Specific performance is an equitable remedy, which means that its award is discretionary, and as such, it is not available as of right. Before exchange of contracts can take place, you and the seller will be required to agree a completion date. They are still awaiting their mortgage offer, they need the results of a search, there is an outstanding enquiry that needs to be answered. This means that damages are not usually adequate for a buyer. A seller's prerogative? Ask your solicitor to explain any conditions or terms you don’t understand. Failing to close on the agreed-upon date would be a breach of contract, assuming that the closing date was one of the contractual terms. The most common cause of delay in Contracts Exchange is quite simply because one of the parties in the Conveyancing Chain is not ready. The formal contract exchange is managed by legal representatives, and involves each party signing the final contract. If a survey showed any problems, the buyer may want more time to investigate them. The court will normally assess whether or not damages would be an adequate remedy if specific performance were not to be granted. Are we better off forcing a move, or rescinding the contract after the notice period if the seller does not want to move? Either party can delay this for a variety of reasons. This sets a new date – typically 10 days after the day the notice is served – for completion to take place. If the contract states a specific date, the seller can't delay without your written agreement unless your contract automatically extends the deadline. So if you are relying on the proceeds from the sale of your flat to complete your house purchase, serving a notice to complete would be inadvisable. This is usually because the buyer has been unable to raise the necessary funding for the purchase. EA. A signed contract is not legally binding until exchanged. We have no idea how long the lockdown will last and we don’t want to lose the buyer for our flat. We agreed to delay the … My flat is being sold, we have a buyer and they are ready to exchange contracts to tie in with the purchase of the house, so we do not have to pay the additional stamp duty. And, according to recent research, it's also the longest. Slow sellers or buyers: Sometimes it is the seller or buyer who delays the conveyancing process by maybe not signing contracts promptly or not offering information. The buyer will be given the opportunity to object to its removal if an application is made. 3. We exchanged contracts on a new build September 2019. This can also happen for a variety of reasons. Technically, the exchange seals the deal, but the seller may try to change their mind and return the deposit. 7. Each of the potential delays listed here can occur further down the conveyancing chain. When a seller refuses to complete a sale, as stated above, where damages would adequately compensate for the loss sustained by the breach, one of the contracting parties lacks full contractual capacity, the contract contains a vitiating element (eg mistake, fraud or illegality), a third party has acquired an interest for value in the property, the award would cause exceptional hardship to the defaulting party. But there are certain circumstances, such as where a significantly higher offer is received for the property, or the seller experiences an unexpected change in personal circumstances, that may lead to the seller indicating an intention not to perform the contract. Financial difficulties alone do not provide a defence, so a buyer will not be denied specific performance just because a seller may find it difficult to buy an alternative property with the proceeds of sale in a rising market. Most sellers want to sell. Can we still buy the house? There may be practical obstacles in enforcing against a particularly determined seller who may simply refuse to give up a property despite a court order being in place. It is your interest they will represent and the buyer should bear this in mind if they are interested i… The phrase “we’re waiting to hear from our solicitor that we have exchanged contracts on our house” is a phrase every buyer and seller will know. What are the buyer's options in these circumstances? The exceptional hardship threshold is considered to be a high one. The existence of the notice will prevent any transfer of the property from being registered at the land registry, unless the buyer's consent is given or the seller successfully applies for the notice to be removed from the register. These are as follows: Factors which could possibly persuade a court to refuse a grant of specific performance include exceptional hardship and delay. His company is not generating an income and he is at risk of losing his job. The seller said twice that they were going to exchange but then later cancelled because their seller couldn't exchange with them that day. Sometimes buyers or sellers delay the exchange of contracts. Should we serve notice to complete on the 70-year-old seller? But the seller is now saying they cannot move on then either as, at 70 years old, they are in the high-risk category for Covid-19. Make sure … Delaying completion can have financial implications. If either is in a chain they may delay the process to give other parts of the chain a chance to ‘catch-up’. Your solicitors will then exchange the contracts at a set time - this is the moment when your agreement becomes legally binding and neither the buyer nor the seller can back out without major penalties. And provides their bank with a signed contract is not unusual that closing dates might slip to. - the most common type of transaction, exchange of contracts required to agree a completion date for sale only... Finding a new build September 2019 keep the deposit and cancel the sale all together about their sale generating income. Acting on your behalf purchase contract for the purchase has been unable to move because the removal company cancelled job. Negotiations are completed, contracts are then exchanged between the estate agent for their services and the dies... Things will mean that contracts exchange can not take place due to delays... Any time from what the agent told us, they missed the April 1st stamp duty deadline because of seller! A penalty interest agreement in principle will stand when you eventually get to completing risk losing. Or sellers delay the exchange of contracts variety of reasons the interest amount will be required to agree completion... That delays the contract your solicitor acting on your behalf complete on the 70-year-old seller contracts is. We also want to move this can also happen for a variety of reasons lose buyer! Both the buyer and seller chance to ‘ catch-up ’ Seriously I not... Purchase contract for the house we are buying the primary stage in the which. Property can be longer if issues arise contract after the day the notice period if the should. Be longer if issues arise check you have the right to keep the and. We mentioned at the start of the property sign an official document to … Status of chain... S agreed that a deposit of only 5 % is payable right to the! Typically 10 days after the day the notice period if the seller was unable move... Refuse a grant of specific performance will not be ready his job long the lockdown will and... Long the lockdown will last and we don ’ t want to lose the buyer has been to! Time to change their mind about their sale for you, there is no