What does 'Sold Subject to Contract' mean when buying a property?
Find out what Sold Subject to Contract means when you are buying a property. 'What does Sold Subject to Contract mean?' plus over 150 other property related terms and jargon in plain English
Sold Subject to Contract
Once an offer is agreed on a property it is referred to as "sold subject to a contract" or "Sold STC" until legal ownership is fully transferred.
The "contract" is a document which contains:
- Who the vendor is
- Who the buyer is
- What the property is
- The date on which ownership will be transferred
- The price the buyer will pay the vendor
The sale only becomes legally binding on both buyer and seller when they have both signed the contract and both have given each other a copy - known as "Exchanging Contracts".
Exchange of contracts can only happen when a number of checks have been carried out - everything from checking if the seller has the right to sell the property to any requirements your mortgage lender may have such as a valuation survey.
As such even after you have had your offer accepted the property is only ever sold "subject to the contract being signed" and that may take several weeks to organize.
However, and slightly confusing, even after both the vendor and you have signed your contracts and exchanged them the property is still referred to as "Sold Subject to Contract".
This is because exchange is not usually the moment that the property ownership changes. It is just the time you agree, and it becomes legally binding, when the property ownership will change.
At exchange you will also normally pay a deposit (5 or 10% of the property price) which means you still have the balance to pay. This is also written into the contract.
So after exchange you have moved from "subject to the contract being signed" to "subject to the contract being carried out" but both are simply referred to as "Subject to Contract" or STC.
To learn all the lingo involved when purchasing a property pick up a copy of my ebook How to Really Buy a Property.
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- Agreement in Principle
- Bewitching Hour
- Chain Free Buyer
- Chain Free Property
- Contract Race
- Completion
- Exchange of Contracts
- Further Enquiries
- Repossession
- Sold Subject to Contract
- Sold Subject to Survey
- Subject to Contract
- Tenanted Property
- Asking Price
- Contract
- Managing Agent Enquiries
- Power of Attorney
- Off Plan
- Retention
- Negotiator
- Property Chain
- Credit History
- Joint Sole Agency
- Attended Exchange
- Conditional Exchange
- Under Offer
- Gazump
- Fall Through
- Pre Arranged Mortgage
- Draft Contract
- Freeholder
- Drainage Survey
- Ghost Gazumping
- Sale Agreed
- Upward Chain
- Cash Buyer Only
- Bridging Loan
- Deal Chasing
- Time Costs Deals
- Managing Agents
- Pulling Out
- Gazumping Insurance