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Paid deposit for off-plan and cannot complete...HELP!
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Ok found it!
http://property.timesonline.co.uk/tol/life_and_style/property/article4913206.ece
Applies to England and Wales only.
If buyer doesn't complete, the seller can end the contract and buyer forfeits deposit.
Statutory protection for the buyer relies on section 49 of the Law of Property Act 1925 which gives the court the power to order the repayment of the deposit.
According to the barrister who wrote the article, the default position is always that if you do not pay the balance of the purchase price you lose your deposit.
There is no mention of the buyer having further liabilities.
Refer to this thread for further discussion on this point
http://forums.moneysavingexpert.com/showthread.html?t=1218203"Now to trolling as a concept. .... Personally, I've always found it a little sad that people choose to spend such a large proportion of their lives in this way but they do, and we have to deal with it." - MSE Forum Manager 6th July 20100 -
Hi,
I am in the same postion as many people who have posted here - although I do not know how my position will unfold. I signed missives on a new build flat in Scotland early 2007 - I was told it will be completed August 2008, I was then told November 2008, February 2009 and the latest completion date given is April 2009. I paid for a valuation got a mortgage in place - at a 0.71 discount to base, the lender was prepared to extend the offer 12 months to February 2009 - that is the longest they would hold. So now no mortgage infact the lender has pulled all deals.
I don't know what to do - the surveyor has told me that they will not be valueing the property at the purchase price - goodness knows in the current climate what the valuation will come in at.
I like others am aware that I could be sued for the difference in resale price. I must add that I don't think it is helpful for some to post to the effect that we should have known better - I am not being critical - but how many people thought the credit crunch would come to this.
What I would like to know is has anyone actually negotiated with the builders re price/completion/been sued. No one has actually posted that they are in the process of being sued. I also know that the builder has to be seen to be reasonable.
Is anyone actually being pursued for the difference is it the full amount or are they agreeing to settle an amount.
Also does anyone know what reasons would be legitimate to get out of signed missives in Scotland0 -
We have pulled out of a deal with Walker Group as we couldn't sell our house. In spite of the current economic crisis, we had to pay them £6000 in addition to the £4000 deposit to get out of the deal.0
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I have to say I used to wince in 2006 - 07 when I heard ads on the radio for off - plans in London (Galliard Homes).
The flats mentioned in this thread have probably lost 40% of value 9check this by calling local EAs and ask the real value to sell now.0 -
I must add that I don't think it is helpful for some to post to the effect that we should have known better - I am not being critical - but how many people thought the credit crunch would come to this.
I agree that it is not helpful to criticise. However, asking how many people thought the credit crunch would come to this is begging for an avalanche of replies. There are many people who have held off buying because prices were far too high for them.
Turning to your query, nobody to my knowledge has posted here that they are being sued for the builder's losses. A month or two ago, I posted a newspaper article about a developer in Plymouth doing this.
In your position, I would seek advice from an independent solicitor (not the one who originally advised you on exchange of contracts).No reliance should be placed on the above! Absolutely none, do you hear?0 -
Technically the builder wouldnt have built the flat if you hadnt ordered it, so you are kind of obliged to pay them for it once its been made.
That said the judge may cut you a break and decide youve suffered enough by losing your deposit, especially if they delayed completion. Its happened before apparently.0 -
If it's a standard new-build contract the OP could be held liable for the difference between the price they agreed to pay and the final sale price, plus advertising costs.
Given that most new-builds are now being advertised for 20% below their peak price from 12 months ago, with big incentives on top of that, the OP is totally and utterly screwed.
This is the next big "consumer rip-off" that will soon be picked up by the press. Not that it will get far.
As it should have been built 18 months ago, shouldn't the liability be only the difference between the price the OP agreed to pay and the price 18 months ago (plus advertising costs etc)?0 -
There are usually clauses in a NB purchase contract that state the developer should complete within a "reasonable" period. Such contracts usually also state that the buyer cannot claim against the developer for any delay in completion.
Overall, it all boils down to the legal definition of "reasonable". I contend (m'lord) that a good solicitor could make a good case that someone waiting for more than a year for a developer to complete is unreasonable (this depends on progress when contract signed). We need a good brief to win a case on this to set a precedent.
Overall, it does seem massively unfair that a NB buyer can be held to contract for an infinite period. Such T&C's are massively biased in favour of the developer, and should be changed.In case you hadn't already worked it out - the entire global financial system is predicated on the assumption that you're an idiot:cool:0 -
In same position in Scotland, signed for two off plan apartments in Dundee to rent out in early 2007 as figures then stacked up, completion date of late 2009 (contract has no set date). No building started as yet (which I think probably helps out in terms of wriggle room as no loss yet to developer) but missives concluded and deposits paid (£13k in total), hoping to move now in case I can do anything--any advice?
However there is a chance developer may hold off until 2010 when we hope things have improved possibly, though may be best to bail out0 -
Update on my post.
The builder has now asked for £52,000 for the flat that was worth £155,000 2 years ago
We resiled the contract more than a year ago now we have to pay them the sum above.
Thats on top of the £9500 we paid in deposit.
A major set back which we probably won't recover from.0
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