How To Stop Your House Chain Collapsing

While there is no fool-proof method for making sure the chain you're in doesn't collapse there are certain precautions you may wish to take:

Check That Your Estate Agent Has Done Their Job

Your agent should be confirming chain details whenever a buyer puts in an offer. If the buyer is selling a property your agent should call their estate agent to check the position of the person who is buying it and the offer amount.

They should also be getting proof of funds from the buyer which shows they have the deposit they need and a mortgage agreement in principle where applicable, or proof of full cash funds if a cash buyer.

Sellers should be aware however that where the buyer requires a mortgage these checks can only guarantee that the buyer has seen a mortgage advisor who would in theory be willing to arrange lending. If the person who does the mortgage valuation finds any reason not to lend against the property, then either the buyer finds another lender or the sale collapses.

Likewise, where the buyer is funding the whole purchase with cash, the agent can only check that they have the funds readily available. If the buyer then decides that actually they would prefer to get a mortgage then either the seller agrees to the inevitable longer timescale for completion or the sale collapses. It can be very frustrating for sellers and agents when, quite far down the process the buyer springs it on them that they will be getting a valuer round.

Setting a Deadline for Exchange and Completion

This is a standard condition of sale for repossession properties but less often used for regular sales. The obvious advantage is that it aims to keep things moving to a tight timeframe, often set one month after an offer has been accepted and solicitors instructed. There is a certain element of 'call my bluff' about it - what happens when the deadline arrives depends on which party is more desperate for the property to complete.

Keeping your Property on the Market until Exchange

Sometimes used to create a sense of urgency in a buyer - after all they risk losing money spent on solicitors and mortgage valuers if they drag their heels on a purchase only to lose out to another buyer.

It's also a way for the vendor to protect themselves against the collapse of a sale. We had a vendor in Stanley recently whose property was supposed to complete but at the last minute the buyer's buyer pulled out. Our client's buyer was able to accept an offer from a new buyer quickly but essentially the process had to start from scratch on his side, meaning our client had to cover the costs of an empty property for much longer than he'd anticipated. So the second time around our client decided it was prudent to keep the property on the open market so he wouldn't miss out on potential buyers who weren't part of a chain or who might put in a higher offer

Move into Rented Accommodation on Completion

Simply put, if you have no upward chain there are fewer complications and less potential for the chain to collapse.

Only Accept Offers from First Time Buyers or Cash Buyers

As above, if there is no downward chain then fewer things are likely to go wrong in the selling process. However, you are limiting your pool of buyers.

Related Articles

Property Chains - What Can Go Wrong?

Published on 16 September 2015

Source Trinity Sales Wakefield

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