10 Step Guide to Selling a Property
27 September 2016
Selling a property is a big step. Whether you are familiar with the process or not, please do consider these 10 simple steps:
Step 1: Your Current Mortgage
If you already have a mortgage on your property, contact your lender and ask for a settlement figure or balance. Make sure you don’t ask for a “full redemption” statement, as this includes any early redemption payments and the lender may think you are actually ending your mortgage there and then and may stop your mortgage payments.
Certain lenders such as Halifax will stop taking payments if the consumer asked for a redemption statement. Their system assumes the mortgage will be paid off so you need to ask for a settlement figure rather than a final redemption statement.
The settlement figure will help you to know how much equity is in your property so you can budget properly and know what you can expect to receive after the sale. If you are also buying a property, you’ll need to take into account the equity you can use from your sale in your purchase. Knowing all of this information will help you know how much you need to sell your property for.
Step 2: Instructing an Estate Agent
Traditionally, the most common way to sell a property is through a high street estate agent. The agent will visit your home, view it and take the measurements of the house and garden. They will then suggest a sale price and provide you with a copy of their Terms & Conditions. Make sure you read these carefully, as they will include the percentage of the sale price fee that they will charge you. This amount will need to be budgeted into your moving costs.
A more untraditional route, that is gaining momentum, is to explore online estate agents. This will need you to be more hands on in the sale process. Read the Terms & Conditions so you fully understand what’s being offered and what’s not and be clear about the percentage fee you will be charged, depending on the sale price.
Ask the estate agent to talk you through how your property will be marketed, where and how often. This will probably include being on their website and other property websites and in local newspapers. Ask yourself if they will they effectively target the types of people who will buy your property and if not, try another estate agent.
Make sure they will take good quality photographs of your property so it is shown in the best light. Some estate agents offer online videos of your property, aerial views and even online messaging to potential buyers. The more tools the estate agent you instruct uses, the more chance you have of selling.
Many estate agents will now provide an Energy Performance Certificate (EPC). You’ll need one before you can sell or market your property, so if they don’t provide this, you will have to get one. An EPC contains information about a property’s energy use and typical energy costs. It also provides recommendations about how to reduce energy use and save money.
Try your best to speak to and get three quotes from different estate agents in your area. You will then have all the facts and you can look at the valuations that each of them has given alongside where your property will be marketed, how regularly you will be contacted with updates and whether you can build a rapport with the estate agent. All of these things can help you to decide if their service meets your expectations.
Once you have agreed the fee with the estate agents, usually based on a percentage of the sale price, remember to deduct this amount from your equity as you will usually be required to pay the estate agent’s fees from the net proceeds of sale.
Step 3: Take a Step Back to Look at Your Property
Before your estate agent comes to see your property, take a step back and look at your home. Most of us leave minor DIY jobs to be done and it can be easy when you live in a house, to overlook the small details. You need to assess whether any work that needs to be completed will impact on the potential sale price. If it will, seriously consider doing it yourself or paying someone to do it for you.
De-clutter and if possible de-personalise. Most buyers want to imagine themselves in a spacious property and clutter and personal belonging will not give that feel. Buyers also tend to make a beeline for special features or period details so if you have distinctive items in the property such as original fireplaces, always show them at their best.
Kitchens and bathrooms in a property are very important and you should pay special attention to them. Clear the kitchen of all but essentials and put fresh, clean towels in the bathroom. Don’t use all of your storage space or overload wardrobes, as storage space is one thing buyers will look at. Make sure you have sufficient space.
Clear the garden, tidy away any children’s toys, de-weed and cut the grass. The garden will be seen as an extension to the property and an area for socialising and entertaining. Make it as welcoming as possible.
Consider placing flowers around the home when you have a viewing and the old ideas around having bread baking before a viewing still stand. If baking isn’t your thing, perhaps brewing some fresh coffee would be a good substitute.
Step 4: Instruct a Solicitor or Conveyancer
When you receive an offer on your property you’ll want to get things moving as soon as possible. Buyers can be put off if they think that there is a delay. Get a conveyancing quote as soon as possible. This will allow you to budget effectively. Your chosen Solicitor or Conveyancer will send you a Property Information Form and a Fixtures, Fittings & Contents Form for you to complete and return to them. You will save time if you can complete these forms before receiving an offer.
