Vendors pull out AFTER exchange of contract

zzzLazyDaisy

It is extremely unlikely because it is standard practice to confirm immediately before exchange - because at exchange the completion date is also agreed.

However, if that is what has happened, the vendor would have a claim against the solicitor, but it wouldn't change their obligation to the buyer.

YMoney

We have exchange contract recently on a new developer. Our property is one of 4 and we were the first one to put an offer. We tried getting a discount but were only given £15k from the asking price. Before we exchange we had an issue with the mortgage as were getting £35k less than we need, we then went back to the developer and request if they could try and give us a further discount and there were adamant that they have given us as mush as they could. They also informed us as we were the first one putting the offer we are getting a better discount and no such discount will be given to the other three property. Now that we have exchange we found that the developer are advertising 'house of the month' where they are giving £40k discount plus stamp duty, £1k legal fees and carpet throughout the property. The issue here is that we had to go to another lender who will give us what we need (addtional £35k) and this come at a price i.e. high interest... we are really angry that the developer are giving such a massive discount. What are our options? Can we pull out and still get some of our deposit back. Deposit paid is nearly £100k. Any advise would be helpful.

Yorkie1

Yasmin, I suggest you start your own thread as your question relates to whether you can pull out from a sale, and is not about the title of the thread.

GDB2222

yasmin_afshur wrote: »

We have exchange contract recently on the new developer. Our property is one of 4 and we were the first one to put an offer. We tried getting a discount but were only given £15k from the asking price. Before we exchange we had an issue with the mortgage as were only getting £35k less than we need, we then went back to the developer and request if they could try and give us a further discount and there were adamant that have given us as mush as they could. They also inform us as we were the first one putting the offer we are getting a better discount and no such discount will be given to the other three property. Now that we have exchange we found that the developer are advertising 'house of the month' where they are giving £40k discount plus stamp duty, £1k legal fees and carpet throughout the property. The issue here is that we had to go to another lender who will give us what we need in but this come at a price i.e. high interest... we are really angry that the developer are giving such a massive discount. What are out options? Can we pull out and still get some of our deposit back. Deposit paid is nearly £100k. Any advise would be helpful.

You will lose all your deposit if you back out. In theory, the developer can also sue you for other expenses they may incur, although they may not bother.

I am sorry that you have apparently overpaid for this property, but you cannot now back out of the contract without it costing you a mint.

You may possibly have some comeback against the surveyor who valued the property at the higher figure for you. However, you should be aware that valuing properties is not an exact science, and the courts will generally allow leeway of 10%.

YMoney

i know we will probably loose all our deposit but the developer basically go back on what they say.... we are just heartbroken that we have overpaid and all the excitement has gone to be honest. The worst thing is that no one has actually put an offer on the other three property and they convince us that we are getting the best discount. just don't know what to do!

jackomdj

Overpay by £35k or lose £100k, i know which I would rather do!

Probably they have had to reduce if no interest in the other properties.

pinkshoes

yasmin_afshur wrote: »

i know we will probably loose all our deposit but the developer basically go back on what they say.... we are just heartbroken that we have overpaid and all the excitement has gone to be honest. The worst thing is that no one has actually put an offer on the other three property and they convince us that we are getting the best discount. just don't know what to do!

The developer hasn't gone back on his word. He sold the houses for the highest price he could achieve.

Ultimately, when the valuation came in £35k UNDER the price you'd offered, this should have set alarm bells ringing, so when they wouldn't reduce it further, you should have walked away.

Rather than looking for someone else to blame, accept responsibility, and if you really don't want to live there, put it back on the market immediately, undercut their current price, and take say a £50k loss rather than £100k deposit + costs.

How much was the house??

john_white

yasmin_afshur wrote: »

i know we will probably loose all our deposit but the developer basically go back on what they say.... we are just heartbroken that we have overpaid and all the excitement has gone to be honest. The worst thing is that no one has actually put an offer on the other three property and they convince us that we are getting the best discount. just don't know what to do!

Well it;s simple really

Pull out and lose 100k+
Stay in the and be in a house that MAY be worth less than you paid.

Financially which is worse?

The surveyor told you it was worth less than your offer and ignored that advice.

The asking price was x and it was valued 50k lower (15k+35k) and now they are offering 40k discounts, so the surveyor knew what he was talking about.

GDB2222

If the deposit was 10%, the house is £1m. Is stamp duty 4% at that level?

YMoney

that is not the case at all. they gave us a discount of £15k and told us that that is the best discount. We had an issue with our mortgage as they the mortgage were giving us £35k less. We then went back to the developer (before exchange contract) and request if they can help us but they come back and said that that is the maximum discount they can give as we were the first one to offer. At this time we had the option to pull out but we opt out for another bank who will give us the additonal £35k but at a slightlyhight rate of interest. What we are upset about is the fact that they told us that no further discount and now reducing the other property and giving discount of £40k. I just cannot beleive that they can do this just after we exchange. I am sure there is law against this sort of thing ... but then again there is nothing in writing so they can reduce it if they cannot sell it but were told that they will never to this and they convince us that it would be better to put an offer now. We would have waited.... I am ok if they have reduce it slightly but the total reduction including the stamp duty etc is £77k but plus carpet and we had to pay additional £5k for our carpet.... We feel cheated!