Everything You Need To Know:

What Is a Memorandum of Sale? (2023)

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You’re planning to buy or sell a home?

Well, you’ll come across dozens of official-looking terms that you may not have heard before. 

One of these many terms is the Memorandum of Sale.

In simple terms, a Memorandum of Sale is a mandatory legal document required to finalise a sale.

Continue reading so you understand whether a Memorandum of Sale is legally binding.

And what does legally binding exactly mean?

This article will answer all of your questions.

And you’ll be able to make an intelligent decision based on the in-depth information provided here. 

Let’s dive in!

Table of Contents

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1. What Is a Memorandum of Sale?

In a nutshell, a Memorandum of Sale, also known as MOS, is a legal document that records information relating to the sale of the property.

It acts as a reference document for solicitors and mortgage advisors for future legal processes and issues associated with a sale.

Although not legally binding, a Memorandum of Sale is required to finalise a sale. 

But why precisely is a Memorandum of Sale so important and where do you get one?

Read below to find out.

2. What Information Does a Memorandum of Sale Have?

Since it’s often used for legal purposes, a Memorandum of Sale contains the following important information:

● Final agreed cost of the property

● Full address of the property in question

● Buyer and seller’s contact information (name, address, contact number, and email)

● Solicitors’ contact information, for both buyer and seller (name, address, contact number, and email)

● Type of property, i.e., leasehold or freehold

● Deposit amount or any relevant fees

● Mortgage lender that finances the purchase, if applicable

● Details for the mortgage company, if buying with a mortgage

● Property’s land registration number as given by the HM Land Registry

● Confirmation of ownership via HM Land Registry

● Any property chain information the buyer and seller might be involved in after the purchase was complete

● Expected timescale for contract exchange and completion

● Energy Performance Certificate (EPC), which details the property’s energy use and typical energy costs

● Special conditions of sale, if any; e.g., fixtures, fittings, or furniture that are included (or excluded) in the sale

● Any other relevant or useful information pertaining to the sale.

It’s important to note that a Memorandum of Sale doesn’t have a special or legal format to abide by. 

Some memorandums provide all the information above plus more, while others list merely a fraction than what’s stated.

That said, always heed the advice of a solicitor when issuing a Memorandum of Sale, regardless of the format you’re following.

Here’s a template example of a Memorandum of Sale: 

Memorandum of Sale

123, Example Street, Town/City, County, Postcode 

Purchase Price = £XXX,XXX 

Deposit Price = £XX,XXX

HM Land Registry No.: HLR 123456

Buyer Information 

Full Name: John Smith 

Address: 123 Example Street, London Postcode: SE15 3YN 

Phone Number(s): 07000000000 

Email: johnsmith@email.com

Seller Information

Full Name: Chris Williams 

Address: 123 Example Street, London 

Postcode: SE15 3YN

Phone Number(s): 07000000000 

Email: chriswilliams@email.com

Buyer Legal Conveyancer 

Full Name: Julia Jones

Company: 123 Solicitor’s Firm 

Address: 123 Example Street, London

Postcode: SE12 5YN

Contact Phone: 08000000000

Email: juliajones@email.com

Seller Legal Conveyancer

Full Name: Taylor Evans

Company: 123 Solicitor’s Firm

Address: 123 Example Street, London

Postcode: SE90 6YN

Contact Phone: 08000000000

Email: taylorevans@email.com

Mortgage Sale Information, If Relevant

Name of Mortgage Lender: Mortgage Co.

