Government tells conveyancers to delay completions

Mortgage offers: Lenders to extend their validity

Conveyancers should continue to support the sales process “as far as possible” but look to change dates of completion during the lockdown, the government said yesterday.

The Ministry of Housing, Communities and Local Government also revealed that lenders are set to extend the validity of their mortgage offers to people who have already exchanged.

The ministry has published detailed guidance to back up the statement issued on Wednesday encouraging home buyers and renters to delay moving to a new house if possible while emergency measures are in place to fight coronavirus.

The overall message was that parties involved in home moving should “adapt and be flexible to alter their usual processes”.

While there was no need to pull out of transactions, it said “we all need to ensure we are following guidance to stay at home and away from others at all times”.

In relation specifically to conveyancers, the ministry said they should support the sales process as far as possible while ensuring clients were aware of the difficulties of completing transactions in this period. Specifically, they should:

  • Continue to support the sales of unoccupied properties as far as possible;
  • Make every effort to support clients who are due to complete on occupied properties in the stay-at-home period to change this date;
  • Advise their clients who are ready to move not to exchange contracts on an occupied property unless they have made explicit provision for the risks presented by the virus; and
  • Prioritise support anyone with symptoms, self-isolating or shielding from the virus and those they are in chain with, and we urge them to do all they can to help a new date to be agreed in these circumstances.

The guidance makes no reference to the best approach to completion where it is necessary, for whatever reason, but as we reported yesterday, simultaneous exchange and completion is becoming increasingly popular.

The ministry said UK Finance has confirmed that, to support customers who have already exchanged contracts for house purchases and set dates for completion, all mortgage lenders were “working to find ways to enable customers who have exchanged contracts to extend their mortgage offer for up to three months to enable them to move at a later date”.

If a customer’s circumstances changed during this extended period, or the terms of the house purchase change significantly, and continuing with the mortgage would cause house buyers to face financial hardship, “lenders will work with customers to help them manage their finances as a matter of urgency”.

For those who have yet to put their house on the market but are thinking about selling, the government said they could use this time “to start gathering together all of the information you will need to provide to potential purchasers”.

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