As with many questions lawyers face, the answer is never straightforward. Whilst this question seems to demand a “yes” or “no” answer, the actual answer is “it depends”!
Selling a house involved a contract between the seller and the buyer. In Scotland, that contract must be in writing. This is constituted by an exchange of letters between solicitors (lawyers call this exchange of letters missives). When the buyer and seller agree the terms of the contract, this is usually when missives have been concluded.
At what point in the missives process can you pull out of your house sale?
You can pull out of your house sale without any penalty or costs due to the seller at any point before missives have been concluded. However, if it is your intention to pull out of your house sale, you must check the position with your solicitor.
Missives are often more complex that buyers and sellers might imagine. In their most basic terms, the missives comprise an offer and an acceptance. However, frequently, all the terms of the offer are not acceptable to the seller. When that happens, the seller’s solicitor sends an acceptance to the buyer’s solicitor which contains further conditions. These might be deleting or changing some of the conditions of the offer or inserting new conditions for the benefit of the seller. This is called a qualified acceptance. When the buyer’s solicitor receives the qualified acceptance, they will check with the buyer if the changes in the conditions are acceptable, if they are, a final acceptance is sent to the seller’s solicitor. If not, the buyer’s solicitor will send a further qualified acceptance to the seller’s solicitor. This process can go back and forward for some time until missives are, eventually, concluded.
You should also note that the solicitors will sign the missives on behalf of their client. This process means the exchange of letters that form the contract are binding on you just as if you had signed them yourself.
Why would you want to withdraw from your sale?
There are many circumstances which might lead you to wanting to withdraw from your house sale. For instance, you might have decided to move house because you have a new job in a different part of the country and it is not convenient to commute from your current location. However, if that job were to fall through, then you might decide that you wanted to stay in your current house.
Alternatively, the sellers of the house you had agreed to buy, might decide not to sell it to you. They would be faced with the same kind of quandary that you might have if you decided to withdraw from your sale!
Your mortgage for your new house might fall through or your lender does not offer you enough of a mortgage to allow you to buy your new house. Again, this might give you cause to decide not to proceed with your own sale.
These are just some examples of why you might decide not to proceed with the sale of your house. Everyone’s circumstances are different and there is no hard and fast rule as to why people decide not to go ahead with their sale.
We would stress, however, that decisions not to proceed with a sale are very much in the minority.
Can you withdraw after missives have been concluded?
You can withdraw after missives have been concluded, but there may be consequences for you should you do that.
Sometimes missives can contain suspensive conditions. These are conditions that must be fulfilled before the sale and purchase can settle. If the suspensive conditions are favourable to the seller, then the seller might be entitled to withdraw from the sale without penalty.
If, however, missives have been concluded and there are no suspensive conditions, if the seller withdraws from the sale, the penalties can be severe and very expensive.,
The buyer could insist that you go ahead with the sale. If you refuse, they can raise court proceedings for specific implement. If the buyer is successful, you can be forcefully removed from the house.
If, however, you negotiate a withdrawal with the buyer, they may agree to your withdrawal if you cover their costs and pay them compensation. This is always difficult to do because, invariably, the buyer will also have sold their own house and if you ask them to withdraw from the sale, they will have the knock-on effect of having to deal with the buyer of their house!
What should I do if I decide to pull out of my sale?
The first thing you must do is to speak to your solicitor. It is essential that you do that to find out what stage the missives have reached and what the likely penalties you will face if you withdraw.
Our solicitors have may years of experience dealing with sale and purchase of properties for our clients. If you have any questions about your sale or purchase or are considering moving house and want to know about the process or would like to have a chat about it, please contact us.
