When searching for a conveyancer to deal with the sale or purchase of your home, you may come across some offering ‘no sale, no fee’ deals. Is this the best option for you? We look at the advantages and disadvantages of no sale, no fee conveyancers to help you decide.
What does no sale no fee really mean?
In no sale no fee conveyancing, you are only charged for a solicitor’s services once the transaction is complete. Usually, you will pay an initial deposit to secure the no sale no fee deal but will then not pay any more to your solicitor until the sale is completed. This can be particularly beneficial in cases where a house sale falls through, whether this is through gazumping, gazundering, a break in the chain, poor surveys or because someone simply changes their mind. However, you may still have to pay for searches carried out by third parties such as Land Registry.
What are the advantages of no sale no fee deals?
The main benefit is that you only pay for the solicitor’s services when the sale is successfully completed. This can be particularly beneficial if your sale has fallen through because of gazumping or some other factor beyond your own control. Many may find it an attractive option in times when the housing market is slow or if they are selling the property themselves.
Instructing a conveyancer in a no sale no fee deal will usually mean paying a deposit. According to the HomeOwners Alliance failed attempts to buy and sell property sees more than £500 million a year go to waste. A small fee upfront could save you as much as £1,500 further down the line.
In some cases, some conveyancing firms, such as Sam Conveyancing, will move your deposit to another property transaction if the first falls through. However, it is important to check if this is an option with your conveyancer first. Some may let you carry out searches on a different property for free, but this is a goodwill gesture for staying with them and is by no means offered by all no sale no fee conveyancers. You must check the fine print first to see whether this is included and whether new property purchases must be within a certain time frame.
No win no fee conveyancers may also be an attractive option for those who are undecided on whether they want to progress with a purchase but need to show they have appointed a conveyancer.
What are the disadvantages of no sale no fee deals?
While the conveyancer is not paid in full until the transaction is complete, you still have to pay for searches and other disbursements. They are usually non-refundable, and so you will be out of pocket on these if the sale does fall through. In most cases, you have to pay an initial deposit which is also non-refundable.
No sale no fee offers are not universally available. They cannot be used in certain transactions such as a property being sold at auction or subject to a chain.
Another downfall of a no sale no fee deal is that you may end up paying more overall. Some firms may charge a success fee in addition to their standard fees, while some may require a monthly retainer whether or not the sale progresses. You may also incur some hidden costs, such as administration fees. Always be sure to check out the fine print and be fully aware of all implications before signing up to a no sale no fee offer.