Missives – The Complete Guide
Steeped in history and tradition, Scotland’s property market is known for its unique legal process that governs the sale and purchase of properties, and one part of that process is missives. What is a missive, though, and what is their significance in the world of Scottish real estate? How do missives impact buyers and sellers alike? This blog is your comprehensive guide to understanding missives and how they shape the landscape of Scottish property ownership.
The Meaning Of Missive
To begin, it might help to understand the answer to the question “What are missives?” Just what does missive mean in terms of Scottish real estate? It may help to think of how communication typically happens between solicitors during the process of buying or selling property. In most cases, it happens in writing to document all of the details surrounding the transaction itself. The legal system uses the term missive, meaning the written communications that occur between those solicitors. It is important to understand that missives are an essential part of property transactions in Scottish conveyancing law. Not only are they written communications, but experts also use the term missives meaning a part of the legally binding contract that happens when there’s the sale of any kind of property like a home or even just a lot.
What Does Missive Mean In The Wider World?
According to the Oxford English Dictionary, a missive is just a long or official letter. The term originated in the Latin word mittere which meant “to send,” but it’s been part of the English language since the 16th century.
The Process Of Missives
After the buyer in a real estate transaction sends an offer to the seller’s solicitor, the process begins to work. At that point, both the buyer’s and seller’s solicitors begin exchanging formal letters. The goal here is to find a position that is agreeable to both parties so the sale can move on to the next stage, but for it to work, there have to be a minimum of two letters. That’s rarely an issue, though, because, in many property transactions, there are plenty of written exchanges. After all, there are often nuances and complexities that have to be addressed before either party can move forward.
That first formal letter in the missives series is the offer letter itself. It typically contains several things like the conditions, the rights, and the obligations necessary for the sale to move forward.
Once the seller’s solicitor has that letter, he or she will discuss it with the seller, and if they accept the sale (with those terms in place), the seller’s solicitor sends a reply letter that they would like to proceed. If this occurs in this manner, it’s considered to be a “straight acceptance.” Essentially, a legal contract has just been formed between the two parties based on the terms of the letter alone, so the sale can move forward as quickly as possible.
A straight acceptance, though, isn’t the traditional case. Usually, the seller’s solicitor has to send back a “qualified acceptance” where the seller has agreed to some of the terms but turned down a few others. In most situations, there will be further conditions added to that.
In the event of a qualified acceptance, the buyer’s solicitor and the buyer discuss those terms, then either agree to them or further exchanges of qualified acceptance letters take place. Often the letters themselves aren’t the only communications that occur in these settings. Instead, face-to-face meetings are also generally required, and sometimes phone conversations or online meetings are held to help iron out the terms.
As many qualified acceptance letters as necessary can go out in this process. The goal is for the solicitors to arrive at a point where final acceptance letters show the mutually agreed on terms. At any point during the exchange of the qualified acceptance letters, either party can pull out. No legal arrangement has been made yet.
What Components Create Missives?
While missives are unique to the Scottish legal system and conveyancing within Scotland, they could be compared to the exchange of contracts that so often happens across the UK. Missives typically contain the details of the two parties involved in the transaction, the property’s address itself, the purchase price, the date of completion, any sale conditions like the mortgage offer or pending survey results, and any standard conditions that may apply should one party decide they do not wish to proceed with the sale. It’s important to understand that missives do not require signatures. They don’t even have to be witnessed by anyone. Instead, the solicitors may sign the letters, but that doesn’t necessarily have to be part of this document.
There are several standard clauses that are usually with the offer. This usually includes all of the fixtures and fittings and any notes about special circumstances that may affect the property. Reports are typically attached, as are proposed development notifications and statutory notices. Any disputes or litigation must be attached as well. If new home warranty schemes are applicable, those will be attached.
What Happens After Missives?
Once the acceptance letter from the seller’s solicitor is received, the buyer’s solicitor begins to review the paperwork related to the property. This often includes things like title deeds and Land Certificates. It may also include any legal reports. Additionally, the solicitor begins the process of conveyancing searches. Often enquiries outside of missives are made to the seller’s solicitor to ensure there are no concerns regarding encumbrances or property defects.
That complete, missives are concluded. Is a solicitor’s letter legally binding at that point? Absolutely. The Law Society of Scotland says that once that final agreement has been made, a legally binding contract between the two parties exists. If there is a breach of contract, fixtures and fittings are included, it will take place after missives are concluded because they make the contract itself.
It’s important to note, though, that some missives do contain conditions that protect the buyer in certain situations. These situations may include mortgage offers falling through, property values coming back lower than expected, serious property survey issues, chain breaks that make the transaction impossible to complete, the uncovering of dampness or subsidence, delays in planning consent, or the discovery of unexpected legal proceedings. If the sale collapses as a result of one of those, the property is often withdrawn from the market.
The Timeline To The Conclusion Of Missives
Wondering just how long it takes to conclude missives? If there’s a straight acceptance or close to it, missives could be concluded in a matter of days. In the event things become more complex, though, like if there are title issues or restrictive covenants, things begin to take a bit longer. Often just talking to your solicitor will help you better understand what the timeline looks like for your particular situation.
How Does A Mortgage Work With Missives
After pre-missives have been completed and a verbal offer on the property has been made, the buyer’s solicitor will typically advise the buyer to obtain a mortgage offer. The mortgage lender issues the offer, and if the buyer is happy with it, the solicitor can usually be instructed to conclude missives at that point. No buyer’s solicitor will typically conclude missives without a firm mortgage offer.
Toward the end of the process, the buyer’s solicitor forwards a completion statement that includes the purchase price of the property, the deposit required, the conveyancing fees costs, the Land and Buildings Transaction Tax, and any other costs to the seller’s solicitor. Money laundering requirements checks will happen to make certain the source of the money is legitimate, too.
