What can be more frustrating than seeing an ideal new home slipping through your fingers because your old home has not yet been sold? If you have found the perfect house, but are not in a position to finalize the deal because you are still awaiting a lucrative offer for your existing home, part exchanging could be the way forward for you.
Part exchange deals are more common in car dealerships, where the buyers trade in their old car for a new one, and are less common in other business sectors. The same principle is applicable to the real estate sector as well, where old houses are exchanged for new ones. Almost all home-builders offer part exchange schemes for those who are attempting to move up the ladder and are looking to move into a new build home. However, it is important to understand how part exchange works, to make sure you receive the best possible deal. A part exchange contract usually consists of three parts; finding a buyer, valuation and reservation.
Start by finding a buyer for the part exchange deal. There are number of development companies offering part exchange schemes online. It is recommended that you always sign such a contract with a development company, since it is quicker and more convenient to sell your house to a home builder. The dealer will ask for a few details about your existing home, such as its location and existing market value.
Once you have found a potential home builder for a part exchange deal, they will send at least two independent selling agents on their behalf, to carry out valuations on your existing home. The agents will proceed to estimate the selling price of your home (not the asking price). A company representative may also visit you, to get a better idea about your existing home.
After the selling agents have estimated the selling price of your home, the company will make you a verbal offer for you existing home, before confirming it in writing. If you accept the offer, the company will instruct its solicitors to proceed with the sale. You will also be required to ask your legal advisor to take the necessary measures. Initially, when you start the part exchange deal, your reservation for the new home is provisional, and it continues to remain provisional until the sale process begins. However, once you enter into a sale contract with the development company, the provisional reservation becomes a full reservation.