How Covid-19 May Affect Your House Move

We invited Lauren Fitzgerald, property expert at Healys Solicitors, to write a guest blog and share her thoughts on how the current COVID-19 pandemic may impact couples who are selling a property as a result of a separation or divorce.

Separating from your partner or getting a divorce is a difficult process. However, the current situation and the uncertainties that come with it have made this process even more complex. You may be facing financial pressures such as redundancies or reduced incomes, but there is still a lot of support available to you. Many legal professionals are working remotely to continue to support their clients and contacts during this difficult time.

In order to financially support a separation and divide equity between two parties, you may be considering selling your family home, which is most often a family’s most valuable asset. It is therefore important to consider from a financial perspective what to do with it. If you are unable to sell your property at the moment due to the current social distancing restrictions imposed by the Government, then options such as a Transfer of Equity and remortgage if one party is able to take on the mortgage payments or continuing to own the property jointly subject to a Declaration of Trust governing the terms of ownership and occupation may be more suitable to your situation.

Some firm guidance has been provided by the Government in respect of moving house during this time and a brief explanation is set out below:

• If you have already exchanged contracts and your new property is vacant, then you may be able to proceed with the move provided the current social distancing restrictions are strictly complied with.
• If you have already exchanged contracts but your new property is not vacant or somebody in the chain is unable to move for any reason, i.e. due to self-isolation or not being able to find a removal company, then you should try and agree a delayed completion date between all parties in the chain. This will mean a variation to the Contract needs to be made and must be agreed by all parties in the chain.
• If you have not yet exchanged contracts, then you should either delay the exchange of contracts until a certain completion date can be agreed or exchange contracts with a delayed completion date, with a clause included in the Contract to complete earlier by mutual agreement between all parties in the chain.

UK Finance has announced a three-month payment holiday for mortgages for those financially affected by Covid-19. You may wish to consider applying for this if you are unable to sell your property or if one party is unable to take on the mortgage payments on their own.

In order to support customers who have already exchanged contracts for house purchases and set completion dates, lenders will enable these customers to extend their mortgage offer for up to three months. If you have already exchanged contracts and set a completion date then this will assist you and any other parties in the chain who have a mortgage and will enable a new completion date to be agreed.

The Bank of England Base Rate is the lowest it has been for years, having been slashed from 0.75% to 0.25%, then 0.1% in these past few weeks. With this in mind, now could be the ideal time to fix your mortgage rate although you should bear in mind that some lenders have withdrawn some of their products for the time being and are not carrying out any physical valuations of properties. This will impact on any parties in a chain who have not yet received their mortgage offer. You should speak to your mortgage broker about this as soon as possible. Most brokers are now working remotely and are up to date with the current guidance from lenders so will be able to guide you through this process.

Whether you are buying or selling your property, remortgaging to another lender or carrying out a Transfer of Equity, you will need to appoint a conveyancer to act for you.

Lauren Fitzgerald at Healys LLP (an award winning conveyancing solicitors with a vast amount of experience in all aspects of property law) can be contacted via their website, directly by calling 01273 669115 or by email at [email protected].