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5. What should a purchaser be aware of if there is an existing mortgage on the flat before he/she signs the provisional sale and purchase agreement?

The provisional agreement and the formal agreement should provide that the flat is to be sold to the purchaser free from all encumbrances including the existing mortgage.


The purchaser's solicitor will ask the vendor's solicitor to undertake to make sure that:


  1. the vendor pays off any existing mortgage; and
  2. the vendor's solicitor will give the discharge documents (bank documents showing that all mortgages have been paid off) to the purchaser's solicitor within a certain number of days after completion of the purchase (i.e. after payment of the purchase price by the purchaser).