Vendors pull out AFTER exchange of contract

epsilondraconis

WW, how about setting up an internet site that allows people to contribute to your legal case?

If there is sufficient publicity surrounding this, perhaps it could bring about a much needed change in the law.

It makes you wonder whether the same thing can happen in other countries or whether they have some kind of safeguards in place that stops this from happening.

pinkshoes

WW will end up out of pocket whichever way it's played.

The crux of the matter is the legal binding contract, so if it goes to court and they win, then they get the home they want, but if they go to court and lose, all hell will break lose, and I'm 99% sure this story will be all over every national newspaper about how you can pull out after exchange, leaving our entire legal system up in the air.

On that basis, I think it's highly unlikely WW would lose in court.

DVardysShadow

Welshwoofs wrote: »

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..

Have you any example of anything else written by their solicitor?
It looks to me like the solicitor may just be topping and tailing the vendors' own rambles.

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.

OK, maybe they have another buyer lined up, or maybe not. Or they could have tried to gazunder the builder - and he is not having it. Or they could be stalling while the build is completed.

[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.

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

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

Yes, it is plain impertinent for them to make assumptions about your position and to start telling you what to 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

Perhaps a visit to your solicitor and a review of the title deeds and charges on the property, specifically the mortgage outstanding, to gauge their equity position - or via the Land Registry, if the solicitor does not have this info. If the equity looks reasonably solid, then it could be worth sueing.

Otherwise, you could offer them a complete out for costs, return of deposit, plus a charge on the house for all proceeds on eventual sale in excess of the contract price. It would certainly address the plight of their offspring [apart from who they were born to].

ILW

DVardysShadow wrote: »

Otherwise, you could offer them a complete out for costs, return of deposit, plus a charge on the house for all proceeds on eventual sale in excess of the contract price. It would certainly address the plight of their offspring [apart from who they were born to].

That would sort out if they were bulls****ng or not.

Ulfar

People on here are mentioning legal costs, do you have cover on you house insurance ?

Are you a member of a union or processional body, sometimes they have insurance for members legal costs ?

barnaby-bear

GDB2222 wrote: »

The problem is the costs. Quite easily £20k per side at first instance. But, if the vendors run a spirited defence, there could be expert witnesses, more experienced counsel, etc, and the costs could be say £50k per side. Then, of course, it can go to appeal....

Assuming the vendors lose, they could easily be presented with a combined bill of £40k - £100k (treble that if it goes to appeal). They could be bankrupted, leaving WW to pick up her own costs. Even if she is successful and the vendors are not bankrupt, she won't get all her legal costs paid.

Litigation is a truly great spectator sport**, but not so good for the participants.

** Rather slow, though. So, you have to be patient.

But she's looking at being 40k out of pocket because of the shift in the local housing market as it is..... is it likely the vendor can fund a spirited fight, would they push themselves towards bankruptcy (they'd not be able to get another mortgage for a long time)?

All the emotive stuff about kiddies and bankruptcy is annoying - if I'd been messed around (remember this was pulled the day before completion - after weeks of p1ssing around where WW had no opportunity to look at alternatives and missed out) I wouldn't care if they had to go and live in rented with their kiddies....

barnaby-bear

Welshwoofs wrote: »

Troubled_Joe - you're echoing the concerns our legals have raised i.e. that we have a strong case, but being right (and even winning) is no guarantee that we won't be left out of pocket.

Lady Hamilton - I'm afraid there is no way on earth we're taking their current settlement offer, it'll leave us in the position where we'll be out of pocket on costs extremely quickly and be unable to purchase any of the equivalent houses for sale at present in the area.

I need to find the line to surf between 'fighting for what's right' and being pragmatic. I don't intend to be a martyr, but neither do I intended to be shafted and hung out to dry just so a couple of spoilt and morally corrupt people can do as they wish without consequences.

With the charge on the LR does this mean they can't sell to anyone else regardless of whether you push for SP or do nothing? What happens if you don't push but that note stays on the LR - is it some weird deadlock?

AMILLIONDOLLARS

From where I'm sitting if I had to pay £20K towards legals I think it would be a bargain compared to finding another £40k towards finding something else, waiting around for them to complete pushed Welshwoof out of the market for the area. And all because they were flexible on completion date. My personal opinion would be to see the Specific Performance through and see what happens, I don't think this couple wants to go court no more than Welshwoof, as I have said before this is a case of who blinks first.

AMD

DVardysShadow

barnaby-bear wrote: »

With the charge on the LR does this mean they can't sell to anyone else regardless of whether you push for SP or do nothing? What happens if you don't push but that note stays on the LR - is it some weird deadlock?

Are back with the UN1 here?

I would think that it has no direct impact on the seller - but it would probably put off a lender and all but the most determined self funded buyer. I would be interested in what Richard Webster, for example, would tell a buying client if the search turned up this one. Of course if it were remarketed and an Agent discovered, somehow, that there was a UN1, with this tale, I would imagine that they might drop the property like a hot potato - because 1 agent obviously would have had trouble getting his fee for the sale. Thinking aloud for a moment, the first agent should not handle the remarketing as there is a contract in place - or if he does, he should be bound to declare the existing contract to viewers and ensure it is in the HIP. Similarly other agents, I would think, would need to be upfront about the status of the property to the extent which they were aware of the UN1 and what was behind it.

Thinking aloud some more, from a 'karma' perspective, Welshwoofs should probably be prepared to let this house go, as in hold the idea of having the house in an open hand and let the wind take it away or leave it but at the same time hold on to the contract and take the legal path which leaves the UN1 in place while actually spending very little on legal action and looking for the next house.

silvercar

Thinking aloud some more, from a 'karma' perspective, Welshwoofs should probably be prepared to let this house go, as in hold the idea of having the house in an open hand and let the wind take it away or leave it but at the same time hold on to the contract and take the legal path which leaves the UN1 in place while actually spending very little on legal action and looking for the next house.

But WW would be caught, once exchanging on a new house he wouldn't be in a position to fund the purchase of this house.

Are the mad (non-) sellers aware of the UN1 and what it means?