Amount of Mortgage Being Granted: £XXX,XXX

Name of Mortgage Broker / Advisor: Keith Johnson

Contact Information: 08000000000 

Email: mortgage.co.johnson@email.com

Property Information

Is This an Auction Sale? (Yes/No)

Is This a Quick Cash Property Sale? (Yes/No)

Is This a Freehold Property? (Yes/No)

Is This a Leasehold Property? If So, State the Remaining Years on the Lease: 

Has Ownership Been Checked? (Yes/No)

Is the Energy Performance Certificate Included? (Yes/No)

Fixture and Fittings Included In the Sale: 

Fixture and Fittings NOT Included In the Sale:

Exchange/Completion Dates

Expected Exchange Date: 25 November 20XX

Expected Completion Date: 25 December 20XX

Additional Notes

Special Conditions of Sale:

Legal Issues of Sale: 

Extra Notes:

3. When Should a Memorandum of Sale Be Issued?

A Memorandum of Sale should only be issued after an offer has been made and accepted. 

Do note that a Memorandum of Sale differs from a Contract of Sale. 

Even when it’s issued and given to the buyer, it doesn’t mean the property officially belongs to them.

Instead, it acts as a written confirmation that the buyer and seller have mutually agreed to a sale price.

How Long Does Issuing A Memorandum Of Sale Take?

Once an offer has been accepted, there’s no particular timescale for a Memorandum of Sale to be issued. 

It can take anywhere between 24 hours to 12 weeks, depending on how quickly the seller obtains the information required.

In most cases, any delay is caused by the additional documentation required to finalize the sale, such as the certificate of Energy Performance, land registration number, confirmation of ownership, etc.

Delay can likewise be caused when acquiring details from the buyer, such as the document requiring details of funds, the solicitor’s contact information, and the final agreed cost of the property.

With that said, estate agents typically issue the Memorandum of Sale as soon as possible to quicken the sales process between the buyer and seller. After all, the faster the sale, the quicker the commission.

If the Memorandum of Sale takes longer than a few short weeks to materialise, there might be an issue with the property documents. 

It’s also possible that the seller is waiting on more viewings before accepting your offer.

Make Changes to the Memorandum of Sale After It's Been Issued?

As mentioned earlier, a Memorandum of Sale isn’t legally binding. In fact, signatures aren’t even required to complete a Memorandum of Sale. 

Unlike property transfer documents, changes can still be made in a Memorandum of Sale upon the insistence of the buyer or seller. 

The buyer or seller can also pull out after the Memorandum of Sale has been produced if either party has changed their mind.

6. Who Issues a Memorandum of Sale?

A Memorandum of Sale is issued by either the estate company or the estate agent once the buyer has accepted the offer by the seller.

The seller will provide the estate agent or the estate company with the necessary details, including the buyer’s contact information, the solicitor they’ve chosen for their conveyancing, and other information such as EPC, land registration number, and confirmation of ownership.

Once the documents are ready, the estate company or agent will issue the Memorandum and proceed with the final aspects of the sale.

7. Is a Memorandum of Sale Really Necessary? If So, Why?

If you want a sale to go through quickly and efficiently, issuing a Memorandum of Sale is crucial.

As mentioned above, a Memorandum of Sale lists all the important information related to the sale of the property, including the cost of the property, buyer and seller contact information, land registration number, and any other relevant or useful information pertaining to the sale.

It’s basically a one-stop guide to everything property related. It saves a significant amount of time when selling the house, and acts as a precursor to the final contract.

Furthermore, a Memorandum of Sale gives solicitors, mortgage lenders, and other third parties a consolidated source of information, which can aid in legal proceedings, applications, and so on.

8. Can a Property Be Sold Without a Memorandum of Sale?

A property sale can’t proceed without a Memorandum of Sale.

If a Memorandum of Sale is delayed, so will the purchase of a property. It’s a mandatory document; without it, the sale won’t legally go through. 

With the right agent, a Memorandum of Sale shouldn’t take longer than a week or two to be submitted.

9. Memorandum of Sale vs. Notification of Sale

A Notification of Sale is another term for a Memorandum of Sale. 

Both contain the exact same information and the exact same function.

A Notification of Sale shouldn’t be confused with a Notice of Sale, which is a legal document a mortgage lender sends to a borrower as part of their mortgage agreement.

