Unlike other forms of contract which may be made verbally and still enforced, since 27 September 1989, Section 2 of The Law of Property (Miscellaneous Provisions Act) states that;

"a contract for the sale of an interest in land can only be made in writing and only by incorporating all the terms which the parties have expressly agreed in one document or where contracts are exchanged in each."

Therefore, unless ‘all the terms’ of a contract are included in one or two documents and signed and exchanged by the parties privy to that contract, no binding contract for the sale of land can be enforced in England or Wales.

Before 1989 a contract could exist between parties as long as there was a memorandum in writing that contained the terms. This means that it was possible to verbally agree a sale of land as long as the sale terms were agreed in an exchange of letters.

To prevent a misunderstanding and accidentally commit to a sale or purchase before all terms had been properly agreed and all searches, and mortgage offers, etc had been obtained, it was and is still normal practice to head all offer letters and correspondence entered into before formal exchange of contracts as ‘subject to contract’.

Unless otherwise agreed, either party may withdraw from a transaction at any time before the purchase contract has been signed by both parties (or their authorised representatives) and exchanged. At this point a deposit is normally paid in consideration of the agreement and the deal becomes legally binding on both parties in according with the contract terms.

Recent posts

Virgin Money and Hive Energy introduce new "green" mortgage product called Retrofit Boost Mortgage with the aim to help homeowners improve the energy efficiency of their home by offering cashback between £3,000 and £15,000

According to recent findings by LV= where 4,000 UK adults were surveyed, mortgage holders said that were likely to consider equity release to free up some money to take care of expenditures in later life.

Following the recent decision by the Bank of England’s Monetary Policy Committee to cut the base rate from 5.25% to 5% (the first reduction seen in over four years), we have seen lots of lenders reducing their rates to remain competitive.

With August typically being the hottest year of the month, ensuring your garden is getting that extra bit of care is important. Here are some August gardening tips for you to read through - just remember to take the time to sit back and enjoy your garden!
 

Did you know that removing clutter within your home can reduce stress, help you be more productive, and improve your mood and self-esteem? Check out our steps to get you started.

The Equity Release Council has revealed that three in five UK homeowners are interested in releasing money from their property later in life.

The average seller’s asking price dropped by 0.4% in July, a bigger drop than we have typically seen. 

We explore the differences between Millennials and Gen Z and what both generations ideally want from a new home.