Agreeing the Sale and Instructing a Solicitor
Once a buyer for the property has been found, and the sale price has been agreed, you will need to instruct a Residential Property Solicitor to proceed with the conveyancing process, which is described in more detail below. Your Estate Agent will also issue a Memorandum of Sale to all parties, which sets out details of the terms that have been agreed with your buyer. At this stage, it is important to ensure that the Solicitor you decide to instruct will offer the level of service and client care that you expect to receive (for example, being provided with direct contact details for the fee-earner who will be responsible for your transaction). You should also ensure that your Solicitor has an understanding of, and experience in dealing with properties located in, the area in which the property is situated.4. The Conveyancing Process
Upon instructing your preferred Solicitor, they will proceed with the conveyancing process. ‘Conveyancing’ is the process of transferring the legal ownership of a property from one party to another. The key steps involved with the conveyancing process, which will be handled by your solicitor, are as follows:- On-Boarding – Completing the on-boarding procedures of the law firm you have instructed, including verifying your ID documents to comply with Anti-Money Laundering Regulations;
- Deducing Title – Obtaining title documents for the property from the Land Registry, in order to deduce evidence of your ownership of the property to the Buyer’s own Solicitor;
- Standard Forms – Arranging, and assisting you with, your completion of standard Law Society forms (including a Property Information Form, Fittings & Contents Form and, if relevant, a Leasehold Information Form);
- Contract – Drafting and submitting a Sale Contract to the Buyer’s Solicitor, for their review and approval, on the basis of the terms that have been agreed with the Buyer;
- Management Pack – If the property is Leasehold, arranging for the building’s managing agents to provide a ‘management pack’, including replies to standard block-specific enquiries and any supporting documents;
- Enquiries – Dealing with, and where necessary obtaining your instructions on, any additional enquiries that are raised by the Buyer’s Solicitor resulting from their review of the title documents, draft Sale Contract, management pack, completed Law Society forms and any search results they have obtained;
- Exchange of Contracts – Once the Buyer’s Solicitor’s enquiries have been satisfied, the parties can agree the completion date and proceed with exchanging Contracts on that basis. Exchange of Contracts makes the terms of the Contract, including the completion date, legally binding on the parties, and parties may face contractual penalties if they fail to complete once Contracts have been exchanged (or if they are in breach of any other obligations under the Contract);
- Completion – On the completion date, the Buyer’s Solicitor will arrange to transfer all completion funds to your Solicitor. Your solicitor will arrange to redeem any outstanding mortgages, along with paying the Estate Agent’s fees. The remaining balance will then be transferred to you, as sale proceeds. On, or before, the day of completion, you will need to ensure that the property is cleared of any items that are not included in the sale, and arrange to leave any available keys with the Estate Agent, for the buyer to collect.