When buying or selling a property, one of the key milestones is the completion date, the day when the sale is finalised and ownership is transferred. However, many people are unsure about the typical completion time for a house sale and how they can potentially speed up the process. In some cases, bridging finance can play a crucial role in accelerating this timeline, making it easier for buyers and sellers to achieve a quicker sale. In this blog, we will explore the typical completion times for house sales and how bridging finance might help.
What is the normal completion time for a house sale?
Various factors, including the complexity of the transaction, the property’s location, and whether the buyer or seller is in a chain, influence the completion time for a house sale. However, on average, the completion of a house sale in the UK typically takes between 8 and 12 weeks. Although delays can occur for various reasons, understanding the typical process can help manage expectations.
The process leading to completion
Before a house sale can be completed, there are several steps involved that contribute to the overall timeline:
- Offer acceptance and agreement: Once a buyer’s offer is accepted, both parties (buyer and seller) will agree on the terms of the sale, and the buyer will instruct a solicitor or conveyancer to handle the legal process.
- Searches and surveys: The buyer’s solicitor will carry out necessary property searches, such as checking for planning permission or any potential issues with the property. The buyer’s solicitor will also conduct a survey to evaluate the property’s condition.
- Mortgage offer and contracts: The buyer’s lender will issue a mortgage offer after the mortgage lender completes its valuation. Both parties’ solicitors will then exchange contracts, which include agreeing on a completion date.
- On the completion day you will give the necessary funds to the seller’s solicitor and hand over the keys to the buyer, thereby officially concluding the sale.
While these stages generally follow a standard process, the length of time they take can vary depending on the circumstances. Factors such as delays in receiving mortgage offers, outstanding issues with the property, or even the complexity of the legal documents can all extend the completion time.
Can bridging finance speed up the completion process?
A buyer can use bridging finance, a short-term loan, to bridge the gap between their purchase and the sale of their existing property. This type of financing can be an excellent solution for buyers or sellers looking to complete a property transaction more quickly, especially when there is a delay or a need for immediate funds.
How bridging finance can help
Bridging finance can significantly reduce the time it takes to complete a house sale by providing quick access to funds that would otherwise be delayed. Here’s how it can speed up the process:
- Avoiding delays in a property chain: A property chain is a common issue that can delay house sales, as each party in the chain is waiting for someone else to complete their sale before moving forward. Bridging finance can help by enabling the buyer to secure the funds needed to purchase their new property, even if their own property sale has not yet completed. This removes their dependency on the sale of their existing home and allows them to move forward without waiting for others in the chain.
- Quick access to funds: Bridging loans are known for their quick approval process, often taking just a few days to arrange. This is particularly beneficial for buyers or sellers who need to complete a sale quickly but are waiting for funds from another source, such as the sale of an existing property or a long processing time from a traditional mortgage lender. Even in the event of a delay in their mortgage offer or other funding sources, bridging finance enables buyers to swiftly secure their purchase.
- Avoiding the risk of losing a property: In competitive markets, homes can sell quickly, and a buyer may lose out on a property if they are unable to complete the sale swiftly. By using bridging finance, buyers can secure the funds needed to purchase the property quickly and without delay, increasing their chances of completing the sale on time and securing their desired property.
- Short-term financing solution: Bridging loans typically have a short repayment period of a few months. This makes them an ideal solution when a buyer or seller needs funds quickly but does not require long-term financing. The proceeds from the primary property sale can repay the bridging loan, allowing the buyer or seller to proceed with their property purchase or sale.
Considerations when using bridging finance
While bridging finance can expedite the house sale process, it’s important to keep in mind that it does come with some costs. Bridging loans usually have higher interest rates than traditional mortgages, and fees for arranging the loan can also add to the overall cost. Therefore, it’s crucial to consider whether the benefits of speeding up completion outweigh the costs associated with the loan.
Additionally, the buyer or seller should only use bridging finance if they are confident in their ability to repay the loan within the agreed timeframe. If the sale doesn’t go through as planned or there are delays, it could lead to financial strain.
Conclusion
The typical completion time for a house sale in the UK is usually between 8 and 12 weeks, although this can vary depending on a variety of factors. Delays can occur, especially in property chains or when funding sources are slow to materialise. In these situations, bridging finance can be an effective tool to speed up the process by providing rapid access to funds and helping buyers or sellers avoid delays. If you’re facing time constraints or delays in your property transaction, bridging finance could be the solution to help you complete your sale and move forward with your plans.
At UK Property Finance, we can provide tailored advice and solutions to help you navigate the complexities of property transactions and secure the funding you need. If you’re interested in exploring bridging finance options, contact us today to discuss your situation.