How to buy and sell a home in Scotland

There are several significant differences in the process between buying a home in England and doing the same in Scotland. But don’t worry - these differences do not make it ‘easier’ or ‘harder’ to buy in one place over another. They are simply a different processes. 

While obtaining a mortgage and buying a property in Scotland is broadly like that in England and Wales, there are a few things to note. 

Mortgage products in Scotland are very similar to those in England.

There are fewer lenders who will lend in Scotland and many of those will also operate restrictions, granting a mortgage only for certain postcode locations. Therefore, you may find that your choice of lender will be more limited, but this shouldn’t be a major problem unless you have very unusual mortgage needs.

Mortgage lenders who will provide mortgages in Scotland (Correct as at 11.10.2023):

• Accord Mortgages
• Aldermore
• Bank of Ireland UK for intermediaries (& Bespoke by Bank of Ireland UK for intermediaries)
• Barclays Mortgage
• Bath Building Society
• Bluestone Mortgages
• Chorley Building Society
• Clydesdale Bank
• Coventry Building Society
• Darlington Building Society
• Digital Mortgages by Atom Bank
• Ecology Building Society
• first direct
• Foundation Home Loans
• Furness Building Society
• Halifax
• Hanley Economic Building Society
• Hodge
• HSBC
• Kensington
• Leeds Building Society
• Legal & General Home Finance
• LendInvest Mortgages
• LiveMore Capital
• Lloyds Bank
• Mansfield Building Society
• Metro Bank
• Nationwide Building Society
• NatWest
• NatWest Intermediary Solutions
• Newcastle Building Society
• Penrith Building Society
• Post Office Money®
• Precise Mortgages
• Royal Bank of Scotland
• Santander
• Scottish Building Society
• Scottish Widows Bank
• Skipton Building Society
• The Co-Operative Bank
• The Co-Operative Bank for Intermediaries
• The Mortgage Lender
• Together
• TSB
• United Trust Bank
• Vida Homeloans
• Virgin Money
• Yorkshire Bank
• Yorkshire Building Society

Scottish mortgage applications are very much the same as in England and Wales. The documents you need to supply are:

• A minimum of three months’ bank statements
• Three months’ of payslips from your employer or three years’ of audited accounts for those who are self-employed
• Evidence of regular rent payments (if you are currently renting) or 12 months’ worth of mortgage statements (if you already own your own home)
• Information on your current home insurance (contents only for those renting or both buildings and contents for homeowners)
• Details of any life endowment policies you currently hold.

Solicitors in Scotland have a much larger part to play in the whole process of property selling and purchasing.

For a start, Scottish solicitors are often active in selling homes – much as estate agents are in England. It is not at all unusual for a Scottish solicitor to advertise properties they have for sale, as well as acting as legal representatives. 

Someone intending to sell their property will contact a solicitor first – from here the solicitor will carry out checks to confirm the title of the property before putting it on the market. To do this, the seller has to provide the solicitor with the title deeds.

Often the solicitors involved will arrange a survey for the property (see the section on Home reports below) that is being sold, along with any other documentation needed. They will also handle the logistics of sealed bids, negotiation with the buyer’s solicitors, and preparing any other documentation.

Buyers must also engage the services of a solicitor early in the house hunting process. However, with solicitors often advertising property for sale, this is naturally the case anyway.

Solicitors will carry out a number of standard searches, checks and other elements of the conveyancing, including but not limited to:

• Land Registry searches
• Verifying that the title deeds are all in order and correct
• Agreeing the final date of entry
• Any other paperwork, including the all-important missives.

In another change to house buying in the rest of the UK, properties in Scotland are usually advertised for an exact price or ‘offers in excess of…’, instead of the more usual specified price south of the border. Hence, if a property is on the market for offers over £300,000, then you will be expected to make an offer that is over £300,000. Making an offer that is less than the specified amount means that it will likely not even be considered. Where a seller is prepared to accept ‘offers around’ a particular price it infers they are willing to negotiate on the price.

Offers are made in the form of sealed bids and are prepared by your solicitors. Offers must also include your proposed ‘date of entry’ when you will pay, and the property becomes yours. Hence, house sales often have a date by which all bids must be made – this is called the ‘closing date’.

It is the seller’s solicitor who collects all the sealed bids and will then pass them onto their client. Unlike in a traditional blind auction, the seller will choose which offer to accept, meaning that it is not necessarily the highest bid that will win.

Once the seller has accepted an offer and suggested date of entry, then things can move a bit faster than elsewhere in the UK. The buyer will have to formalise their mortgage and the solicitors will attend to the Land Registry transfer, requesting funds from the mortgage lender and any other legal requirements.

Due to the differences between the Scottish and English methods of house sales, home purchases in Scotland tend to fall through less often than in England. This is most likely because selling your home involves laying out money for a ‘Home report’ (see below). 

Happily, the unpleasant act of gazumping is hardly ever seen in Scotland. This is due to the fact that when an offer is made, the house is taken off the market. This leaves no opportunity for someone else to see the house and make a higher bid.

In addition, solicitors cannot continue to represent a seller who goes with a different buyer, meaning gazumping is not encouraged.

In Scotland, the seller is required to have a ‘Home report’ prepared before they even put the property up for sale. This applies to all residential properties, except those that have been converted to residential use and new builds.

This ‘Home report’ contains both a survey and details of the premises’ energy efficient rating. It will also contain a standard questionnaire filled out by the seller. These reports help to keep down the number of sales that fall through, due to buyers having more details to hand before they think about making an offer.

The seller pays for this report, but buyers can have a separate survey undertaken, although only after their offer has been accepted.

In Scotland, there is no stamp duty on residential home purchases. Instead, buyers will have to pay Land and Buildings Transaction Tax (LBTT). Unlike in England, where stamp duty starts for homes valued over £250,000, in Scotland, the LBTT is £145,000. In addition, first-time buyers in Scotland will pay LBTT on new properties that are worth more than £175,000.

Buy-to-let and second homes attract LBTT on properties in excess of £40,000.

‘Concluding the missives’ is the name given to the agreement of the sale and the Scottish equivalent of exchanging contracts in England. This is handled by the solicitors representing the buyer and the seller respectively.

Instead of contracts, the legal work is conducted by letters from one solicitor to another – these letters are called ‘the missives’. Hence, concluding the missives is the point at which the sale becomes legally binding on both parties, with the seller passing the legal title of the property across to the buyer. However, if the seller fails to do this, then the buyer may withdraw from the deal and seek damages from the seller.

During the exchange of missives, the buyer’s solicitor will deal with agreeing an entry date (see above), any legal enquiries about the property, and confirm the details of the mortgage with the lender are correct, etc.