Serious Problems Caused By Solicitors Inexperienced in Conveyancing
Your Solicitor Could Miss A Defect
Unfortunately, this is not uncommon, and can come about if your solicitor does not carry out all the crucial legal checks. As a purchaser, you have total liability due to the English Law ‘buyer beware’ principle. And if you do not request a full report you can check and raise questions on, then you could potentially suffer a substantial financial loss of tens of thousands of pounds. What most purchasers do not realise is that sellers are not under any legal onus to disclose defects. So this task is the duty of the purchaser who usually puts it in the hands of a solicitor.
Lack of Appropriate Searches
Some purchases are faced with a traumatic financial loss and suffer tremendous stress due to their solicitor making shortcuts and saving money by not requesting sufficient searches. When an experienced high level conveyancer deals with a purchase, they order a complete search pack. This comprises searching for repair liabilities, flooding, hazardous substances, and numerous other factors which are extremely serious in nature. Once again, due to the “Buyer Beware” law, if you discover something adverse after your purchase, you have no recourse.
Pitfalls In The Mortgage Offer
Unfortunately, some solicitors do not go into sufficient detail when they are discussing the mortgage offer with the buyer. Without being given a complete breakdown, you may not be aware of certain pitfalls, and may have to pay a very high price later down the line.
Difficulties With The Buyer
Changing Their Mind
One of the major problems you can face is having the buyer pull out of the sale prior to exchange of contracts. Unfortunately, this could be just before the anticipated exchanging of contracts, which would mean that you are likely to have incurred legal costs which the purchaser is not legally obligated to pay or contribute to.
Reducing The Price They Agreed To Pay
Prior to exchange of contracts the buyer could give you a shock by deciding to change the initial offer you agreed on so they pay less. If they do this just prior to exchanging contracts, it is referred to as “gazundering”. This practice is quite legal, and usually comes about when the prices of property are decreasing.
Pulling Out Of A Sale After Exchange of Contracts
If this occurs then you may be entitled to hold on to the 10% deposit, and you may also take legal action against the purchaser for any for any losses you may have encountered.
Difficulties With The Seller
One very common scenario is when the buyer is “gazumped” by the seller. For example, the seller could accept your offer on their property, and then later down the line, notify you that they have received a higher offer from another buyer. This practice, known as “gazumping,” is also perfectly legal prior to the exchange of contracts, but it leaves you in a quandary as to whether you should forget their property and look for another one, or offer a higher purchase price and risk being gazumped again by a seller who had no qualms about doing it the first time.
Withdrawing Acceptance Of Your Offer
Prior to exchange of contracts, the seller is able to recede their acceptance of your offer at any time. They may do this because they have decided not to sell, or more likely, because they have had an offer from someone else. It is highly likely that you will have incurred legal expenses and survey fees, however, there is no legal obligation for the seller to pay or contribute to these expenses.
A Contract Race
This refers to the scenario when a seller accepts offers from more than one person. It is completely legal. When this happens, the seller has to instruct their conveyancer to send draft contracts to all their prospective purchasers. In such a case, the conveyancer has a legal duty to let the latter know that multiple contracts have been sent out. He or she will also make the prospective purchasers aware that the person who will get the property will be the first one who has returned the contract and has everything in order for exchange. If you are alerted to the fact you are in a contract race, you only have two options: to try to complete quicker than the other contenders, something which maybe difficult if one of them does not need a mortgage; or withdraw your offer, thereby saving the extra money it would cost you to complete quickly.
Both seller and buyer could well find themselves caught up in a long chain of of other sellers and buyers, with long delays blocking the flow of completions. Unfortunately, there is very little that can be done, however, if the difficulty is with your purchaser, or further down the purchaser’s chain, then you could opt to find another purchaser, or organise a bridging loan. Alternatively, if the difficulty rests with the seller, you might think about finding another property, or continue on with the sale, and organise a rented property until completion.