Legal implications around COVID-19 on property purchase and sales
During this time of uncertainty – we answer some of the most frequently asked questions our residential property lawyers have received at this time.
What does the latest Government guidance on home moves mean?
The Government guidance states that home buyers can continue with their purchase if they are moving into unoccupied properties. Moves that are classed as "critical", such as situations where contracts have exchanged and neither party can reach an alternative moving date, can also proceed and are currently exempt from the emergency police enforcement powers.
I haven’t exchanged contracts yet – what can I do if someone in the chain pulls out if they become ill or suffer financial loss due to coronavirus?
The best thing to do is talk to your solicitor and estate agent to keep the chain moving whilst staying in the Government's Covid-19 guidelines.
Would communicating with other members in the chain help to progress and secure the purchase/sale?
I’m considering starting a sale/purchase process on a property – should I go ahead at this time of uncertainty?
Yes. Nothing is legally binding until you exchange contracts – so you can still get the ball rolling now and then assess your options in the coming weeks/months. If you're worried about up front costs, you can ask your solicitor about deferring payments for searches to the end of your transaction. Other costs such as surveyors' fees, may not be deferred and you may wish to consider Homebuyer's Protection Insurance to cover you for these in the event of the transaction falling through for reasons beyond your control.
I’ve already exchanged contracts – what happens if someone in the chain defaults?
If agreement cannot be reached, then a 10 working day notice can be served which opens up further options. You can speak to your solicitor for advice on this.
I’ve exchanged contracts – but what if I (or a family member) becomes ill or my financial situation changes and I need to default or try to pull out?
Your solicitor could look to try and negotiate a release from the contract or a suggest a delay to avoid any forfeiture of deposits.
Time only becomes a problem if one of the parties in the chain serves a 10 working day notice.
What if my solicitor is not open for business or is short staffed during this coronavirus pandemic? What will happen to the conveyancing process of my house purchase/sale?
If you find yourself in the situation where your house move is not being progressed for this reason – then you are entitled to appoint someone else who has the capacity and business continuity options to step in and take over the process for you. Wherever possible you should speak to your existing solicitor to ensure that you will not incur any costs by moving your case.
PLEASE NOTE: this information was correct at the time of publication on 19 March 2020
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