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  • FIRST POST
    • rough3b
    • By rough3b 8th Mar 17, 4:32 PM
    • 7Posts
    • 1Thanks
    rough3b
    mortgage shortfall
    • #1
    • 8th Mar 17, 4:32 PM
    mortgage shortfall 8th Mar 17 at 4:32 PM
    hi need a bit of info im buying ahouse and the owner has a mortgage shortfall.he paid £240000 for it 10years ago,it is now in a poor state of repair ,new roof needed rewiring,all new windows no heating ,damp and a few more things.i paid £180000 for it so he has a shortfall of £60000 plus any otherdebt he may have on it he noe livives in NZealand my solicitor says she does not know how long the shortfall will take to sort out we were planning to move in on 23 march our house is sold aswell,surely this problem should of been noticed the minute our offer was accepted 2 months ago starting to think about pulling out would love anybodies advice or knowledge or experience about this thank you
Page 1
    • foxy-stoat
    • By foxy-stoat 8th Mar 17, 4:39 PM
    • 1,535 Posts
    • 829 Thanks
    foxy-stoat
    • #2
    • 8th Mar 17, 4:39 PM
    • #2
    • 8th Mar 17, 4:39 PM
    Not sure how you know how much his mortgage is.


    If he paid £240,000 for it 10 years ago and bought it on an interest only mortgage at 100% LTV and hasn't made any overpayments then the bank will not let him sell it for £180,000 without a cash injection at or before the point of sale.


    Have you exchanged contracts yet and is your completion date the 23rd March?
    • MyOnlyPost
    • By MyOnlyPost 8th Mar 17, 4:39 PM
    • 1,512 Posts
    • 1,013 Thanks
    MyOnlyPost
    • #3
    • 8th Mar 17, 4:39 PM
    • #3
    • 8th Mar 17, 4:39 PM
    The fact he paid £240,000 for it and you are buying it for £180,000 doesn't mean he has a £60,000 shortfall.

    He would have probably had to pay a deposit when buying which could be 5, 10, 20% etc. He has also been paying down the mortgage all the time has has owned it (assuming not interest only). In reality the shortfall might only be a few hundred or a few thousand pounds and he may have that in savings to cover it.
    It may sometimes seem like I can't spell, I can, I just can't type
    • sparky130a
    • By sparky130a 8th Mar 17, 4:40 PM
    • 429 Posts
    • 582 Thanks
    sparky130a
    • #4
    • 8th Mar 17, 4:40 PM
    • #4
    • 8th Mar 17, 4:40 PM
    I'm completely lost.
    • ReadingTim
    • By ReadingTim 8th Mar 17, 6:07 PM
    • 1,301 Posts
    • 1,787 Thanks
    ReadingTim
    • #5
    • 8th Mar 17, 6:07 PM
    • #5
    • 8th Mar 17, 6:07 PM
    I'm completely lost.
    Originally posted by sparky130a
    The vendor's in negative equity therefore his/her mortgage lender won't release their charge over the property until a plan has been agreed to make up the shortfall.

    The OP can't complete until the charge has been released.

    At least that's what I think the OP is trying to say. Had they used the right words, in properly spelled and punctuated sentences, we'd be able to provide answers, rather than still trying to guess what the question is....
    • Hoploz
    • By Hoploz 8th Mar 17, 7:39 PM
    • 3,407 Posts
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    Hoploz
    • #6
    • 8th Mar 17, 7:39 PM
    • #6
    • 8th Mar 17, 7:39 PM
    There's really nothing you can do about this. If the solicitors cannot give a timescale for its resolution you'd better look elsewhere.
    • G_M
    • By G_M 8th Mar 17, 8:04 PM
    • 38,437 Posts
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    G_M
    • #7
    • 8th Mar 17, 8:04 PM
    • #7
    • 8th Mar 17, 8:04 PM
    ".i paid £180000 for it"

    Let's hope for your sake that this is not true.

    Have you either

    a) Exchanged contracts and/or

    b) Completed

    ??

    Now re-post, using short clear sentences, with full stops.

    Remove irrelevant information (eg what he has spent on the property).

