quick question about exchanging contracts!!

stolt

hi, about to exchange contracts and we have had to pay a 10% deposit which i understand we would lose if we were to pull out now. What is in place to stop the vendor pulling out of the sale?

missworks2jobs

I dont actually know! We've just sold our flat, and if we backed out last minute we would have wasted the £250 for the HIPS pack and there was a clause in the estate agents fees saying we would have still had to pay them. I suspect the solicitors would still charge the vendor a good 90% if not all of their charges. So hopefully all these fees will put them off changing their mind.

Have you checked the small print in your mortgage offer/application.....it should say there what happens to the 10% deposit if the vedor drops out last minute.

Good Luck, we've just sold too - but are squished in with family at the mo, we didnt even have chance to hunt for somewhere to rent!

stolt

missworks2jobs wrote: »

I dont actually know! We've just sold our flat, and if we backed out last minute we would have wasted the £250 for the HIPS pack and there was a clause in the estate agents fees saying we would have still had to pay them. I suspect the solicitors would still charge the vendor a good 90% if not all of their charges. So hopefully all these fees will put them off changing their mind.

Have you checked the small print in your mortgage offer/application.....it should say there what happens to the 10% deposit if the vedor drops out last minute.

Good Luck, we've just sold too - but are squished in with family at the mo, we didnt even have chance to hunt for somewhere to rent!

I was just readign another thread about a sale falling through with the vendor pulling out and it made me think what if (a bit late i suppose now) but if the seller change their mind have they got anything to lose apart from a couple of grand on fees, whereas we would lose our 10% deposit if we walked away and that is alot more too lose.

good luck with your sale, i cant wait to move in!!

Gwhiz

If this is a deposit before exchange then you only lose the deposit if YOU pull out for no good reason. If they pull out, then there is no sale, so you get your deposit back.

If it's at exchange then you have a binding contract now. If they pull out you can sue them for breach.

stolt

so there is nothing else from the vendors point of view that could stop them from pulling out if the contracts were exchanged alread! worrying now! So the only threat to them if they pull out is me suing them. hmmm dont sound right though does it, i have stump up 10% and they only have the threat of legal proceedings if they pull out. i would have thought that if the exchange was a legal document and it had been signed by both buyer and seller then what is 10% to gaurantee?

princessamy86

It's very watertight usually, I bet there's a clause in your contract that says something like however many days over the agreed completion date the vendor goes over, they have to pay some kind of financial penalty. Also, the deposit is held by your solicitor and the money all goes through at completion. Don't worry, it's very very rare that people pull out after exchange.

Richard_Webster

Have you checked the small print in your mortgage offer/application.....it should say there what happens to the 10% deposit if the vedor drops out last minute.

The mortgage has nothing whatever to do with the 10% deposit. What happens to this is governed by the terms of the contract which both parties sign and which is then exchanged.

Lenders are only involved to the extent that they say they will only lend 75-90% of the price/value and you have to find the rest yourself.

Georgie4

stolt wrote: »

so there is nothing else from the vendors point of view that could stop them from pulling out if the contracts were exchanged alread! worrying now! So the only threat to them if they pull out is me suing them. hmmm dont sound right though does it, i have stump up 10% and they only have the threat of legal proceedings if they pull out. i would have thought that if the exchange was a legal document and it had been signed by both buyer and seller then what is 10% to gaurantee?

If you look at the whole house buying / selling scenario then nothing from either side is right !! For sellers offers made should be legally binding and buyers should not be able to reduce the offer or withdraw it unless the surveyor shows something dodgy and from a buyers point of view the seller should lose out if they withdraw from the sale - over and above paying the estate agents fees ! Whole system needs an over haul