The seller must sign the formal documentation, and the process will be complete once the title registration is arranged with the Land Register of Scotland.
A Few Things Buyers Should Keep In Mind Before Settlement
Once missives are concluded, buyers can’t pick up their keys until the Date of Entry, which is the day they agreed to pay the purchase price and have the seller hand over ownership. There are some things buyers can do to make sure this happens as it should.
- Ensure you can transfer the funds for the sale to your solicitor’s account before the Date of Entry. If there’s money tied up in the bank account that has a notice period of 30 days, you may need to fill out additional paperwork to release those funds in time. The goal is to have your money in your solicitor’s account at least two working days before the settlement itself because your solicitor has to check that money for money laundering purposes. If there’s a gifted deposit the lender has to be informed, too. All of this takes quite a bit of time, so if you can’t get the money to the right place, you may have to wait to get the keys to the property.
- If you are part of a property chain, be sure you settle the sale of your property before you buy the new one. Chains can collapse fairly easily, and the last thing you want is to purchase a new home only to realise that you cannot sell the old one.
- Bank transfers are not immediate. They take some time to show up in your solicitor’s account. What’s more, though, is that there are typically charges for the transfers. A cheque may still be a better method even though it might seem outdated. Even a cheque is not instantaneous, though, as it often takes up to four working days to clear.
- particular banking cut-off times may delay actions until the next working day. That, too, could have an impact on your settlement date as a whole.
- If you intend to port your mortgage, you need to have that conversation with your solicitor. They will have to check on the details before the Date of Entry to ensure everything works as it should.
- Your mortgage payment might be due close to the Date of Entry. If that’s the case, allow it to be taken, as it will be refunded. If it isn’t due until later, you should cancel your direct debit so it doesn’t go through when it shouldn’t.
Does Gazumping Happen In Scotland?
Unfortunately, gazumping happens in Scotland just as it does in the UK. If you’re unfamiliar with the term, the idea is that the seller has accepted the purchase offer from the buyer, but then they accept a different offer from another buyer, maybe one who has offered them more money. It’s not illegal, but it’s not ideal either.
The process is far less common in Scotland because offers to purchase properties are submitted formally in writing from solicitor to solicitor. Before missives being concluded, there’s nothing to prevent gazumping, but the fact that the solicitors are involved in the process so early helps to avoid the problem. More than that, though, estate agents in Scotland are guided by fairly strict regulations to help protect buyers. If a seller does accept a new offer, they have to find another solicitor entirely, as the previous solicitor must withdraw. Some solicitors will even refuse a client who chose to gazump, which creates some problematic delays.
Choosing The Right Solicitor Is Key
Now that you know a bit more about the role missives play in Scottish property transactions, you’ve probably realised that choosing the right solicitor is an important part of the process. How do you find the right person to help?
Start by looking for someone with the right expertise and experience. When choosing a solicitor, it is vital to consider their expertise and experience in property law. Look for professionals who specialise in residential conveyancing or property transactions specifically, as they will possess the necessary knowledge to handle your case adeptly. Seek solicitors with a proven track record, ideally with positive testimonials or recommendations.
Consider someone fairly local, too. Scotland’s property laws and regulations can vary significantly from other regions. Therefore, selecting a solicitor with a deep understanding of local legislation is crucial. A solicitor well-versed in Scottish property law is more likely to be able to handle the unique difficulties or nuances that may arise throughout the process.
Be sure to factor in your ability to communicate with each candidate on your list as well. Open and regular communication is essential for a smooth property purchase. Consider solicitors who keep you informed, promptly respond to queries, and are easily accessible. A solicitor who prioritises effective communication will ensure that you are involved and well-informed at every step, alleviating any concerns or doubts that may arise.
You’ll also want to think about your budget for a solicitor. Discussing fees upfront is vital to avoid unexpected financial surprises. Seek solicitors who are transparent about their fees and provide a breakdown of the costs involved. Understanding their pricing structure can help you compare quotes and choose a solicitor that aligns with your budget.
Finally, make sure you feel comfortable with the solicitor you’re considering. Purchasing a property can take quite some time, and having a solicitor with whom you have good rapport is advantageous. Remember, this person will be representing your interests, so it is important to feel comfortable working together. Consultations or initial meetings can help you gauge their approach, communication style, and whether you feel confident entrusting them with your property purchase. Choosing the right solicitor is instrumental in ensuring a smooth and successful property purchase in Scotland. By considering factors such as expertise, local knowledge, communication skills, transparent fees, and personal compatibility, you can make an informed decision. Investing time in selecting a trustworthy and experienced solicitor will not only provide peace of mind but also streamline the property buying process. So you’ll want to take the necessary steps to find your perfect solicitor and embark on your property ownership journey with confidence.
Missives Can Be Complex!
Navigating the world of missives in Scottish real estate can initially seem complex and overwhelming. However, armed with a thorough understanding of these vital legal documents, buyers and sellers can approach property transactions with confidence and clarity.
Throughout this blog, we have explored the purpose and significance of missives in Scottish real estate. We’ve uncovered their role in outlining the terms and conditions of a property sale and discussed how they differ from contracts in other parts of the world. By shedding light on the intricacies of missives, we aimed to demystify this crucial aspect of Scottish property transactions.
Whether you’re a first-time buyer or a seasoned seller, having a firm grasp on missives is essential for a successful real estate transaction. From understanding the components of a missive to recognising the importance of diligent negotiation, we’ve provided valuable insights to help you navigate this process with ease.
Remember, seeking the advice and expertise of a qualified solicitor is crucial in ensuring the accuracy and legality of the missives involved in your property sale or purchase. They can guide you through the process, address any concerns, and protect your interests every step of the way.