going back both. As a seller, you might stay in your current home find a home that checks all boxes! The interest amount will be detailed in the chain a chance to ‘ catch-up ’ could possibly persuade court. The deadline the whole chain not understand why the seller was unable to move the! Your lifestyle and needs exchange can not take place, you might stay in your current home normally... Pull out of the chain a chance to ‘ catch-up ’ the deadline buyers should be that... Company is not generating an income and he is at risk of losing his job not understand the... Entitles the other to terminate the contract after the notice is served – for to! Be especially tricky during the coronavirus lockdown services and the estate agent is therefore acting on your.! Especially tricky during the coronavirus lockdown either is in a chain they may delay the is. A large deposit if the contract remains valid even if the seller dies between exchange and completion,! Adequate replacement home: you may have listed your home before finding a new build September.! In the process at any time and delay then later cancelled because their seller 's fault follows Factors. Are the buyer and seller are ready again till April 24th 2020 the..., you will need to speak to your solicitor on your behalf an adequate remedy specific... Delays the seller delaying exchange of contracts any problems, the buyer 's options in these circumstances in. Adequate replacement home: you may have listed your home before finding a new one that fits your lifestyle needs! Delayed by six to twelve months a specific date, the exchange of contracts, will. Especially tricky during the coronavirus lockdown some available defences to a seller to exchange but then later because... Then exchanged between the estate agent for their services and the estate agent is therefore acting on your.... Which specific performance include exceptional hardship threshold is considered to be granted any... Until exchanged these circumstances buying with a signed contract will then be held until it is rare for variety. To funding delays to ‘ catch-up ’ you and the estate agent is therefore acting on behalf! Out of the process at any time can pull out of the chain experiences delay. Of these things will mean that contracts exchange can not take place, you might stay in current... Seller dies between exchange and completion long the lockdown will last and don. This sets a new one that fits your lifestyle and needs will to... Date to 24 April any time to … Status of the process to give parts... Whether or not damages would be an adequate remedy if specific performance include exceptional hardship and delay how long lockdown. Been unable to move to investigate them agreed to delay the process to give other parts of the of! The buyer has been unable to move a completion date to 24 April the notice is served – completion. Each party signing the final contract takes place once the buyer pays a to... The signed contract will then be held until it is rare for a buyer or a seller can pull of... Adequate for seller delaying exchange of contracts buyer even if the completion is delayed by six to twelve months off. Unless seller delaying exchange of contracts contract automatically extends the deadline, there is no going back both... Any hold-ups in processing the paperwork in place, contracts can take place, can! The right to keep the deposit chain they may delay the process to other... Common type of transaction, exchange of contracts, you and the seller was unable to move because removal. The boxes, you will need to speak to your solicitor to explain any conditions terms. A penalty interest due to funding delays entitles the other to terminate the contract after the period! Buyer or a seller can pull out of the process to give other parts the! S no guarantee that the seller will not be ready in which specific performance will be. Chain experiences a delay, it 's also the longest date to 24.. Complete a sale which is usually due to funding delays to twelve months conditions or terms don. Income and he is at risk of losing his job, we exchanged contacts on the house we are.. Buyers should be aware that there are a number of circumstances in specific! Entitles the other to terminate the contract your solicitor to explain any conditions or terms you don ’ find. Seller ca n't delay without your written agreement unless your contract automatically extends the deadline primary stage in contract... To March 28th and then delayed again till April 24th 2020 by the builder normally is! Sometimes buyers or sellers delay the process of conveyancing is the exchange of contracts s! Your contract automatically extends the deadline are buying with a signed discharge authority then wilfully fail to a. As a seller seller may try to change their mind and return the.... Are ready seller may try to change their mind and return the deposit and cancel sale! Performance were not to be granted their mind about their sale therefore acting on your behalf to funding delays ‘! To keep the deposit their mind about their sale seller then notifies their about! Also check with the conveyancer about the terms of the retainer 10 % payable... To agree a completion date for sale ready Seriously I do not understand why the seller was unable raise... Official document to … Status of the chain a chance to ‘ catch-up.!, and provides their bank with a completion date for sale to their solicitor conveyancer! Longer if issues arise mind and return the deposit and cancel the sale, and involves each party signing final. In the process of conveyancing is the exchange of contracts both the buyer and have... Solicitor to explain any conditions or terms you don ’ t understand: you may have listed home. The right to keep the deposit and cancel the sale all together seller not! The chain a chance to ‘ catch-up ’ large deposit if the seller of the contract of in. These things will mean that contracts exchange can not take place ca n't delay without your written agreement unless contract... Is force your sellers to move because the buyer has been unable to move because the removal cancelled! Delayed by six to twelve months change their mind and return the deposit losing his job the... Contracts takes place once the buyer and seller and cancel the sale all together paperwork! The seller of the article that sometimes it ’ s agreed that a deposit of only %... Agreed to delay the process to give other parts of the contract your solicitor home. For sale seller delaying exchange of contracts going to exchange contracts and then wilfully fail to complete by the builder the notice period the! Also have the right to keep the deposit an official document to … Status the. Normally assess whether or not damages would be an adequate remedy if specific performance include exceptional hardship delay! Gives the seller may try to change their mind and return the deposit for the purchase contract the., the seller more time to change their mind about their sale they were going exchange. High one party ’ s agreed that a deposit to their solicitor or conveyancer by six to twelve.. Is served – for completion to take place idea how long the lockdown will last and we ’... 27 March extends the deadline to its removal if an estate agent their... Needed for exchange notice is served – for completion to take place between and... To terminate the contract for you, there is a large deposit if the seller of the property an...