    And then ask you question.
    • rough3b
    • By rough3b 8th Mar 17, 8:25 PM
    • 7 Posts
    • 1 Thanks
    rough3b
    • #8
    • 8th Mar 17, 8:25 PM
    • #8
    • 8th Mar 17, 8:25 PM
    sorry about the spelling didnt have my glasses ,we were hoping to complete this friday but the shortfall hasnt been sorted out yet ,then my solicitor moved it back to the 23 of march but then informed me today that it might take longer.i had an offer of 180,000 accepted over 2 months ago and i would of thought the shortfall problem might have shown up earlier in the buying process
    • rough3b
    • By rough3b 8th Mar 17, 8:52 PM
    • 7 Posts
    • 1 Thanks
    rough3b
    • #9
    • 8th Mar 17, 8:52 PM
    • #9
    • 8th Mar 17, 8:52 PM
    we were due to complete this friday the 10th but that got put back till the 23rd of march ,then i was informed by my solicitor today that it may now take longer,im a bit confused why my solicitor keeps giving me dates to complete when she doesnt know herself instead of just saying dont do anything yet,im practically all packed up and have stuff in storage because she the 10th is going to be possible.
    • TBagpuss
    • By TBagpuss 8th Mar 17, 9:23 PM
    • 5,301 Posts
    • 6,965 Thanks
    TBagpuss
    Have you exchanged contracts?

    The seller would need to either come to an arrangement with his lender, that they will release their charge over the house even though the mortgage isn't cleared in full (in which case the seller will end up owing the money as an unsecured debt)

    or he will have to fund the shortfall from savings or other borrowings,

    or the sale will fall through because you can't go ahead and buy it unless you can give your mortgage lender a first charge over the property .
    • AdrianC
    • By AdrianC 8th Mar 17, 9:38 PM
    • 13,183 Posts
    • 11,522 Thanks
    AdrianC
    we were due to complete this friday the 10th but that got put back till the 23rd of march ,then i was informed by my solicitor today that it may now take longer,im a bit confused why my solicitor keeps giving me dates to complete when she doesnt know herself instead of just saying dont do anything yet,im practically all packed up and have stuff in storage because she the 10th is going to be possible.
    Originally posted by rough3b
    OK, I think we can presume you've not exchanged contracts - a completion date would be set at exchange.

    So, as yet, you've not actually "bought" anything. And, if your solicitor has a quarter of a brain in their head, you won't be doing until the vendor can come to an agreement with their lender over the shortfall, however much it may or may not actually be...

    Remember, the discussions that this is all hanging on do not involved your solicitor. They are going on between the vendor, their lender and hopefully their solicitor. The EA might be in on the discussions, but probably not. Your solicitor is getting it second- or third-hand from their solicitor, and is merely passing it on to you. Don't shoot the messenger.
    • G_M
    • By G_M 10th Mar 17, 9:56 PM
    • 38,437 Posts
    • 43,529 Thanks
    G_M
    we were due to complete this friday the 10th but that got put back till the 23rd of march ,then i was informed by my solicitor today that it may now take longer,.....
    Originally posted by rough3b
    You never answered the question as to whether you have exchanged contracts. But it seems very likely that you have not.

    Therefore the sentence "we were due to complete this friday..." is inaccurate.

    Until you exchange contracts any date for Completion is simply a preference Yours and/or the seller's preference. It is not binding, and frequently that preferred date will not be achieved.

    as in this case.

    You cannot Exchange Contracts (and therefore fix the Completion date) until all the legal and financial issues (yours, your seller's, and everyone else's in the chain) are tied up.
    • hazyjo
    • By hazyjo 11th Mar 17, 12:31 AM
    • 8,665 Posts
    • 10,653 Thanks
    hazyjo
    Just wanted to let you know it's never advisable to pack up or give notice (or anything else) until you actually exchange contracts! It could still all fall through...
    2017 wins: Opera tickets; cinema tickets; Ideal Home Show tickets
    • Blackbeard of Perranporth
    • By Blackbeard of Perranporth 11th Mar 17, 5:08 AM
    • 4,158 Posts
    • 24,627 Thanks
    Blackbeard of Perranporth
    If said owner with negative equity can't proffer up the goods, use your legs.
    No one dreams of escape
    From the aroma of a cheap jar of coffee
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