1. Simultaneous Exchange and Completion
You may read about this a lot in property press. A Simultaneous Exchange and Completion (a SIM) is when all parties in the chain will agree a date for the exchange and the completion to happen.
Usually, we recommend that there be at least one to two weeks between and exchange and a completion.
With a SIM, both happen at the same time. The pros to this are that the property hasn’t exchanged until the day, so there is no contract in place and it can easily be changed and moved based on various circumstances.
There are risks to a SIM as clients do not have the benefit of an exchanged contract before the moving date, meaning that the other parties in the chain could drop out at any time. Also, if a client has booked removals and the SIM does not go ahead, they may be liable for the costs of this should the company not be able to change the date.
The benefit of a SIM is that if for any reason the client or another party cannot move on the planned date, then they are not liable for any costs or risking a deposit as no contract has exchanged.
If SIMs are well-planned with all lawyers in the chain, then they can happen smoothly and may be the right choice for you.
2. Exchange On Notice
This is a frequently used method in conveyancing, particularly with new build properties. When contracts exchange instead of a having a fixed completion date, completion can be agreed on “7 days’ notice” as an example, meaning that if lockdown measures prevent a move, the completion date can wait until all parties are ready by giving 7 days’ notice.
Conveyancers can also limit this with a long stop date. So, for example “7 days’ notice but no longer than January 31 2021” and we would seek for the contract terms to ensure that if completion did not happen by the longstop date that no costs are incurred.
This puts the contract for sale in place and sets our clear timelines that everyone agrees with but leaves flexibility there should circumstances change, such as self-isolation.
It is also worth noting that if the move cannot happen by the long stop date, contracts can be reissued and this date can be changed – the nature of these types of exchanges are that they are very flexible and useful for those moves that have much longer chains.
3. The Covid Rider
A Covid Rider is a clause that is added in to the contract of sale and must be included in every contract in the chain if it is to be enforceable.
The Rider would be placed within the contract if the client would like a traditional exchange and completion and protects them should there be any Covid-related circumstances that mean that they cannot move after completion.
As mentioned, the clause must be added to every contract in the chain otherwise it is not enforceable and if the property move were to fall through after exchange, deposits would still need to be paid.
What can agents do to progress their pipeline during lockdown?
• Be patient with clients and become educated with these options - try and steer clear of pushing for a traditional exchange as this could panic clients who then may withdraw. Help manage their expectations, especially when it comes to timelines.
• Be positive when talking about client options – home moves can go ahead and we have the steps in place to protect them. Best practice is to outline all the options and let clients chose a course of action that is best for them.
• Recommend a conveyancer who has a proven track record of successfully progressing transactions in a lockdown. At Simply Conveyancing, we are completely Covid-secure with innovative technology and the best lawyers that will ensure your clients move home quicker.
• Information gather – informing the acting solicitor of all the chain information is really helpful as it means that close contact can be made. If you’re referring solicitor can act on both sides of the transaction, as we can do at Simply, encourage this as it can lead to a quicker exchange.
We are always available to support both clients and estate agents. For more information about how you can partner with Simply Conveyancing, visit our website or get in touch with me on email@example.com.
*Vicky Quinn-Campbell is Sales & Marketing Director at Simply Conveyancing