Memorandum of Sale

17/05/2019
The Memorandum of Sale - also known as a Notification of Sale - can be viewed as a welcome step and rite of passage marking when a seller has accepted your offer as a buyer and is the point when all interested parties initially communicate this and their contact details. It is normally drawn up by the Estate Agent involved in the transaction.

This article therefore examines all matters related to this early - but critical - step in the conveyancing process and examines:


Buying a Property? Use our expert property lawyers, first time buyer specialists

Buying a property is always an exciting time and we're known for working with our friendly, approachable solicitors to ensure that you'll complete your purchase as smoothly as possible from the moment you instruct us and our solicitors are named on your Memorandum of Sale.

* Fixed Fee – No Sale No Fee – On all Mortgage Lender Panels



    1

    What happens before a Memorandum of Sale is drawn up?

As a buyer, you'll have visited many properties and put in offers to buy a few of them. When you put in an offer, it's highly advisable to make your offer 'subject to contract' and 'subject to survey' to protect yourself. When a seller/vendor accepts your offer - congratulations! - they immediately inform their estate agent who then draws up the Memorandum of Sale.

Who draws up the Memorandum of Sale when there's no estate agent?

In situations such as a private sale, where there is no estate agent, then the seller draws up and distributes the Memorandum of Sale.

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    2

    When is a Memorandum of Sale issued?

The Memorandum of Sale is drafted by the estate agent once the seller/vendor has told them that they've accepted an offer.

The seller will already have provided the estate agent with the name and contact details of the solicitor they have chosen for their conveyancing. It simply remains for you as a buyer to instruct your solicitor in turn and your solicitor normally then contacts the estate agent, using the information you've given them.

You can, of course, provide this information to the estate agent yourself or, if you're using an introducer, they will call the estate agent on your behalf.

If you are buying with a mortgage, your solicitor will also provide your mortgage advisor 's details.

Buyer? Do you have to use the Estate Agent's recommended solicitor?

The Estate Agent should never try to convince you to use their solicitors on the back of or in connection with any Memorandum of Sale, not least because there's a potential conflict of interest and other possible abuses might result, plus also, the Estate Agent invariably gets a kick-back from their solicitors, which you, of course are paying for.

If you wish to know more, please read this article Forced into Using Estate Agent's Solicitors




    3

    What details are on a Memorandum of Sale and to whom is it circulated?

A Memorandum of Sale typically contains the following details:
  • Name, address, telephone number and email address of the vendor/seller
  • Contact details for the vendor's solicitor
  • Your name, address, telephone number and email address and also details of whether you are buying the property with cash or a mortgage
  • If you're buying with a mortgage, then your mortgage advisor's/broker's details should also be listed
  • Contact details for your solicitor
  • Tenure (Freehold/Leasehold/Share of Freehold or even Commonhold) and details of lease if relevant
  • Details of any property chain involved (click to find out more about this subject)
  • Details of any special conditions or other remarks (more on this below)
The relevant estate agent (or, as explained, the seller if there's no estate agent involved) circulates the memorandum of sale to all the parties named on the document (you, your solicitor, the seller, the seller's solicitor and, if applicable, your mortgage advisor/broker).

What does a Memorandum of Sale look like?

Click on Memorandum of Sale example UK to view an example of one which created for you.



    4

    How long does it take to get a Memorandum of Sale?

This will entirely depend on the estate agent who has been instructed to sell the property.

Typically, it will be prepared within a few days of a sale being agreed. However, it can take longer, especially one of the parties does not yet have certain details available (such as they are yet to appoint a solicitor).

You may also need to allow extra time for the document to be received in the post since not all estate agents send them via email.


    5

    What happens after a Memorandum of Sale is distributed?

Once the memorandum of sale has gone out, the conveyancing process progresses as normal with all parties knowing the identities and contact details of the others for as and when they need to communicate.

As a buyer, you'll have to provide your ID  and also your proof of funds to your solicitor and it's your responsibility to provide information for your solicitor to examine regarding the suitability of the property you're looking to buy.

This includes booking a house survey (which is different from your mortgage survey if you're buying with a mortgage (click to find out more) and providing your solicitor with the report and paying for searches which your solicitor also examines (you always have to get searches if you're buying with a mortgage but it's recommended that you do so anyway).

Your solicitor will also receive lots of information about the property from the seller via their solicitor (property information, contract, fittings and contents form, warranties and material related to the freehold if it's a leasehold sale). You'll have to book your mortgage survey and await the result of your valuation. Your solicitor, as information comes in, raises enquiries about any matters they feel they need further information about regarding the property and also awaits your mortgage offer. Once they have all this, they'll summarise their findings - called a Report on Title - which they'll return to you for signing, then you're ready for the next big stage, exchange of contracts and eventually, all going as planned you'll move to final completion .

Your seller has plenty to do to start with: they'll have had to fill out all the property information forms and forms related to fittings and contents as well as any warranties. The seller's solicitor will also have to produce a title plan, an official copy of the register (which is effectively what used to be called a Title Deed) and if applicable a copy of the lease. Once they've provided all the information to your solicitor via their solicitor, they may also have to help their solicitor answer any enquiries which your solicitor may make, as referred to previously. When these have been exhausted (enquiries) and a buyer is happy to move to exchange of contracts, the seller's solicitor will exchange contracts with the buyer's solicitor on a pre-agreed date (and electronically in the vast majority of cases).

Please note however that the seller doesn't have to remove the property from the market following an accepted offer and the memorandum of sale going out. It's only when you exchange contracts that the contract for sale becomes legally binding.


    6

    Is the Memorandum of Sale a legally binding document?

The memorandum of sale is not a legally binding document but it does formally mark the point when your seller has officially accepted your offer and you and your solicitor can progress with the next steps towards buying the property in question. The process gets fully formalised when contracts are exchanged and finishes on completion. Up until then, either you or the seller can pull out of the transaction without penalty.

Additionally the seller's solicitor will generally only draft the essential contract for the sale once they've received the memorandum of sale.


    7

    What are Memorandum of Sale Special Conditions?

Special conditions, as briefly referred to and which appear on our template example, might include, for example, any remarks that deviate from the standard conditions of sale, including planning restrictions and specified rights concerning the land.


Buying a Property? Use our expert property lawyers, first time buyer specialists

Buying a property is always an exciting time and we're known for working with our friendly, approachable solicitors to ensure that you'll complete your purchase as smoothly as possible from the moment you instruct us and our solicitors are named on your Memorandum of Sale.

* Fixed Fee – No Sale No Fee – On all Mortgage Lender Panels



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