MEMORANDUM OF SALE- ALL THAT VALUERS NEED TO KNOW

A memorandum of sale is a document that is created once a sale has been agreed on a property. It’s not a legally binding document but it does set out the agreed price and declares the intention of both the buyer and seller to complete the transaction.  A memorandum of sale is a legal document that records the details of a sale of a property. It is used to record that the sale of a property has been agreed upon between buyer and seller subject to contract. It will contain as much relevant information as possible, including:

• The address of the property
• The agreed sale price
• The names and contact details of the seller and buyer
• Contact details of the solicitors representing the seller and buyer
• The HMRC Land Registry number
• Expected dates for exchange and completion
• Information about the property, such as whether it is a freehold or leasehold
• Any special conditions agreed as part of the same, for example, a sale at a specified price subject to certain repairs being made

A memorandum of sale acts as written evidence that an offer has been accepted, as well as recording the amount of money that will be paid. It is a contract but it’s not legally binding. It’s a preliminary measure to set out the terms of agreement before parties have to legally commit. However, it is still an important document. As soon as it is issued, the necessary arrangements to complete the sale of the property can be made. It also plays a vital part in the later surveying of the property because it contains so many details about the house. This could include things like subsidence, a major factor that can determine whether a sale actually goes through.

Important details are on a Memorandum of Sale

• The address of the property being sold and the agreed purchase price.
• The contact details of the vendor + a contact address if the property being sold is not their main place of residence.
• Full contact details of both the buyer and seller’s solicitor. Because we pay all your legal fees this isn’t something you need to worry about unless you choose to do your legal privately.
• Expected dates for exchange and completion.
• Proof that ownership of the property has been checked with HM Land Registry. This can include a HM Land Registry number.
• Specifics on the property include its tenure and the length on the lease (if applicable).
• Any special conditions agreed as part of the sale. For instance, a sale at X price on the basis that the roof is replaced or certain fixtures and fittings remain.
• For auction sales, additional details may need to be provided.

Importance of Memorandum of Sale

Having a Memorandum of Sale enables all the key information to be in one place. A huge amount of unnecessary time is saved in the ‘to-ing and fro-ing that comes with selling a house. Once the sale has been confirmed, the agent should get the document circulated as quickly as possible.  This means the sale can proceed quickly and efficiently.  We also recommend producing a Memo (using the template above) even if you’re selling privately. It’s not a complete confirmation, nor is it legally binding. Whilst the buyer can still withdraw from the sale, as long as things are kept honest and transparent from the start, this shouldn’t happen.