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Vendors pull out AFTER exchange of contract
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peachyprice wrote: »Well that's just bloody awful.
Why awful? It makes perfect sense!0 -
It's fine if your vendor is solvent and has plenty of equity in the property he's selling.
It's less fine if your vendor is teetering on the edge and may commit his (your) deposit to his own purchase but perhaps not be able to complete. He then loses his deposit on his purchase, etc, and you as the buyer end up owed a large chunk of money by someone who simply does not have it.
Hands up anyone who does a credit check on the people selling them their house?No reliance should be placed on the above! Absolutely none, do you hear?0 -
It is the way chains operate in England & Wales. Deposits are passed along the chain at exchange and the remainder of the money on completion.
Deposits are only allowed to be used in this way. Anyone not buying is not allowed to go on a spending spree with their buyer's deposit, but it is held in the seller's solicitor's client account.I'm a Forum Ambassador on the housing, mortgages & student money saving boards. I volunteer to help get your forum questions answered and keep the forum running smoothly. Forum Ambassadors are not moderators and don't read every post. If you spot an illegal or inappropriate post then please report it to forumteam@moneysavingexpert.com (it's not part of my role to deal with this). Any views are mine and not the official line of MoneySavingExpert.com.0 -
In GDB2222's example there are still two people with claim to the same money. That it's now held in the client account of C's solicitor doesn't help A, the poor FTB at the bottom who parted with his hard earned in the first place.It is the way chains operate in England & Wales. Deposits are passed along the chain at exchange and the remainder of the money on completion.
Deposits are only allowed to be used in this way. Anyone not buying is not allowed to go on a spending spree with their buyer's deposit, but it is held in the seller's solicitor's client account.
Basically the system relies upon people completing after exchange. If B fails on both this sale and purchase through lack of funds the FTB is going to get shafted as C has his deposit and is entitled to keep it due to B's defaulting.
A can sue B but if there is no money left and B gets repossessed
I think the point is the solicitors should check there is enough money available before they allow exchange to happen. So the system banks on this worst case never happening.
But then they haven't met Welshwoofs vendor. Still at least Welshwoof's deposit hasn't been passed up a chain
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Like I said, I'm just astonished that it works almost all the time. I guess most people don't even know what's going on.No reliance should be placed on the above! Absolutely none, do you hear?0
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It never rains but it pours
http://forums.moneysavingexpert.com/showthread.html?t=1815053
Another person exchanging but not completing0 -
It never rains but it pours
http://forums.moneysavingexpert.com/showthread.html?t=1815053
Another person exchanging but not completing
Yup - I never thought I'd say this, but I'm currently counting myself lucky! That OP's situation is an absolute nightmare! I'd not even trust the woman at the bottom to have enough money to dig herself out being that she's come out of a bankruptcy.
There surely has to be a better way to do things than this...it can all tumble down like a house of cards.“Don't do it! Stay away from your potential. You'll mess it up, it's potential, leave it. Anyway, it's like your bank balance - you always have a lot less than you think.”
― Dylan Moran0 -
Welshwoofs - heard any more news today?0
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Welshwoofs wrote: »There surely has to be a better way to do things than this...it can all tumble down like a house of cards.
I guess you need a credit report on both your buyer and your seller before exchanging contracts. Now that is going to set the cat amongst the pigeons!No reliance should be placed on the above! Absolutely none, do you hear?0 -
Heartless I know, but I'd write back, as you didn't think about your children, why should I? They've tried to buy a new build and it didn't pass valuation, why didn't they go back to renegotiate with the builders. As it is they will lose the deposit they have put down on this new build, as well as be liable for estate agents fees, your costs and compensation.
They are in big trouble. I would suggest renting out your house to them, but they may not take too kindly to this suggestion.
AMDDebt Free!!!0
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