Dataplex has many ways to meet the needs of home sellers and buyers
in the current UK property market.
There are a variety of “Buying methods” that can be used, and each
has specific advantages given specific circumstances of the Seller.
Using Delayed Completions is a very attractive way of transacting
property sales and purchases. Essentially, as the name suggests, it involves an Exchange with the Completion of the
transaction occurring at a later date. This allows flexibility in the transaction for both the Buyer and
Seller.
The Advantages
Sellers perspective:
Speed It is possible to sell a property very
quickly using a Delayed Completion sales contract. A mortgage is not required at the Exchange. The Buyer can
“Babysit” the existing Mortgage until the sale Completes.
Above Market Price Sale It is possible to
sell your property at a higher value than the current market price. As the actual Completion will occur in the
future, the buyer can raise the required mortgage based on the future market value of the property. For sellers
with no equity, this can be a great advantage.
For Sellers who have a lot of equity, this can also be a great way
to maximise the value of their property as an Investment. They can Participate in future appreciation whilst taking
up to 75% of their equity out to invest in another property.
No Ongoing Costs After Exchange, the Buyer
undertakes to look after all the maintenance and outgoings on the property. These include, Mortgage payments on
behalf of the Vendor, Council Tax, Buildings Insurance, Maintenance. The Buyer agrees not to make any structural
alterations to the property, or carry out any modifications without the prior consent of the
Vendor.
Motivated Buyer Purchasing a property using
the Delayed Completion method allows the Buyer to enjoy the benefits of Home Ownership while they save for their
deposit at Completion. They take very good care of “their home”. All payments are made on time as to default would
risk losing their property.
Investors Perspective:
Lower Risk Delayed Completion allows an
Investor to Exchange on a property now and Complete at some time in the future. The time at which Completion occurs
can be set to coincide with certain market conditions, such as the fair market value reaching a certain
level.
No Mortgage Required As the Vendor remains on
the Title until completion, the Vendors Mortgage remains in place until the Sale Completes. The Investor / Buyer
undertakes (Contractually) to manage the property and look after the mortgage until such time as the sale
Completes. The Vendor grants the Investor / Buyer a License to Occupy the premises after the
Exchange.
Buyers Perspective
Buy Without Full Deposit Most home buyers
need a minimum deposit of 20%. A Buyer can source property from Property-Foundations at a 5% deposit. If they have
a good income, they can afford to buy a more expensive property with the deposit they have. By the time Completion
is due, they’ve had 3 – 7 years to accumulate the deposit and credit history needed to raise the
mortgage.
About US
Dataplex buys property using Delayed
Completions. We work with Agents, Vendors and Buyers.
When an Agent is involved, they normally receive their commission
at Completion. As the Completion may be some years away, we undertake to cover this at the stage of Exchange, on
behalf of the Seller.
With Buyers, we help to ensure their circumstances allow them to
fund the deposit and monthly “Rental” payments.
We raise the purchase documents with the Seller and take
responsibility for the ongoing Management of their Property and all the associated costs. If we have specified a
Completion date based on the property reaching a pre-agreed market value, we initiate the Completion between
ourselves and the Vendor and then ourselves and the Buyer.
The Legal Aspect
This method of Selling a Property has been used extensively in the
Commercial Estate market. It has been widely used abroad and now is being used in the UK. At this stage, not many
residential property solicitors are familiar with Delayed Completions. When we enter into negotiations using this
type of buying method, we will recommend that your Solicitor speaks to one of our panel Solicitors who are happy to
cover the Legal elements with them
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