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This guide helps walk people through the process of power of attorney/lasting power of attorney (LPA) as it applies to selling any type of freehold or leasehold property. LPA is used to give a specific person or people authority to sell a home on behalf of a relative or friend who is mentally unable to handle the sale alone, and there are many important steps involved.
We strongly suggest you seek qualified legal guidance before making any decisions and do not rely on information provided by us.
- What does it mean to have power of attorney/lasting power of attorney?
- Steps involved with being able to sell a property with power of attorney/LPA
- Selling a house or flat when the LPA is shared by more than one person
- Handling the proceeds from the sale of a house or flat with LPA
- Four strategies for selling a property with power of attorney/LPA
- Top queries and answers about selling a home with power of attorney/LPA
What does it mean to have power of attorney/lasting power of attorney?
Many home selling situations involve someone making the decision to seek a buyer for their property and then using the proceeds however they want once it sells.
But there are a large number of scenarios where the person that owns the house or flat might not have full mental capacity to handle the many important choices that are involved with selling a home, including the administrative tasks, deciding which method to use for attracting a buyer and more. A solution that is often used is to give a trusted relative or friend power of attorney or lasting power of attorney (LPA) to handle the sale of the home on behalf of the owner.
There are other types of power of attorney but this guide focuses on LPA, which is used primarily in cases where the homeowner can no longer handle their property affairs.
It’s a responsibility often assigned when someone is struggling with medical problems that make it hard or impossible for them to do important actions like selling their home.
A common situation where this can happen is when an aging parent who is starting to suffer from dementia is no longer able to fully make all their financial and property decisions. In this case, their family members might be looking to sell the parent’s house or flat in order to use the proceeds from the sale to help pay for long-term support for them in a care facility. Having power of attorney/LPA can help remove some legal hurdles with trying to sell the property.
The UK government’s website has a guide for people on how to appoint an LPA, explaining that it allows some to select people that they trust – known as attorneys – that will have the authority to make certain financial, property, health or welfare decisions for them.
Steps involved with being able to sell a property with power of attorney/LPA
Selling a property when you have LPA/power of attorney will necessarily be more complicated than the more straightforward process of trying to find a buyer for your own home.
There are a number of important steps that must be met in order for someone who has been appointed power of attorney/LPA to sell a property on behalf of another person, as the law firm Roche Legal explains. Failing to ensure that all of these elements have been met could raise questions about the validity of the sale, which is a situation you want to avoid.
First you will have to ask if the homeowner has the mental capacity to handle the sale of their home. If they do, having an LPA in place can still be a good idea to give you the legal ability to proceed with the sale should the owner’s mental condition start to deteriorate. If the person’s mental capacity is diminished, the terms of the LPA can then take effect and put you in the position of being able to make the important decisions on how to sell the property.
If there is no LPA in place then you will need to apply to what’s known as the Court of Protection and ask to be made a deputy to handle the sale of the home, or to be granted a court order that authorises you to sell the property. The complications and time involved with this process can be a major hurdle to selling, and that’s why having an LPA in place first is highly recommended.
In order to sell a property through an LPA, you must be specified as the attorney by the person that owns the home, and the LPA needs to be registered with the Office of the Public Guardian.
For those scenarios where you are the joint owner of a house or flat with a partner and you are the sole attorney designed through the LPA, you will need to have a second attorney in place, and a legal professional can help you through the steps involved with achieving this.
Once all these conditions are met, you will be able to move ahead with the sale of the home. Remember that these rules apply to the sale of any type of home using LPA, whether it’s a leasehold flat, freehold detached house or any other type of property, so be sure that you comply with them fully.
Selling a house or flat when the LPA is shared by more than one person
One potential hurdle that you might encounter when trying to sell a flat or house with the power of attorney/LPA is if you’re not the sole person who has been given this responsibility.
There can be situations where the LPA is shared among two or more people, as SAM Conveyancing notes, creating questions about how this affects selling a home.
The LPA might require that all decisions to do with selling the property are to be made jointly, which means that every person designated as an attorney needs to be consulted before any final choice can be made. Alternatively, the LPA may allow some decisions to be made jointly and severally, meaning some choices you can make on your own without consultations.
In order to prevent any potential challenges to actions that you take with the sale of the property from other attorneys listed under the LPA, you should consider consulting with a solicitor or other legal expert who can tell you your exact obligations to check with the other attorneys.
Ideally, you will ensure that the when the LPA is first being written that it outlines clear responsibilities and powers for the various people that might be listed as attorneys.
