A memorandum of sale is a document that records the amount of money being paid for the property. It includes the names of both the property seller and buyer, and the name of the solicitors dealing with both parties involved.
While a memorandum of sale records the intention of the buyer to purchase the property, it does not mark the final signing of contracts for a house. Instead, it represents the ‘sale agreed’, subject to the legal contract.
It can be useful to think of it as the paperwork associated with the ‘Sale Agreed’ sign, rather than the ‘sold’ sign placed outside a property on the market.
What does sale agreed mean?
Sale agreed, ultimately, means that the buyer has committed to buy the property for an agreed price, however, because contracts have not been exchanged at this point, both the buyer and the seller still have the possibility to change their minds. Either parties can pull out of the deal up until the point of signing the contract for buying a house.
If you are still unclear about the difference between a memorandum of sale and the exchange of contracts, here is a step by step guide to buying a house from the team at Quick Move Now:
1. Get your home valued
It is worth having a few valuations done on your home by different estate agencies, it is also important to do your research about other properties selling in and around your area.
2. Work out how much moving house will cost and have your Agreement in Principle in place if you are buying a property
It is highly important to work out the costs of moving home as accurately as you can at this stage of the house buying process so that you don’t need to pull out later down the line, or worse, lose money from not being able to complete the sale.
Having an Agreement in Principle in place before putting in an offer on a property will speed up the property buying process and reduce the risk of house sale fall through.
3. Make sure you have an Energy Performance Certificate (EPC)
Your estate agent may organise this for you, however, you must ensure you have an EPC when your property is on the market.
4. Put your house on the market and prepare for viewings
There is no set amount of time as to how long this stage of the property selling process takes. Although the general amount of time it takes to sell a property is 12 weeks, there are many factors influencing this, including if your home is included in a property chain, how popular your property is with the buyers and how much you are willing to accept for your property.
5. You’ll then need to accept an offer once you are happy with it.
6. After accepting the offer, instruct your conveyancer.
Your conveyancer will start the buying process when instructed.
7. The memorandum of sale.
Marks the ‘sale agreed’ stage of the property buying process.
The buyer of the property will take care of the surveys on the property, this will probably be organised by their conveyancer.
9. Contact your mortgage lender
Your mortgage lender will want to carry out their own valuation of the property to ensure their money is being lent wisely.
10. Draft Contract
A draft contract will be drawn up by the property buyer’s solicitor.