The current situation with Covid-19 and the lockdown have created an extremely worrying climate for people buying and selling homes. It has added a considerable amount of stress and ambiguity which, in turn, is creating complications for conveyancing.
The Law Society has stated that where possible people should delay completion until the lockdown has been lifted. However, if you have already exchanged, what do you do?
If you have exchanged then within that contract the completion date is set. If you fail to complete on this date (even if you have failed to do so due to the virus), it could still mean that you have breached the contract.
To avoid this, we would advise renewed negotiation to try and agree a new completion date by varying the original contract. Both parties would have to be in agreement to achieve this but it would prevent the contract being breached.
Whilst the completion date is set in the contract, if one party fails to complete but the other party is ready, then they will issue a Notice to Complete. This is a formal written notice that explains that they are ready even though you are not. You will then have ten working days to complete and if you fail to do so then the deposit could be forfeited and losses could be claimed.
However, this of course is something any conveyancer would try to avoid.
If you haven’t exchanged yet and you decide to go ahead with the date for the lifting of the lock down being unknown, then you have to consider there will be risks. Completion may not occur for various practical reasons such as:
To try and avoid this we would suggest that you exchange and complete on the same day, that way you will know on your moving date that the chain is in fact ready.
This does bring the risk of an unknown completion date but it protects against the possibility of a breach.
Another option is to agree a clause in the contract that deals specifically with a delay in the completion date due to the virus. Again, like any suggestion, all parties would have to agree to this. The Law Society has asked that if you do move you must still adhere to the guidelines such as social distancing which creates countless problems in its own right.
This is of course, an unprecedented situation and there are many issues arising which can require complex solutions. If you are buying or selling your home and have concerns, then Raworths can guide you through this difficult time whilst helping ensure you suffer the minimum amount of disruption.
Contact our residential conveyancing team, led by Kelly Buckle-Fleming, for more information on 01423 566666 or email Kelly Buckle-Fleming