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How To Put An Offer On A House That Is SSTC?

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Every time you see a “Sold” sign in the UK, you will likely spot the acronym SSTC. This stands for “Sold Subject to Contract” and can be confusing for both buyers and sellers.

It is estimated that two out of every three properties remain in the SSTC stage for a longer period than you may expect. That is why it is important to understand the meaning of sold subject to contract and the process that follows.

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What Does Sold Subject to Contract Mean?

Agreeing to sell your home is not legally binding until contracts are exchanged, which happens at a later stage in the home sales process. Therefore, when a buyer makes an offer which is accepted by the seller, this is known as ‘Sold Subject to Contract’ (SSTC).

For the buyer, this means it is time to finalise the mortgage process if they have not already done so and to arrange searches and a survey to ensure the property is in good condition. If any problems are found, they have the option to back out or renegotiate the terms of the agreement.

For the seller, being in SSTC means that the home’s listing is usually removed from most websites, although in some cases it may remain with the SSTC acronym added.

The seller should also ask for proof of funds from the buyer and begin working with a conveyancing solicitor to transfer ownership of the property.

Do SSTC Properties Always Sell?

When you reach the point of SSTC, you may feel relieved, but there’s still a chance the sale won’t go through. This can happen for a variety of reasons.

One of the most common is that the buyer’s financing falls through. If they weren’t pre-approved for a mortgage or their mortgage has expired, the lender won’t provide the necessary funding, meaning the sale won’t happen.

Additionally, if the home appraisal isn’t accurate, the bank could choose not to approve the loan, which could also lead to the deal falling through.

Survey issues are also a cause of potential failure. A survey of the home can reveal any number of problems, from outdated plumbing and electrical systems to major foundation issues.

While it’s designed to help buyers understand what they’re getting, if the survey uncovers issues, they may choose to back out of the sale.

Even if they don’t, they may ask for a much lower price, which the seller may not be able to accept, thus causing the deal to fail.

Another reason the sale could fail at this stage is due to housing chain complications. A chain is created when the seller buys a new property before the current one is sold. The same could be true of the buyer.

If any part of the chain collapses or the paperwork takes too long, the SSTC deal may not go through. According to Which? one in five property deals fail to reach completion due to chain issues, so it’s important to be aware of this.

How To Put An Offer On A House That Is SSTC
For the seller, being in SSTC means that the home's listing is usually removed from most websites, although in some cases it may remain with the SSTC acronym added.

Exchanging Contracts

Once the buyer and seller exchange contracts, the home is officially off the market. The sale is complete and all the details are legally binding. The solicitors handle the specifics of the sale and everyone is aware of the date of completion.

Usually the buyer will put down a payment of up to 10% of the property’s value. If either party decides to back out, they will be in violation of the contract and the seller can keep the deposit.

Why Understanding SSTC Matters?

Buying or selling a home in SSTC (Sale Subject to Contract) can be incredibly frustrating. You’re both at a point where you feel like the deal should be done, but legally nothing has been finalized.

If you’re facing this situation, it’s a good idea to get in touch with your estate agent or conveyancing solicitor to understand the timeline of the process. This will help you gain a better understanding of what is going on.

Any thoughts about selling your home?

Are you looking to sell your house? We buy houses in any condition. Get in touch if you are thinking of selling.

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