Few house sales run smoothly and increasingly a number of house sales fail to complete because the seller accepts another offer, leaving you out of pocket and very disappointed.
House sales fall through for a number of reasons, we will look at the most common reasons and see if you can take primitive measles to lower the risk of losing out on a property purchase that you had set your mind on. The unfortunate truth is that is more common than you may think, with some sources saying as many 300,000 house purchases fail in the UK alone. Worth repeated, that is three hundred house sales that fail to complete!
Why do so many house purchases fail?
Some of the common reasons include discovering a flaw in the building uncovered by the survey report. A break in the selling chain , A sale further up the chain failing, the seller decides it is not time to sell or simply being gazumped. Add to this the new trend called “price chipping” in which the buyer request thousands off the price just days prior to completion.
The common tread with all these reason is that you have no recourse should it happen to you, as no formal contract exists between buyer and seller. Without a signed contract, either party can drop out at any stage until the final signing.
How can you protect against financial loss is a house sale
One solution would be for the government to formalise the process by introducing a binding agreement after a sale has been agreed and before either party starts to spend money on surveys and solicitor fees. Of course, provision would exist to exit the agreement if a valid reason were to surface during the discovery phase, after the agreement was signed.
Steps you can take now to protect yourself against financial loss
Until the process is more formalised you should look at how you can recover any costs should your home purchase fall through.
Get Insurance : A product that has gained popularity is home buyer insurance, a product aimed at recovering costs as a result of a hose sale failing. The product can be purchased by both the house buyer and the house seller, protecting both parties in the sales chain. Check out Multi Quote Time’s guide on how home buyers protection insurance works in both the UK and NI. Available insurance will let n claim back solicitor fees up to £750, survey or valuation fees of up to £500 and loan arrangement and lenders fees of up to £250
Keep the process smooth for the Seller : make sure you have all the paperwork and loan agreement in place upfront. In addition, you could go one step further and provide a gas and electrical safety reports.
Get to know the owner: Getting to know the owner will it more difficult for the owner to accept another agreement than if you were just a name on a piece of paper. The sales agent may not encourage this in case you decide to cut them out, but nothing is stopping you exchanging email addresses and making contact.