Until contracts have been exchanged, the sale is not legally binding. Even though you’ve accepted an offer, a potential buyer can withdraw from the transaction at any time.
At Co-op Legal Services we offer a No Sale No Fee Guarantee. This means if a buyer does withdraw before exchange, you won’t pay any of your legal fees. Bear this in mind when you instruct a Conveyancer. See Top Tips for Choosing a Conveyancer.
Step 5: Property Viewings
When you have a viewing, your estate agent will usually show the potential buyer around your home. But on some occasions, you will have to do this yourself. Have a plan as to how you are going to show your property. Take your time, don’t rush but don’t be too slow either. Point out the positive points of your property such as a south facing garden but don’t point out negative things, such as lack of parking.
If you have pets, keep them contained or even ask a friend or relative to look after them whilst the viewing is taking place. Buyers may be allergic to pet hair so make sure you have a thorough vacuum before they arrive.
Try not to say too much, but be around to answer any questions and to build a rapport with any potential buyer.
Step 6: An Offer to Purchase
A buyer will usually place an offer with your estate agent. The agent will contact you with the offer and ask for your instructions. Don’t accept the first offer, consider the following:
• Does the buyer have a property to sell? If so, have they accepted an offer and is the chain ready to proceed? If not, you could be waiting around for some time. You could accept the offer on the condition that you will continue to market the property until they are in a position to proceed.
• How quickly does the buyer want to move? Does this fit with your timetable?
• Does the offer match what you need after you’ve considered your financial position?
• Is the offer conditional? It may be conditional on exchanging contracts in a certain time period or completing on a certain date.
• Does the buyer need to buy the house with a mortgage? If so, do they have a mortgage offer accepted in principle?
If you are happy to accept the offer, you should contact the estate agent to confirm this. You’ll need to also contact your Solicitor or Conveyancer and confirm that you have a buyer. Provide them with all the details, along with any conditions or deadlines for exchange or completion so they know what you are working towards.
Step 7: Communication
It’s important to be available as much as possible throughout the transaction. If you are going away on holiday tell your buyer, estate agent and Conveyancer. Ask for the buyers contact details so you can build a rapport with them throughout the transaction and keep up to date with progress they are making at their end.
Step 8: Pre-Exchange
Your buyer will instruct their own Conveyancer and they’ll give these details to the estate agent. The agent will then notify your Solicitor or Conveyancer. They will draft the contracts and send these to the buyer’s legal representative. At Co-op Legal Services, our partnered Conveyancers have agreed to contact the buyer’s legal team within 1 working day of being notified of the transaction and issue contracts.
The buyer’s legal team will review the contracts and raise any enquiries regarding the property. They will also submit searches on the buyer’s behalf. For Top Tips on property searches see What Property Searches Do I Need and Why?
Once the buyer’s legal team has received all outstanding information, they can exchange contracts and request a deposit from their clients. Your Solicitor or Conveyancer will get an up to date redemption statement for you and provide you with a draft Completion Statement. This will confirm the money being received, what is being paid out and what will be left after the sale.
Step 9: Exchange of Contracts
Contracts are exchanged between both legal teams when all parties have provided their instructions, agreed the purchase date and price and are in a position to proceed. On exchange, the buyer’s Solicitor or Conveyancer will pay the deposit to your Conveyancer and formally exchange contracts. This is when the transaction is legally binding and a completion date is set.
Step 10: Completion Date
The completion date is when the property has to be vacated. This is usually before lunchtime. It is important that you remove all items, including rubbish, from the property so the buyer can take ownership. Don’t leave this to the last minute as there is always more to do than you perhaps appreciate.
The working day before completion is usually when the buyer’s legal team will receive any mortgage advance and balance of funds from their client. On the morning of completion, after final checks have been completed, the buyer’s legal team will transfer the balance of funds to your legal team.
Only when these funds have been received by your legal team is the transaction complete. At this time, you should hand over the keys to the property if you’ve not already left them with the estate agent.
Your legal team will settle the estate agent fees, your outstanding mortgage if you have one, and their own legal fees. Any balance left will be transferred to you.
Congratulations! You’ve sold your property!
Co-op Legal Services offers fixed fee Conveyancing services for residential properties in England, Wales, Scotland and N. Ireland.