Vendors pull out AFTER exchange of contract

Welshwoofs

Well finally got the expected contact and all I can say is.... HRMMM

Are they getting out? No! They're toughing it out it would seem. The communication was long and rambling and apparently written by someone with multiple personality disorder as it seem to swing between self-pity and cockiness.

We got an extremely lengthy explanation of their situation which can be summarised by saying that they appear to be over-extended and with delusions of grandeur. In short, they're hocked up to the nines on an Interest Only mortgage (which we're guessing has just come to the end of a 5yr fixed rate or something given the timing of sale) and paid a deposit to a developer on an off-plan new build. It would seem their mortgage company are not as enamoured of their shiny new build as they are however as they're only willing to lend 75% LTV on a repayment mortgage...which the vendors can't afford to pay on their income.

[Vendor Cluebat #1 - buy a cheaper house!]

So they're not moving because they can't afford the mortgage offered on the house they've paid a deposit on. After that followed a page of general 'oh woe is us' whining about now losing the deposit paid on the new build and having to pay us. From the teenie tiny violin serenaded explanations it launched straight into a suggestion that we simply buy a smaller house in our chosen area (they rather helpfully pointed out that there were lots of 2 bedrooms on the market....which is naturally very helpful when one is buying a 4 bedroomed :rolleyes:). From there they ventured to suggest that we'd never win a Specific Performance suit as they are in financial trouble and have small children...who'd be made homeless yadda yadda. They appear to be labouring under the assumption that we're investment buyers (presumably because it's a cash sale and we're not selling ours) and therefore think a court would side with their 'family' needs.

[Vendor Cluebat #2 - never make assumptions about your buyers]

In fact we're not investors at all and have just as strong 'family needs' as they do.

Another offer was made which, again, was absolutely derisory (covers costs so far, but wouldn't cover costs going forward) and certainly wouldn't make up for the fact that the only equivalent house in the area is £40k more.

So we're having a think about our next move. Heart is saying 'steam in straight on with Specific Performance' but head is saying that it looks like they may be the financial merde and a victory may be a hollow one. On the other hand, with the next equivalent suitable house at an asking for £40k more (and there's no way they'll drop by that with houses moving in a week there) there's also no way we're settling with their offer.

Poppy9

What is your solicitors POV on the situation? Can you not just sue for damages that you need to find an extra £40k due to their stalling and house prices rising again?

Romani_Ite_Domum

Sounds as though they made a very stupid and costly mistake whatever happens. They have my sympathy.

I wish you well WW. Not a position anyone would want to be in. Best of luck!

Welshwoofs

Poppy9 wrote: »

What is your solicitors POV on the situation? Can you not just sue for damages that you need to find an extra £40k due to their stalling and house prices rising again?

You can sue for whatever you like....it comes down to what a court awards and then if they actually have the money to pay up!

furndire

It would have been a good idea if they had come clean right at the begining of this fiasco, instead of trying to be clever and bluff their way out. Typical mentality of people trying to appear more affluent than they actually are.

pulliptears

My mother always said something about "cutting cloth according to your garment" which I guess was her wonderful way of saying live within your means.

If your sellers have money troubles then they should be looking at buying a smaller, cheaper house. If they are in financial trouble then they are going to need to start 'cutting cloth' soon so to speak. Based on that, I'd still go for Specific Performance.

They knew the situation they were in and chose to carry on, lie and then go for emotional blackmail. Personally, I'd see them in court.

bigstevex

My views...
The court should see that they got themselves into that position and shouldn't of exchanged contracts. If the court awards it in their favour then the british legal system is a joke!

If the next house is 40K more I'd just push to get this one. If they get forced to move out then they can go into rented accomodation so they wouldn't be homeless sounds like they are just playing about with your feelings on that one for sure!

Raggie

If their bank has given them a mortgage offer.. (all be it at 75% LTV).. then their bank think they can afford the repayment?????

Is'nt that what this whole credit crunch is about .... banks being tighter on lending criteria.... ??

So it would seem they are choosing not to spend the money rather than not being able to afford...

Thats a different picture to the courts.....

GDB2222

Welshwoofs wrote: »

So we're having a think about our next move. Heart is saying 'steam in straight on with Specific Performance' but head is saying that it looks like they may be the financial merde and a victory may be a hollow one. On the other hand, with the next equivalent suitable house at an asking for £40k more (and there's no way they'll drop by that with houses moving in a week there) there's also no way we're settling with their offer.

The best way forward is a mediation meeting. They say their bit. You say yours. You point out that they are in a hopeless position legally. [You're not investors, etc.] They tell you just how broke they are or want you to think they are. Then, you have 3 choices:-

1. You pay them a bit more and they do move out after all. (Gritted teeth and all that, but you get your life back again.)

2. They pay you a bit to go away and leave them in peace. (Gritted teeth and all that, but you get your life back again.)

3. You steam ahead with specific performance. Although this has potential for going horribly wrong, there is also a possibility that you drive them over the edge of bankruptcy, their house gets repo'd, and you pick it up fairly cheaply from the lenders.

Personally, I'm not a gambler, so I'd try to avoid 3. Besides that, however appallingly these people have behaved, I am not sure that I would want to be responsible for them being bankrupt.

At the moment, you are trying to mediate through letters, and that tends not to work very well in my experience. So, I think you are best to get together as soon as possible.

Pete111

Welshwoofs wrote: »

After that followed a page of general 'oh woe is us' whining about now losing the deposit paid on the new build and having to pay us.

They don't have to pay you (more than the extra costs incurred anyway )

They just have to move out of your house and into rented accomodation asap

They can afford an interest only mortgage but cannot afford the repayments? Utter and total idiots who deserve no sympathy from anyone (though I do feel for their kids who have such prats as parents).

Your call WW but I urge you (for the sake of sensible folk everywhere) to please see this through!

P