10. What Happens After a Memorandum of Sale Has Been Issued?

Once the Memorandum of Sale has been produced and exchanged, the legal sales process begins.

Step 1: Document Confirmation

First, the property will be removed from the open market and marked as SSTC, or Sold Subject to Contract.

Buyer eligibility checks will then be conducted to make sure the buyer is in a financially viable state to proceed and complete the purchase.

The solicitor may ask the buyer for Proof of Deposit or evidence of a mortgage proposal, which includes the buyer’s last three months’ payslips, as well as proof of identity which comes in the form of a passport or driving license. 

Additionally, the solicitor will require several documents from the property owner, including an updated Property Information Form (TA6), Fittings and Fixtures Form (TA10), and, if relevant, a Leasehold Information Form (TA7).

Step 2: Mandatory Searches

After the required forms have been submitted, a number of mandatory searches will be conducted in and out of the property.

The search reviews the local area’s upcoming construction plans that may impact the property, regardless of how small. It also inspects environmental factors that the buyer might need to consider before purchasing the property.

Surveys will also be conducted by the Royal Institute of Chartered Surveyors (RICS), which covers three main surveys: General Condition Report, Homebuyers Survey, and Structural Survey.

The RICS General Condition Report covers the following points:

  • General condition of the property on the day it was inspected
  • Obvious defects that need immediate care
  • Issues that might be hazardous to the safety of individuals living on the property
  • Anything else that needs further investigation to prevent future accidents or serious damage to the property
The RICS Homebuyers Survey is much more detailed than the RICS General Condition Report. An RICS will take his or her time in inspecting the ins and outs of the property, and will provide a report based on the inspection. The report details the following information:
  • Recommended repairs or replacements the property needs
  • Advice the buyer should take before purchasing the property

The RICS Structural Survey helps the buyer make a reasoned and informed decision when purchasing the property. It reports the following:

  • Defects that need repairing, replacing, or investigating
  • Identifiable risk of potential or hidden defects
  • The overall structural condition of the property
  • Estimated costs for repairs

Step 3: Mandatory Searches​

Upon completing all the required RICS inspections, the finalisation of sale will commence.

The solicitor will issue an official Transfer of Ownership form (TR1) that both the seller and buyer must sign. Once signed by both parties, the sale is legally binding.

The finalisation of a TR1 takes anywhere between several weeks to several months. Usually, though, it takes no more than four to six weeks to complete a transfer of title.

11. Reasons a Memorandum of Sale Doesn’t Go Through

There are several reasons that cause a Memorandum of Sale to fall through, including:

  • Delays in the completion of the document
  • Property defects as reported by the RICS
  • Lack of funds after the agreed amount has been submitted
  • Slow, confusing, or disorganised instruction of the involved estate agent or solicitor
  • Falling out between buyer and seller
  • Seller found a better prospect than the current buyer
  • Expiration of mortgage offers
  • Issues related to property chain
  • Change of mind by either party

Most of the mentioned problems occur due to issues within the property chain.

For reference, a property chain refers to a group of properties where the finalisation of a sale is dependent on the sale of a connected property.

This means that if a buyer wants to purchase a house, he or she must first wait until the seller buys their next home to finalise the transfer of ownership.

The more people in the chain, the more complicated and lengthy the process. If you want a quick and issue-free purchase, make sure the property you’re buying is chain-free.

A Memorandum of Sale can also fall through if the document takes longer than necessary to issue. The longer it takes to issue, the longer it takes to complete the sale and the higher the risk that the buyer or seller may renegotiate on the price. It also increases the risk of the buyer backing out of the sale entirely.

12. How to Prevent a Memorandum of Sale From Falling Through?

Selling property is a timely process. Between advertising and searching for potential prospects, it can take months and sometimes even years to finalise a sale. It’s especially frustrating for a sale to fall through while issuing a Memorandum of Sale.

Here’s how to prevent the sale from falling through just as you’re issuing a Memorandum of Sale.

