How Do Closing Dates Work in Scotland

Key points

• A closing date is a deadline by which all offers for a property should be submitted
• Closing dates in Scotland function as a blind auction. Buyers are not told the details of any other offers.
• A closing date is normally only set once a property has received two or more notes of interest.
• As a buyer, you don’t need to submit an offer at a closing date just because you have noted interest
• At a closing date, buyers are motivated to submit their best and final offer.
• Your solicitor will be able to assist you in deciding how much to offer at a closing date.

How do Closing Dates Work in Scotland?

Whether you are looking to buy or sell a property in Scotland, it’s important to understand how closing dates work. Warners’ handy guide breaks down everything that you will need to know to successfully navigate a closing date.

What is a closing date?
In simple terms, a closing date is a deadline set by the seller’s agent by which offers must be received from any parties interested in purchasing the property. Once the deadline is passed, the seller’s solicitor estate agent will go through all of the offers that have been received with the seller and they will decide which offer they wish to accept.

A closing date functions as a ‘blind auction’, meaning that the parties submitting an offer will not know details of any other offers that have been received. Because of this, interested parties will be motivated to put forward their best and final offer to give them a chance of securing the property.

When is a Closing Date Normally Set for a Property?
In most cases, a closing date gives a seller the best chance to achieve the highest price for their property, but in order to set a closing date there needs to be sufficient competition amongst potential buyers. Once a seller has two or more notes of interest, their solicitor estate agent will normally speak to them about setting a closing date.

The seller is never under any obligation to do so and it can make sense to postpone setting a closing date a little if there are a lot of upcoming viewings scheduled for the property, but as a seller you won’t want to delay things too long. Properties typically achieve the highest level of interest during their first week or two on the market and the longer you leave it, the more you run the risk of a potential buyer having their head turned by other properties coming onto the market.

Are you obligated to submit an offer at a closing date if you have noted interest?
No, you are under no obligation to do anything just because you have noted interest in a property. Equally, you do not need to have noted interest in a property in order to offer at a closing date.

How Much Should You Bid at a Closing Date?
If you are interested in a property where a closing date, you should speak to the solicitor firm that is helping you with your purchase. They will be able to contact the agent marketing the property you are interested to find out how many competing notes of interest there are. Thereafter, they will be able to guide you on how much you should be looking to offer based on the level of competition, local market conditions, recent comparable sales, and your own circumstances.

Does the Seller Need to Accept the Highest Offer at a Closing Date?
No, a seller is not obligated to accept any offer at a closing date. A seller may choose to accept a lower offer if the buyer is in a more proceedable position such as, for example, the buyer’s offer not being conditional upon the sale of their own property. In some cases a seller may choose to reject all offers received at a closing date, although such instances are very rare.

What Happens After an Offer Has Been Accepted?
Once an offer has been accepted the seller’s solicitor will let the successful bidder know and advise any other parties who offered that they have been unsuccessful. The seller’s solicitor is not permitted by Law Society Guidelines to play offers off against one another meaning that, for example, they are not allowed to go back to other parties advising them of what the highest offer is, and inviting them to increase their offer.

Once everyone has been advised of the outcome of the closing date, the solicitors acting for the buyer and seller will work to complete the legal work on the sale, aiming to get missives concluded as quickly as possible for their respective clients.

If you are interested in selling or buying a property, contact us today on 0131 662 4747, or by email at property@warnersllp.com. Alternatively, if you can arrange a free, no obligation property valuation online, or request a quote for buying or selling today.