Regardless of your position, you may feel it’s in your best interest to renegotiate the terms of a property sale. However, this can be a step backwards in the conveyancing process, leading to the move in date getting pushed back. Renegotiations should therefore be planned and executed accordingly.
The Conveyancing Process
A buyer is free to change their offer during the conveyancing process, however, only up to a certain point. Let’s look at what’s involved in the buyer’s process.
- Appoint a conveyancer – professional property conveyancing services are essential to help with the legal side of the sale. Conveyancing solicitors review complex documents and ensure matters are proceeding. If you’re looking for property solicitors Consett, Toomey Legal has you covered.
- Examine draft contract – review important documentation and address any questions raised. This is primarily done to as quality control to ensure the property sale progresses smoothly. However, it’s important at this stage to find out whether the property is freehold or leasehold.
- Conduct property survey – confirms seller claims and highlights problem areas that need further investigation. A property survey isn’t a legal requirement; however, it is integral to accurate property valuation. Conducting a property search can subsequently reveal any liabilities the property might have. This includes flood risk, local authority plans, chancel repair risk, other environmental conditions.
- Organise Mortgage – securing a mortgage is its own process, for which conveyancing solicitors can provide advice. Once finances are confirmed and the mortgage valuation is given, the solicitor will review the conditions.
- Exchange of contracts – at an agreed upon date and time, solicitors on both sides will read out contracts and send them. This means the buyer is legally bound to purchase the property, while the seller is legally obligated to sell. The seller is also unable to accept another offer.
- Prepare for completion – this includes the transfer of deeds in the buyer’s name, the seller moving out, and the buyer preparing to move in. The seller’s solicitors will confirm all payments have been received and then keys are made ready for collection.
A property sale is subject to contract. So yes, the sale of the property can be renegotiated at any point before the exchange of contracts. Past this stage, the sale is legally binding and the buyer will be called upon to produce their deposit payment.
Reasons for Price Renegotiation
Renegotiating can add time to the already lengthy conveyancing process. As a result, buyers and sellers are unlikely to enter renegotiations unless they have good reason to. That being said, there are a few justifications for re-evaluating sale price.
- Defects are found in the property
Most often, people renegotiate based off property survey results or due to problems found in property searches. This is because unexpected or undeclared issues can negatively affect property valuation. Issues will relate to the day-to-day living of those living in the property, either through problems with the surrounding area or the property itself.
- Seller receives higher offer
There isn’t any legal way to stop a seller from continuing to receive offers well into the conveyancing process. As a result, there is a risk that they’re offered more for their property than the current buyer has agreed. In this case, the seller might initiate renegotiations because they want to match the higher offer while still selling to their current buyer. After all, renegotiating is still less time-consuming than starting the conveyancing process afresh with a new buyer.
Click here for more information on What is Gazumping.
This is a general term for when a buyer lowers their offer just before exchange of contracts. However, unlike renegotiations that follow property surveys, gazundering often occurs purely for financial gain. Buyers can have power over sellers that are reliant on sale-generated funds to buy their next property. This typically happens in a property chain, where the seller also experiences pressure not to hold up the chain.
How to Renegotiate the sale of a Property
Every property sale is a different beast, so the nature of renegotiations will be on a case-to-case basis. Plus, as we’ve established, there can be many reasons for renegotiations. So instead of going through every scenario, we’re covering some best practice to make renegotiating work for you.
Firstly, don’t be afraid to ask to renegotiate. Most estate agents will deal with this day in day out. What’s more is that your concerns are unlikely to be dismissed, as other buyers will find the same issues. Therefore, by choosing to walk away you could be missing out on renegotiating a better offer.
Be honest. Issues and Discrepancies found during a property survey are perfectly justifiable grounds for renegotiation. Sharing these findings helps the other side see where you’re coming from and both parties can be on the same page about the value of the property. The sooner issues are discussed with the seller the less likely the deal is to fall through.
Expert Local Conveyancing
Toomey Legal are client focused solicitors offering local conveyancing quotes Newcastle. Our no obligation quotes, in combination with 24/7 progress checking, allow buyers to accurately value their property purchase. Our team strikes the perfect balance between friendly and professional, making your conveyancing experience as smooth as possible.
For expert legal property help and advice, contact Toomey today.