Handling the proceeds from the sale of a house or flat with LPA
If you have been given power of attorney/LPA and have been tasked with selling a house or flat that someone once owned, one question you might have is what happens with any money that might be made through profit from the sale of the home.
It’s possible that the specific terms of the order that granted you with LPA directs exactly how the proceeds from the sale of the property must be handled. For example, this could include using the money to pay for the long-term care of the owner.
But if the various legal documents that set out your authority as LPA do not specify how to handle any profit that you might make from the sale of the person’s house or flat, it will be up to you to make that decision. And generally, you should act in the best interests of the person that owned the home that you are now selling, as the law firm Lupton Fawcett says.
There is no simple rule for what would and would not qualify as being in someone’s best interests, but some clear examples can include improving the care that they receive for the end of their life, paying their ongoing bills and other expenses, and more.
You should endeavour to meet this duty for using the proceeds in the best interests of the property’s owner because there could be situations where family members or others disagree with how you spend the money, and they may pursue court action against you. Avoiding such an outcome will help with reducing the expenses and stress involved with selling the home.
Four strategies for selling a property with power of attorney/LPA
When you are confident that all of the various tasks have been achieved before selling someone’s property with power of attorney/LPA, then next choice you will be required to make is deciding on which approach you would like to use to attract buyers to the home.
The four usual options are selling with an estate agent, selling at a property auction, selling to a quick home buyer or selling without any help. Some of these selections have clear benefits, like being able to complete the sale within weeks when you contact a quick buyer. Others have notable drawbacks, like paying commission when you sell via an auctioneer or estate agent.
Think about writing down your main aims with the sale of the property, such as whether you want a method that charges commission, how long you are prepared to wait to find a buyer and the ideal sale price for the home. Then compare these factors against the specific details of the four options below and this should help with narrowing down the choices to the best match.
Selling with an estate agent
If you are looking to reduce your workload when selling a property with LPA then an estate agent can be a good choice because they will be responsible for most of the actions needed.
This starts with putting together a listing that features photographs of the inside and outside of the home as well as a description of its main elements, then advertising this online, in local newspapers and in their office. They will schedule viewings to give interested people a tour of the home and then hear offers from buyers, aiming to take one to exchange of contracts.
For handling all of these tasks, the typical estate agent will charge you commission in a range from 1.15 percent to 1.40 percent of the property’s eventual sale price. This will cause your expenses to rise because the fee will be subtracted from the final sale proceeds.
If you are aiming to sell the property as quickly as possible then you might want to review some of the other selling methods because estate agents can take a long time to find a buyer. Don’t be surprised if a year passes before you are able to complete the sale of the property.
Selling at a property auction
Auctioning any type of home can sometimes be a gamble because there is no promise that the property will actually sell. If you get zero bids on the home then it remains unsold and you would have to begin again after the auction with trying to find a buyer, possibly adding much more time to the selling schedule.
You’ll pick a reserve price, which is the lowest price at which you agree to sell the home, and hope that people will place bids at values far above it, resulting in a decent profit. But you may only get a single bid at the reserve price, and this is considered a binding legal agreement to sell the property that the bidder could sue you to enforce in the event that you try to walk away from the sale after the auction. That’s why you must calculate a reserve price that should produce a profit even after you have paid the auctioneer their commission after the sale.
This fee covers the auctioneer’s work which includes creating and advertising a listing for the property, hosting the auction and then overseeing the completion of a successful sale.
Expect the auctioneer to charge commission at about 2.5 percent of the property’s sale price and this fee will be taken out of the proceeds right away, adding to your expenses. You might be able to negotiate a lower rate of commission with some auctioneers or have them charge the buyer a share of your costs, so it’s always worth inquiring about this possibility.
Selling through an auction is not a fast process, with delays including a wait of several weeks or months between the day that you decide to sell the property this way and the day on which the auction takes place. Then, if the home sells at the auction, the buyer has about 28 days to sign the required legal documents and complete their other tasks needed to finalise the purchase.
There are some auctioneers that might give buyers even more than 28 days, making a sale even slower, whereas others could be open to setting a shorter deadline if you ask for one.
Selling to a quick home buyer
Perhaps the speediest way to sell a property with LPA is by contacting LDN Properties or another quick buyer. These companies can complete the process of buying a home within weeks, and that covers the final stages of exchanging contracts and paying you the proceeds.
These businesses are able to move so fast because they already have the financial resources in place to buy the home, without having to wait weeks or months to initially get approved for a mortgage to cover the cost of the transaction. That makes selling this way much swifter than any of the other three methods, which can all often take at least many months if not longer.
