One of the consequences of a buoyant property market is the increased use of sealed bids by sellers. It is an attractive proposition for buyers because it speeds up the purchase process, but it is stressful for all parties.

We have compiled a list of useful points for both sellers and buyers.

For Sellers

1. Instruct specialist solicitors that you intend to embark on this process with. Ensure that they are prepared to act quickly and that they are suitably experienced to deal with sealed bids.
2. Instruct estate agents who are also suitably experienced to deal with the sealed bid process.
3. Consider whether your property is suitable for the process.
4. Consider the guide price carefully, remembering that you really want a bid substantially more that the guide price, but you don’t want to price yourself out of the market.
5. Ensure that your estate agent has explained the process carefully and accurately to the bidders. Good estate agents will have a written comprehensive guide to the sealed bid process, perhaps on their website or included with the written particulars of your property.
6. Arrange with your estate agent to advertise viewing day(s) so your property can be viewed efficiently.
7. Some purchasers may wish to circumvent the sealed bid process by making an early direct bid.
8. Arrange for all the sealed bids to be sent directly to your solicitor and for all the bids to be opened at your solicitor’s office.
9. Remember sealed bids are not binding and that the highest offer may not necessarily be the best bid for you and your situation.
10. Ensure that the sealed bid application form includes: all contact details; précis of the bidder’s position to proceed if their bid is successful; the price which they have offered; solicitor’s details and a financial summary of the bidder’s position, with accompanying documentation.

For Buyers

1. Instruct suitably experienced specialist solicitors who can act quickly and efficiently.
2. Be prepared. Get all your finances in place, e.g. mortgage offer or other funding, and have all confirming documentation.
3. Don’t overbid. Problems can arise if your mortgage company values the property lower than your bid.
4. Find out how many others are also bidding.
5. Include with your bid a covering letter which details:
   1. The amount that you are borrowing (if applicable);
   2. Details of the lender;
   3. Proof of funds (e.g. bank statements);
   4. Proof of deposit (e.g. bank statements);
   5. Your solicitor’s details;
   6. Whether you are in a property chain or not;
   7. An idea of timescale that you and your solicitors envisage to exchange and complete.
6. Rarely, instances of identical bids occur, which can lead to a second round of bidding or an even more stressful situation of either a survey race or a contracts race, either of which could result in additional non-recoverable expenses if you are the loser. Really think carefully before embarking on these types of ‘races’.
7. Don’t forget bids are not binding.

If you are dealing with a sealed bid process, either as a seller or purchaser, contact us to see how our specialist property solicitors can help you. Please fill out our online enquiry form or telephone us on 020 7387 2032.