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Coronavirus: Leading law firm recommends clients go for same-day exchange and completion

Agents have reported that national legal firm O'Neill Patient is advising clients to adopt the tactic if they are worried about a sale falling through.

Nigel Lewis

A leading national conveyancing firm has revealed that it is recommending to vendors and buyers that they exchange and complete on the same day due to the Coronavirus crisis.

Stockport firm O’Neill Patient has confirmed to The Negotiator that it is recommending the tactic if clients are worried that their buyer or other players in the chain are at risk of withdrawing due to the virus.

“If clients are worried that their sale might fall through because someone in the chain might self-isolate or catch the virus, then one option we are suggesting they take is to exchange and complete on the same day,” a spokesperson said.

But industry consultant Andrew Stanton says O’Neill Patient’s approach has inherent risks for estate agents facing a huge dip in sales activity following the Coronavirus crisis.

“Putting chains under pressure by encouraging same-day exchange and completion will put agents, other conveyancing firms and buyers/sellers under huge pressure at a time when they’ve got a lot on their plate,” says Stanton.

“It’s hard enough for movers to find a removal company at the moment, never mind get all the paperwork lined up.

“Most estate agencies have a pipeline of between £80,000 and £120,000 and as the sales market shuts down, so they’re relying on this money to pay the bills for the meantime.”

Exchanging and completing on the same day is not a normal tactic within the sales process; only 10% are completed this way while the rest usually take between one and two weeks to reach completion.

But most conveyancing organisations don’t recommend it – for example Reallymoving.com advises buyers that it can be very stressful if paperwork doesn’t arrive on time, money gets stuck between solicitor’s bank accounts or there are search delays or last minute mortgage issues.

Also, some mortgage lenders stipulate a minimum period between exchange and completion.

“Recommending that clients go for a same-day exchange and completion is a perfectly normal strategy in these sorts of unusual circumstances,” an O’Neill Patience spokesperson said.

 

 

March 23, 2020

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