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What is No Sale No Fee Conveyancing?

Adele MacGregor

Written by

18th Jan 2021 (Last updated on 30th Sep 2021) 8 minute read

“No Sale No Fee Conveyancing” is a sales agreement from a conveyancer which means if the sale or purchase of the property falls through, you won’t have to pay their legal fees.

Be aware that this does not mean that you will not incur any costs if the sale fails to complete. Any costs from third parties incurred on your behalf, for example for searches and surveys, will need to be paid to your conveyancer regardless of the outcome of the sale.

Compare My Move work with financial and property experts to bring you the most up to date information on what it means to use a no sale no Conveyancer. Below, we explore what No Sale No Fee means for the buyer and seller, the costs involved and the advantages and disadvantages of using this type of conveyancing service.

This article will cover the following:
  1. How Does It Work?
  2. How Much Does It Cost?
  3. Who Offers No Sale No Fee?
  4. Advantages and Disadvantages
  5. Is It Worth It?
  6. What Can Cause a Sale to Fall Through?
  7. Home Buyer Protection
  8. Learn More About Conveyancing

How Does It Work?

Also referred to as “no completion no fee” or “no move no fee conveyancing”, this type of conveyancing service protects the buyer or seller from potential financial loss in the event that the sale falls through. This can give you peace of mind if you have any concerns about financial loss if the sale does not go ahead.

Without a no sale no fee agreement, you will be required to pay the full legal fees for the conveyancing process, even if the transaction fails to complete. For many homebuyers, this can be a large financial loss, leaving you nothing to show for several hundreds of pounds spent on legal fees.

However, it is important to note that “no fee” is not strictly accurate as you will incur some fees if your conveyancer has already made payments to third parties on your behalf. This includes any surveys, searches and fees paid to the Land Registry. It is only the basic fee for the time spent dealing with a case that is included. Be aware that you may also be required to pay a deposit upfront.

To learn more, read What is Conveyancing?

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How Much Does It Cost?

According to our estimates (based on a sample of conveyancing costs across the UK), the average conveyancing fees for buying a house is £1,040. The average cost of conveyancing for selling currently sits at £1,000.

Costs for any type of conveyancing will depend on the cost of the property, the area and the conveyancing firm that you choose to work with. Some solicitors might offer a fixed fee conveyancing service, so it's important to ask this upfront.

In some cases, you may find that the fees for a no sale no fee conveyancing solicitor are higher than “traditional” conveyancing. So that firms can offer this service, fees will be higher across the board so that they can recoup lost earnings from uncompleted sales. This could mean an extra 15% cost to a customer who pays for this service. Some conveyancers may also charge a deposit upfront.

As we have stated above, the “no fee” element of the arrangement only applies to the time spent dealing with your purchase or sale. You will still be required to foot the bill for payments made to third parties for searches and information sourced on your behalf.

Fees for local authority searches, which are organised by your conveyancer, will vary from location to location as the local authority is responsible for setting its own fees. On average these can cost anywhere between £50-£250 and would be charged to you even if the sale of the property collapsed

Who Offers No Sale No Fee?

Although not all conveyancers will offer this service, some well-known firms offer No Sale No Fee Conveyancing. You may also find that an independent or local conveyancer may also be able to offer you this service.

When choosing a conveyancer, it is worth noting that it is at the solicitor’s discretion whether or not they want to take your case on a “No Sale No Fee” basis. As a result of the 1995 Conditional Fee Agreement (CFA), if the solicitor does not wish to take your case (if it is clear there is a high chance of the sale falling through, for example) they can refuse to go ahead with the legal work on your behalf.

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Advantages and Disadvantages

The obvious advantage is that if the sale falls through, you are not at risk of losing hundreds of pounds on legal fees. However, there are many other factors to consider when using this type of conveyancing service.

Below we’ve set out the advantages and disadvantages of using No Sale No Fee when buying or selling a property.

AdvantagesDisadvantages

You are not at risk of losing money if the sale falls through

This type of conveyancing can potentially come with higher fees attached than traditional conveyancing services.

Your chosen conveyancer will have an incentive to keep the sale on track and moving as they will lose their fee if the sale is not completed.

You will need to be aware of upfront deposits, hidden costs and fees that may be added that are not included under the “main” fee. These could be charged regardless of the outcome of the sale.

Some property solicitors may allow you to move the deposit paid on the failed sale to your next transaction.

You will still incur fees for anything the conveyancer has organised on your behalf such as Environmental searches.

Is It Worth It?

Depending on your financial situation and personal circumstances, No Sale No Fee can either be of benefit or can put you at a disadvantage.

If the risk of your property sale falling through is a particular concern and the loss of funds for a full conveyancing service could hit you especially hard, “No Sale, No Fee” might be worth considering.

However, the protection offered by this type of conveyancing against losing money on legal fees should the sale fall through is offset against the higher costs involved. If and when the sale is completed, you could be faced with a higher bill than if you had used a traditional conveyancing service.

Also, remember that in the event the sale falls through, this service does not exempt you from all costs. You will still incur fees for anything the conveyancer has organised on your behalf such as searches.

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What Can Cause a Sale to Fall Through?

In 2019, one in four (24.42%) of house sales in England and Wales fell through before completion according to figures released by Quick Move Now. Below, we review some of the more common reasons why a transaction may fail to complete.

Property Chain Break

A break in the property chain is one of the most common reasons for a sale to fall through. A property chain forms when a line of buyers and sellers are linked together as their property transactions depend on one another. For example, someone buying and selling a house will be waiting for the sale to complete on their house, prior to completion on the house they are looking to buy.

This can lead to a long line of buying and selling and any delays in this chain can impact every other transaction. If a sale falls through, this can also have a domino effect on the buyers and sellers linked with that transaction.

Buyer or Seller Changed Their Mind

Sometimes a buyer will simply change their mind on a property purchase. This can be influenced by financial factors, changes in circumstances or a change of priorities. Sellers may also change their minds about selling their property. This could be because they have decided to remain in their current home, or they may pull out of the sale if the process is moving too slowly.

Problem Identified in a Survey

Buyers may also pull out a property transaction if their homebuyer or building survey reveals a serious concern or potential issue. Issues on the land could include a Japanese knotweed infestation, subsidence or evidence of contaminated land. Within the home itself, anything from structural issues to damp and woodworm could make a buyer change their mind about proceeding with the purchase.

Gazumping

Gazumping occurs when a seller has accepted an offer and later accepts a higher offer from another buyer. This is legal in England and Wales although the law is different in Scotland. Gazumping can happen at any point during the buying process up until the exchange of contracts.

Difficulty Securing a Mortgage

Even if a buyer has a Mortgage in Principle when making an offer on a property, this does not guarantee a mortgage from the lender. If a buyer’s financial circumstances change, they can be refused or have difficulty obtaining a mortgage (for example, if they are on a zero-hour contract). This can delay the sale and even cause it to collapse completely.

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Home Buyer Protection

As an alternative to no sale no fee conveyancing, one option is to take out Home Buyer Protection Insurance. This is an insurance policy designed to cover you if the sale falls through, allowing you to cover some of the costs paid out in the process such as valuation fees, mortgage fees and fees for searches and surveys.

Be aware that a Home Buyer Protection policy must be taken out prior to appointing a conveyancer.

Learn More About Conveyancing

This is part of our conveyancing guide. In our next article, we take a look at what a declaration of trust is. To learn more, read what is a declaration of trust.

Adele MacGregor

Having written for PerformanceIN, WalesOnline, Grazia Magazine and The Olive Press, Adele now writes advice articles for home movers, first-time buyers and house sellers alike.

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