A Memorandum of Sale is a legal document that outlines the main terms of a sale between a buyer and a seller. The document is normally used when buying/selling property and it acts as proof of what the seller and the buyer are both agreeing to.
Key things that would be included in the Memorandum of Sale are:
- The identities of the buyer and seller
- A description of the property being sold
- The purchase price
- Any requirements or conditions of the sale
- The date of the sale and the expected date of transfer of ownership.
When during a sale is a Memorandum of Sale created?
The Memorandum of Sale is typically issued after an offer has been accepted by the seller in a property sale process. Once the buyer and the seller have agreed on the terms of the sale, including the purchase price and any other conditions, the Memorandum of Sale is drawn up and signed by both parties.
Why is a Memorandum of Sale needed?
The Memorandum serves as a record of the agreed terms and is used by all parties involved in the transaction, including solicitors, conveyancers, and mortgage lenders. The Memorandum of Sale helps clarify the particulars of a sale so that everything is clear and transparent. It can also help to prevent any misunderstandings or disputes arising later in the property sale process.
Is a Memorandum of Sale legally binding?
The Memorandum of Sale is not a legally binding contract and you can still pull out of a sale after signing it. The document simply outlines the agreed-upon terms of the sale.
A legally binding contract, will usually be drawn up later in the sales process, and will contain more detailed legal terms and conditions.
Whose job is it to create the Memorandum of Sale?
In a property sale process, the Memorandum of Sale is typically created by the estate agent who is handling the sale, although if selling to a fast property buying company, the document is created by the fast property buying company’s solicitor. If selling your property at auction, the Memorandum of Sale will be drawn up by the auction house and you’ll be expected to sign it immediately after the auction.
How long after Memorandum of Sale is the sale completion?
The date of the sale and the expected date of transfer of ownership are normally written in the Memorandum of Sale. If you have a Memorandum of Sale you should be able to find the planned completion date there.
Generally, the length of time between the Memorandum of Sale and the completion of the sale can vary depending on a number of factors, such as the complexity of the transaction and any conditions that must be met, but typically, if using an estate agent, the sale completion date is set for anywhere between a few weeks to a few months after the Memorandum of Sale is signed.
During this time gap, both parties will work to satisfy conditions, obtain financing, complete any home inspections, and resolving legal issues.
If you are using a fast property buying company like Property Rescue, instead of an estate agent, completion will normally happen within just a few days after the Memorandum of Sale is signed.
What is the benefit of selling to a fast property buying company?
Fast property buying companies buy property much faster than estate agents can sell them on the open market.
The reason is because with a fast property buying company the house never goes on the market, there are no chains, there are no viewings, and there’s no need to do up your property before you sell it. Instead, the fast property buying company will simply buy property from you directly with cash!
If you’re interested in exploring whether the fast property buying company option is right for you, just book in a free call with Property Rescue here.