Prepare the Necessary Documents

To maximise the chance of a successful property sale, have all the important documentation at an arm’s reach. Collect all relevant paperwork that might be required for the sale.

Here are some of the important documents required to complete a sale:

Gather the above-mentioned documents even before you find a buyer, as it might take weeks to finalise a single document. If you’re not quite sure where to start, ask for the guidance of a solicitor of a legal representative. 

Choose the Right Agents

In most cases, the sale of your property depends on the expertise of the estate agent.
As such, when choosing an agent, make sure he or she has a ton of experience. 

If possible, find an agent that has successfully sold a property in the same area as your property. 

Also, make sure they’re proactive in gathering feedback from prospective buyers to make the sale process smoother and more efficient. 

An experienced agent will also make sure that the Memorandum of Sale is issued in a timely manner. 

As mentioned above, one of the biggest reasons a property sale falls through is due to the delay in issuing the Memorandum of Sale.

What is Memorandum of Sale UK

Set an Appropriate Price

Whilst it’s tempting to set the highest price possible for your property, it may save you a lot of time (and heartache) by going for a slightly lower offer to find a more solid buyer. If your property price is set too high, not a lot of people will be interested.

Price your property competitively—but not too competitively. You certainly don’t want to sell your property below the market value.

Setting an appropriate price for your property reduces the chances of your buyer pulling out because they found a “better” or cheaper option. Ideally, your property price should be within 10% to 15% of the average sold price in your neighbourhood within the last six or so months.

If you can’t quite decide how much you want your property to cost, let a real estate agent do it for you. Experienced agents can set a price on a home the minute they step into the property. 

They know how valuable your property is and how much it usually sells in the neighbourhood.

Avoid the Property Chain

While it’s tempting to include your property in a property chain, it might prevent you from selling your property in a timely manner. Avoid this risk by making yourself chain-free.

If the property you’re selling is where you currently reside, it’s often wise to proceed with the sale and move into a rental property while searching for your next home. 

This way, the buyer won’t have to wait until you purchase a new property and drop the sale if it takes too long.

Build a Relationship With All the Parties Involved

Communication and trust are two of the most important aspects of selling property. 

It not only keeps all parties connected, but it also ensures transparency from the Memorandum of Sale to the property transfer. 

It likewise reduces the likelihood of the buyer pulling out before the exchange, as you’ve already built a personal connection with them. 

With that said, keep the relationship between you and the buyer professional. 

If the buyer feels too comfortable with you, they might lower their offer at the very last minute, despite having already agreed to a higher price. This is called “gazundering.”

Unfortunately, gazundering is an extremely common tactic among homebuyers. It often backs sellers into a corner, forcing them to sell at a lower price to “get things over with.”

If such a scenario happens, it’s best to step away from the transaction and search for another buyer.

Get a Home Buyer’s Protection Insurance

According to the HOA (Home Owners Alliance), one in three property purchases fall through. To avoid financial fees associated with being gazumped or the seller changing his or her mind, it’s worth getting a Home Buyer’s Protection Insurance.

This insurance allows you to claim back some of the valuation fees, mortgage/lender fees, conveyancing fees, and survey fees you’ve spent should your purchase fall through.

The cover returns the following amount:

  • Conveyancing fees: up to £750
  • Survey and mortgage valuation fees: up to £500
  • Mortgage arrangement and lenders fees: up to £250
  • Gazumping protection

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With our partners you can achieve a very fast sale or a slower one if you’re not pressed on time.

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It all depends on your circumstances and preference.

Final Thoughts

A Memorandum of Sale is a mandatory legal document that records the details of a property sale. 

It documents all the relevant information agreed between buyer and seller, including the property cost, deposit fees, seller and buyer contact information, and more.

A Memorandum of Sale isn’t to be confused with a Contract of Sale, as the former isn’t legally binding while the latter is. 

Instead, it’s a formal document that shows that the buyer intends to complete the transaction as stated in the document.

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