FTB - Problems with Completion Date

supercarrie

I don't post here much but am a long time lurker. My husband and I (FTBs) are in the process of buying a house in the South East. This property is in a chain (only two properties long).

The situation is that our sellers had an offer accepted on a maisonette shortly after our offer on their house was accepted - this all happened in mid-July. The lady who owns the maisonette verbally agreed at the time she would move into her daughter's home to allow the sales to complete in a timely manner.

After 3 months and many delays in our seller's purchase (it is a leasehold property and they had queries which took quite awhile to resolve), we were informed by our seller's solicitors early last week that they were "close" to being ready to exchange. Note: we have been ready since mid-August! Then, out of the blue last Thursday, the lady who owns the maisonette our sellers are buying sent a fax to all parties stating she doesn't want to move before Christmas (realistically I assume this means in the New Year), with no reason provided.

Our main problem is this: our mortgage offer expires on 13 Nov. RBS have said they will likely be unable to guarantee the fixed rate offer past then. We don't want to extend the offer with their increased fixed rate, or go through the expensive process of applying for a new mortgage through another lender.

We've asked our sellers if they would be willing to move into rented accomodation to allow the sale to go through. We really do not want to pull out but really see no choice, if we can't complete before the 13th!

This is more of a vent than anything, but I wondered if anyone has been in a similar situation before, or had any advice for us?

JayZed

I think you just have to be blunt. Get your solicitors to write to the vendors stating that you require a completion date no later than 13 November otherwise you will pull out of the deal. You might want to set a time limit on exchange as well (e.g. exchange no later than 30 October, two weeks before your completion deadilne).

The issues that they are having with their vendor are their problem, not yours, and you shouldn't get sucked into discussions about that.

1echidna

You need to explain that you have to complete by 13th November or withdraw and the reason why and make sure the lady saying she doesn't want to move before Christmas gets the message and doesn't think (as is often the case) that you are bluffing. Depending on her position she may or may not wish to break up the chain and possibly have to resell her property.

sarah_elton

On the other hand, if you pull out you won't be able to find and complete on another property before the 13th November, so you lose that mortgage rate either way. If the house is the one you want, I don't see the benefit to you in pulling out. Unless you simply can't afford higher mortgage repayments.

goldbyron

I agree with above - there is no point pulling out as you would lose the rate anyway. However I would seek to agree an exchange date as soon as to allow you to plan and relax that despite the long time to completion, you have exchanged.

supercarrie

Thanks for the opinions. We can afford the higher payments but of course don't want to pay them if at all possible! Makes a difference of around £80/month - it is a 5 year fixed rate so £4800 over the 5 years.

If we were to agree to wait, we would definitely insist on exchanging now with a fixed completion date in the New Year. I don't trust waiting until the New Year to exchange, considering we have been misled once on the woman's intentions! (Or she is just unreliable and prone to changing her mind!)

Also - we could of course pull out, find a different house, and apply for a new mortgage via a different lender (who is offering the same rate we currently hold). It is just that RBS have increased their rates; other banks still have the same rate we currently have an offer at.

Hailstorm

There is another way you can prevent your mortgage repayments going up if completion is after the 13th November.

State that a completion date after the 13th November will cost you more money due to your mortgage offer expiring and if completion is to be after this date you will be reducing your offer to compensate.

supercarrie

My husband proposed another solution, but I am not sure of any potential implications to this. What if we were to exchange and complete before the 13th, with an agreement to let the property back to them until they complete on the other property. We would charge them for the rent we are currently paying in our short let to cover that cost. (This is less than the cost of what the mortgage payment would be.)

I assume this may require permission from our lender? Any thoughts/comments?

DVardysShadow

supercarrie wrote: »

My husband proposed another solution, but I am not sure of any potential implications to this. What if we were to exchange and complete before the 13th, with an agreement to let the property back to them until they complete on the other property. We would charge them for the rent we are currently paying in our short let to cover that cost. (This is less than the cost of what the mortgage payment would be.)

I assume this may require permission from our lender? Any thoughts/comments?

For this to work, your vendors require an exchanged contract on the property they are buying for a date after Christmas, otherwise, they could be out on their ear, or you could have overstaying tenants. Plus you would need lenders permission.

The route I would go down is communicating to the lady with the maisonette via the Agents - note that the message was sent via solicitors - the Agents may have a different take on this. I don't think I would be minded to accommodate this woman's Christmas at the expense of the mortgage deal - you and your vendor need to combine forces to get her Agent to manage his client.

chappers

I would threaten to pull out of the deal if she doesn't complete and ask her, why she can't complete before christmas( she may have a valid reason, but if not this may embarass her into changing her mind)

supercarrie

We've found out a bit more about the lady at the end of the chain. She is an elderly woman and essentially, it is her daughter who is holding the process up. The daughter had said initially that her mum could move in with her to allow the sale to go through, but is now claiming she never stated that. The reason she does not want to complete until January is that apparently the house they are buying for her mum (which is not part of the chain - her daughter is buying this for her) needs some work done to it and she is claiming this will take 3 months to do. Our EA received the details of this work and said that in his opinion, there is no way it should take 3 months and she is really just being difficult for no reason.

Our sellers are quite unhappy with this news, as well. One of our sellers is an older woman who has some bad health problems and can no longer climb stairs, etc, so they were hoping for a fast completion so they could move into the maisonette they are buying. We have asked them if they can move into rented or move in with family, etc and they are thus far refusing to do so. Apparently they are thinking of pulling out of the purchase of the maisonette altogether, and actually went to view an empty property this morning.

We are waiting to hear from them on what they are planning on doing - we have indicated that if we don't exchange before the 30th, we will pull out as we need to sort long-term accomodation out. We were also informed yesterday that the short let flat we have moved into with the premise of it being available for several months, is not available after the 8th Nov.

If we don't exchange before the 30th, I think we'll cut our losses and move into a rented house in the area for a year, picking up our housing search in 6-8 months time.