Exchanged with a delay in transfer of funds 1 week before completion

nthawkins1971

After exchanging contracts 2 weeks ago we recieved a final financial statement with 2 weeks to go until completion.

The problem we are facing is that we were short an amount of money, however, we have raised this amount but it will possibly take 7 working days to transfer via bacs...

the solicitors need the full amount by the 14th of Jan but the money may not clear in time.. how much trouble are we in if this happens?

people will have removal companies booked etc so we dont want to mess up!

please any advice we would be so so grateful

bitsandpieces

Can you not do a same-day CHAPS transfer? It might cost £20 or so per transfer - but a lot better than having to delay completion!

haras_nosirrah

do the solicitors know where the extra funds are coming from - if coming from another account I believe they have to do identity checks on it. Best thing is to chaps it to your account and then chaps to solicitors to ensure it gets there. Believe the penalties for failure to complete on the right day are more severe than losing £40 in bank fees

nthawkins1971

the letter we recieved says we can do a

1. telegraphic transfer or bacs
2. bank draft
3. debit card
4. credit card
5. personal cheque

all of which mention the money must be transfered 3 or more working days before 14th. Its a lot of money so we have to wait this coming week for the money to be transfered from various accounts to our account.

The solicitors also mention that we can use only one of these payment methods so we have to consolidate all the money into 1 account for payment to them...

would they be flexible on this? as long as they get the money.. no?

thanks.

bitsandpieces

Sounds like you need to speak to your solicitors on Monday (Telegraphic Transfer is sometimes used to mean CHAPS, but I've also heard it used for international transfers of funds). You'll need to ask the solicitor how best to get them the money - the last thing you want is to cause problems with the way you move funds. Don't assume they'll be flexible - and I'd be amazed if they provided funds for you to complete with before your own funds were cleared and processed.

I wouldn't panic, but I would speak to the solicitor ASAP - to make sure things go smoothly. Assuming you can transfer the money from these various accounts into yours (via CHAPS) tomorrow morning, it should be there tomorrow afternoon. If you initiate the transfer to the solicitor tomorrow afternoon (speak to them about this - but I imagine that CHAPS would be best) it will be with them by Tuesday. Even if they need 7 working days to process the funds or whatever, this should leave them time. Speak to the solicitor about what's best, though.

nthawkins1971

whats the worse case scenario if funds do not go through in time? we are so stretched in the short term from raising this extra money that any extra charges could really break us... we have 2 kids and our lifes savings going into this ...is it possible that we receive hefty fines or even being sued!!!

haras_nosirrah

Check with solicitors what the penalties may be when they open tomorrow. Believe TT is the same as chaps so that is an option to get it to them

How short were you - was it through mis calculation on mortgage amount or because solicitors fees were more etc?

nthawkins1971

We were mis-informed by the bank when we applied for the mortgage.

We told them the value of the house we wanted to buy and the amount our house we are selling was worth.

The bank knew how much mortgage we already had and told us that if we port our mortgage across we can add the extra mortgage needed with a new application.

After looking at the numbers I called them back and asked if they were sure this is correct as it seemed wrong to me... the guy i spoke with assured me he was right with his calculation so we went ahead and applied for the new mortgage which was approved. We are also using a good amount below what we are allowed, I was really happy about this.

It turns out that the calculation was wrong and he didnt allocate for the morgage we already had on the property we were selling so we are short 65k.. I'm using my business money, savings, credit card and a loan to make up the amount. The Bank have agreed to mortgage the extra, so i can pay this money back shortly... however as it is a lot they will have to do another application and this will never get through in time.

absolute nightmare and soooo much money!

bitsandpieces

The short answer is, you want to make sure you've got the funds in place to complete on time. Speak to the solicitor ASAP as to the best way to do this. From what you say, you've got 10 calendar days to get the money transfers sorted - don't see why it shouldn't be doable. When you say money's tight - it's not so tight that you can't afford transfer fees?

Did the solicitor not warn you about the risks of exchanging contracts without a solid mortgage offer in place? When you exchange, you commit to completing on a certain date. If you fail to do so, you do run the risk of being sued for costs incurred by the people you're buying from/selling to. Hopefully it won't come to that, though.

zzzLazyDaisy

If you fail to complete on time you will be in breach of contract and hit with compensation claims not only from your immediate seller/buyer, but also claims from others further up in the chain will ultimately be passed down to you, as the consequential losses of your buyer/seller.

You can do a same day telegraphic transfer - there is a fee but it will be loads cheaper than facing claims if you fail to complete on time. Don't under-estimate how serious this is.

nthawkins1971

thanks for advise