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The Importance of a Properly Drafted Key Undertaking

The Daily Mail have recently published a story entitled “The Housebuyer from Hell”.  The article in brief relates to a long running Court battle against a homebuyer who ripped out parts of the Sellers £800,000 house before the sale completed. 

In short, the Sellers had given the Buyer permission to carry out some minor works to the garden in between exchange of contracts and completion.  These “minor works” were in fact the removal of the kitchen, the demolition of a fireplace and the erection of an extension and removal of protected trees.  The sale eventually fell through and the Sellers were obviously left with a property which had decreased in value due to these prohibited and unauthorised works. 

This article highlights the importance of having a properly drafted key undertaking in place should you be agreeable to your Buyer entering your property ahead of completion.  It is becoming more and more common place nowadays for Buyers to request access to a property between exchange of contracts and completion to carry out works.  In some cases, the Buyers mortgage lender will insist on works being carried out to the property before they will release the full mortgage value. 

Legally, there is no reason why you should not allow your Buyer access to the property to carry out agreed works provided a tightly drafted key undertaking is in place.  A key undertaking sets out the basis on which the Buyer is entitled to access to the property and sets out exactly what can be and must not be done.  If the Buyer was to breach the terms of the key understanding they would be in breach of a legally binding contract and it would be possible to pursue a claim against them in the Court.