Buying A House In A Chain
(Last Updated: 27/02/2023)
01/11/2017
34
5 min read
Key Takeaways
- A property chain is a number of linked conveyancing transactions that are all reliant upon each part of the chain to complete. For this reason, the conveyancing process might take longer than usual.
- A house chain taking too long can be frustrating, but if you manage to find the cause, you might be able to speed up the process.
- As a last resort, you can break the chain and pull out of the transaction. If your chain collapses, however, you should make sure you are covered by a No Sale, No Fee policy.
Chains can come in any number of sizes, from a small chain where a first time buyer is buying from a buy to let investor, to a long chain where there are several families all moving on the same day. Buyers and sellers often worry about their chain collapsing and how best to manage a long chain.
Moving home when there are two people in a chain is stressful enough, however, when there are multiple people, just one slow party can have a ripple effect up and down the chain. This is why it is so important to know how many people are in your chain and find out their circumstances.
How does buying a house in a chain work?
The conveyancing process follows exactly the same route regardless of how long the chain is. What does change is when you should complete certain stages.
If you are at the bottom or in the middle of a chain, you don't want to pay for property searches or mortgage valuation if your seller, or the seller's seller have yet to find a property to buy.
The reason for this is because if the chain isn't complete, then you could be left waiting whilst the sellers find a property to buy. You could even be left financially out of pocket if the seller decides to stay put because they can't find a property to buy.
The best advice is to mirror the chain, which means that you order your property searches and mortgage valuation when your buyer does.
Whilst you are waiting, you should check to see the average turnaround times for your local authority to get the results back for your property searches, and with your bank for them to book in their mortgage valuation (if either of these take 3 to 4 weeks then you may have to order earlier than the rest of the chain).
Is the house chain taking too long?
You are limited with options when you are stuck in a slow chain. The key thing you need to do is find out the cause for the chain being slow and whose property it relates to. Is the issue a:
- problem with the legal title?
- slow solicitor (holidays or overworked)?
- undervalued property?
- renegotiation between the buyer and seller?
- change of heart?
You'll need to find out what the issue is to know how to address it. You should flag your concern with your estate agent so that they can communicate with the estate agents in the chain to help understand what the delay is. This can be a challenge if you are using an online estate agent.
What happens if the chain can't agree on a completion date?
You should agree a target date for completion with your chain at the outset, however you must be flexible as completion dates often move.
How do you break a chain when buying a house?
Breaking a chain is a last resort for sellers and buyers and is normally caused by the loss or delay to their onward purchase.
By breaking the chain you are looking to complete the sale of your property to your buyer and moving into temporary accommodation, with the goal of finding another property or completing at a later date with the existing property.
What about second home stamp duty?
Second home stamp duty is not payable if you are selling and buying your main residence. If you sell your main residence and own another property, then you still don't have to pay second stamp duty as long as you buy your main residence within 36 months.
You should consult the HMRC to find out your own stamp duty liability. You can find out more about this, as well as calculate how much you're liable to pay here - Stamp Duty Calculator.
Frequently Asked Questions
COLLAPSING
NO-CHAIN
FEES
Written by:
Andrew Boast
Andrew started his career in 2000 working within conveyancing solicitor firms and grew hands-on knowledge of a wide variety of conveyancing challenges and solutions. After helping in excess of 50,000 clients in his career, he uses all this experience within his article writing for SAM, mainstream media and his self published book How to Buy a House Without Killing Anyone.
Reviewed by:
Caragh Bailey
Caragh is an excellent writer and copy editor of books, news articles and editorials. She has written extensively for SAM for a variety of conveyancing, survey, property law and mortgage-related articles.