Quick buyers are also well known for never charging any commission to sellers, so you will be guaranteed to receive the full proceeds that you can then spend in the best interests of the property’s owner. That’s favourable compared to selling through an auction or with an estate agent because both of those methods will require that you pay them commission, and the fee will increase your net selling expenses because it is taken out of the final sale proceeds.
If you are trying to sell a home with LPA that might be considered a “problem” property because of structural damage or any other negative element, a quick buyer is yet again a great choice as they make fair and fast offers to buy practically any type of home no matter its age, condition, location, shape, size or type, and regardless of the extent of any flaws that it might have.
One tip to pursue when selling to a quick buyer is asking individual companies if they belong to an organisation called The Property Ombudsman (TPO). This independent organisation writes rules to shield owners from fraud in the quick buying sector, and all genuine TPO members such as LDN Properties must follow these rules, giving sellers extra peace of mind.
It’s easy, quick and free to check the membership status of any quick buyer – just visit TPO’s website and click on the “Find a Member” tab on the left side of the home page, then type in the name of a specific company. If they are genuinely registered with TPO, like LDN Properties, then you will see their full membership details, but it they are not members then you’ll get zero results. Never sell to a company that isn’t a TPO member because it could be a scam business.
Selling without any help
One of the more stressful ways to sell a house or flat with LPA is doing so without any assistance because this puts the burden on you to handle every task needed to find a buyer. It begins with making and advertising a listing, then it continues to organising viewings and hearing offers from people and finally trying to get an offer to the exchange of contracts.
It can be an intense amount of work, especially on top of your other responsibilities with power of attorney, and it might take up a lot of your time. That’s why it’s only suggested for people that have previously managed to sell a similar property, or who might have a suitably skilled family member or friend that is willing to assist with the selling process at no charge. Otherwise, it could more than an entire year before you are able to finally succeed in the selling the home.
And someone could make a legitimate offer but then cancel it later, which would make the sale break apart. They are able to do this without facing any penalties so long as you have not yet exchanged contracts. And this scenario would inevitably extend your selling timeline much further because you would have to start over with seeking a buyer for the property.
The only notable advantage of selling without any assistance is that you will not need to pay any commission to an auctioneer or an estate agent, which helps with reducing the expenses. But this saving might be wiped out by the money that you will have to spend on marketing the property’s listing and the various other steps involved with trying to find a buyer for it.
Top queries and answers about selling a home with power of attorney/LPA
LDN Properties launched more than 20 years ago and can help when selling with a power of attorney / LPA, and below are our answers to frequent questions.
Your top questions when selling a property with power of attorney
Lasting power of attorney (LPA) is a process through which someone that owns a property can assign a trusted relative or friend to a position known as attorney, giving them the legal authority to handle certain property and financial affairs like selling the owner’s home. It’s often used in situations where the owner no longer has the mental capacity to handle these tasks.
If there is no LPA in place then you will need to seek an order from the Court of Protection to allow you to proceed with trying to sell someone’s home. But if you have an LPA then the other important steps to take include registering it with the Office of the Public Guardian, having full legal authority to pursue the sale of the home and selling in the best interests of the owner.
Yes, you are still able to proceed with the sale of a person’s property when the LPA/power of attorney is shared among two or more people, but there could be some additional steps to go through. Check with a legal professional as in some cases you can make property sale decisions alone whereas other scenarios may require consulting with the other people.
In many cases, the LPA/power of attorney documents will specify how any profit made from the sale of a person’s property is to be spent. But if there are no clear instructions for how to spend such proceeds then you as the attorney are expected to use the funds in the best interests of the property owner, for example by using them to pay for their long-term stay in a care home.
By far the fastest way to sell practically any category of freehold or leasehold property is by contacting LDN Properties or another quick buyer, as they should only take a handful of weeks to complete all the important steps such as exchanging contracts any paying you the full proceeds. All other methods of selling a home will often take several months or longer.
Only if you choose to sell the property using the services of either an auctioneer or an estate agent, because they will make you pay commission that will be subtracted from the final sale proceeds. But if you instead opt for selling the house or flat without any such assistance, or you sell to a no-fee quick buyer such as LDN Properties, then you will not pay any commission.
For additional peace of mind, you can ask quick buyers if they can prove they are registered wit The Property Ombudsman (TPO), an independent organisation that writes rules to guard owners against scams in the industry. All TPO members, like LDN Properties, commit to following these rules, so that should you give you assurance when selling to them.
