Chain Free

Part-Exchange Guide

If you wish to buy a new-build property and have a home to sell, part-exchange could provide the ideal solution.

Part-Exchange Guide

1. Introduction to part-exchange

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Geared towards the purchase of new homes part exchange enables home buyers to trade in their existing home as part payment towards a brand new one.

The part-exchange process removes any form of property chain and speeds up the transaction process.

Part-exchange provides a guaranteed sale, a smooth transaction and avoids the need for estate agency fees. In return, the part exchange homes part exchange homes are normally purchased for around 90-95% of its market value.

2. Benefits of part-exchange

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Although in choosing a part exchange option, you may need to sell your property for 5-10% below market value, there are many benefits that over-ride this minimal loss:

  • No estate agency fees (usually 2% of the sale price).
  • No long chains.
  • Quick and simple transaction.
  • Ability to purchase a brand new property, with all the associated benefits.
  • Guaranteed sale.

3. Who is eligible?

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In the majority of cases the following requirements will need to be met for a property to be considered for part-exchange:

  • The property must be in a good state of repair with no structural problems.
  • The property may be required to have a fixed term remaining on the lease (if leasehold).
  • The value of the exchanged property is often required to be no more than 70% of the value of the new-build property.
  • Some property types such as mobile homes and properties with flat roofs may be excluded from some part-exchange schemes.

4. The part-exchange process

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The following steps outline the process you will need to follow before the part-exchange transaction can be progressed.

  • Firstly contact your local Estate Agents to find out which new property developments in your location offer part-exchange options.
  • After choosing your desired property, the developer will arrange for your existing home to be valued.
  • You will then be made an offer (subject to survey) based on the average price of the valuations. This is usually 90-95% of the market value of your property.
  • Next you will need to appoint a property solicitor and apply for a mortgage, our Guide to Buying provides more information on this.
  • On accepting the offer you will need to pay a reservation fee and complete the developer's plot reservation documentation.
  • A survey will then be carried out on your current home to check it has no serious faults.
  • Providing the survey doesn't uncover any problems, contracts will usually be exchanged within a four week period.
  • On exchange of contracts you will usually be required to pay a 10% deposit. A predetermined proportion of this deposit will be retained by the solicitor to cover the part-exchange property.
  • As and when the developer is satisfied that the property has been left in good repair, the monies will be released by the solicitor.
  • Congratulations! You can now plan your move. For useful hints and tips when moving, read our Guide to Moving.

Countrywide's nationwide network of Estate Agents has new development listings across the UK, many of which participate in part-exchange schemes.

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