After exchange, most buyers and sellers feel that they can rest assured that the procedure will continue through to completion. Nevertheless, there is of course the possibility that either buyer or seller will fail to complete a contract for the sale of a house. It is in fact far more common for buyers not to complete, though sellers can frequently find themselves in this predicament too. You may therefore be wondering what happens if you do not complete after exchange of contracts. In this article we will be giving you a run down of the potential consequences you may end up facing, should you not complete after exchange.
What happens if you do not complete after exchange of contracts?
If you fail to complete after exchange of contracts, this means that you will be in breach of contract. Thereafter the seller has the option to revoke the contract as you will have been unsuccessful in serving a notice to complete. If the contract is then not completed, the buyer has the option to forfeit their deposit. On the flip side of the coin, the seller can take legal action to enforce the contract.
What does it mean to sign a contract?
Regardless of the side of the contract you are on, the sale or purchase of any property means that you are entering into a legally binding contract. However, if you do not complete after exchange, this essentially means that you have failed to complete the purchase of your new home on the agreed completion date. This could result in you ending up in a great deal of trouble and surmounting additional costs.
What are standard contract conditions?
Most contracts for buying a house in the UK have standard conditions included in the contract. Standard contracts usually comprise a clause whereby if the buyer fails to complete after having served a notice to complete, the seller may revoke the contract. If the seller invokes this clause, the buyer has the choice to forfeit their deposit. They may also forfeit any accumulated interest, both of which will be paid to the seller.
The main point
Purchasing or selling a house is a big deal, regardless of what side of the contract you are on. Once you exchange on your sale or purchase you are entering into a legally binding contract. Buyers and sellers should ensure that they have the time necessary for their finances to be put in place to avoid being in a predicament where they do not complete after exchange.
The financial consequences, time and stress created if you do not complete after exchange are immense. It is therefore vital to take this into account before making a commitment as large as buying or selling a house. FastCash4Houses will always be here to give you advice and support you every step of the way to making your dream sale or purchase of a house your reality. Get in contact today to find out how we can support you.
