new build nightmare

neenandalex

Can anybody help ?

Myself and my partner are going through the process of buying a new build property (first time buyers) the house is being brought on a 75/25 scheme. we own 100% and pay the 25% back after 10 years.

the financial advisor was one of the house builder "recommended advisors" as were our solicitors. we had no choice in that matter as they wouldnt offer us the deal without using there choice of advisors and sols. we went ahead and exhanged contracts back in march on the verbal understanding that the house was going to be built in october. everything was going fine!!!

October came and went... we complained to our solicitors and the house builder becuase we had been told october would be the completion date right from the get go and nothing else. they apologised for the mistake but ultimatley said there was nothing we could do. after a bit of digging around it became apperent that the builder wouldnt agree to a long stop completion date before the contracts were exchanged. we were never told this by our solicitors and as we had never really signed contrcats like this before we didnt know what to look out for when siging them in the first place. it appears that myself and my partner are locked into a completely open ended contract. it seems we have all of the legal obligations to fulfill and the builder can just build the property when they feel like it.

As if this was not enough, stamp duty has gone back up and my employer has now told me that i may lose my job in february (highly likely).

We have emailed our solicitors advising them that we may not be able to go through with financial completion becuase I may not have a job come april,the passed this information onto the builders solicitors and their response was "there is plenty of time to get anoher job" and "may we remind you that you are bound by the terms of the contract regardless of whether you have a job or not"

Needless to say, this has come as a bit of a shock to us... if i have no job come april, how can i get a mortgage?

if i do get a new job, surely you need to of been with the company for over 6 months to secure a mortgage?

we thought that we were being responsible and honest with the builder and that they may look on our dire cirrcumstances in a more favourable light and agree to mutually recind the contract, but they have not.

We need some help people. we feel that we are being bullied into buying a house when through no fault of our own we may not be able to secure the funds to buy the house. can this be right? how can they force us to buy when i cant get a mortgage?

how do we get out of this mess?

neen and alex x (first time we have used this site so sorry for rambling)

Pitlanepiglet

You've signed a standard new build contract, they (with few exceptions) give the purchaser no guarantee of a completion date and give the seller the right to call for completion within 10 days or something similar.

The solicitor may be recommended by the seller but they are acting for you and must advise you accordingly. I find it slightly difficult to believe that they didn't explain to you the mechanics of completion, that would be fairly standard advice. Have you had any meetings with the solicitor - what paperwork have they sent you.

What did you ask the solicitor about completion or did you rely on what the seller's agent told you about completion?

If you believe that you were not advised correctly then you need to complain to the solicitor.s firm. In the initial letter they sent you it should set out who to contact in the event of a complaint. Put your complaint in writing to them, don't get sidetracked by potentially losing your job, presumably that would have been a problem whether you had completed in October or not . Your complaint is that you weren't adequately advised as to the nature of the contract that you were signing.

Are they actually building on the site at all or have they stopped completely?

neenandalex

at the time we were just dead set on getting a house that we overlooked this aspect. in hinsight we too feel that there is a massive conflict of interest here. it seems everyone is conspiring against us and we dont have anyone to turn to for impartial advice.

needless to say we feel stupid now but i think we are going to see a local solicitor and see what they say.

its written in the contract that we will need to pay the builder a deposit if we fail to complete but, but where are there obligations, they failed to complete in october last year!!!! we dont get nothing!!!

thanks for your response lydia! heres hoping we get this sorted. x

neenandalex

Hi piglet

the solicitors sent us all of the paper work and contract through the post in march. We read through it our selves at home and signed where the solicitor had marke an X in pencil. we delivered it back to them by hand the next day.

at this point the solicitor asked me when i get my keys, i said its not complete until october. she seemed confused and said oh right ok.

the ocober completion date was given to us by the house builder... never our solicitors. as we have never done this kind of thing we took what the builder said as gospel and exchnaged contracts on the basis that the house was boing to be built for october.

at no stage did our solicitors explain anything to us about the completion of the build. they simply said they needed our contract back as soon as possible so they could exchange. hence why i dropped it off in person.

ive tried complaining to our solicitors, sighting that they have breached there duty of care by not asking for at least a longstop completion date and allowing us to enter into a contract that we are unable to recind. but they just brushed our compliant aside and said they are looking out for our interests.

we have complained to the builder for giving us the wrong completion date, they admitted to the mistake but pretty much said it was tough!

the build has started but i think its stopped becuase of the bad weather

thanks for your reply piglet

Pitlanepiglet

The solicitor is acting for you, they cannot act for both you and the builder, the Law Society Rules do not permit it and do not allow the solicitor to be biased.

The builders recommend certain solicitors as they are familiar with the development pack and it saves lots of separate solicitors doing the same work over and over again and it saves you money.

Again, if you feel that the solicitor hasn't been solely acting on your behalf then complain to whoever is shown on the client care letter.

The contract is a standard one, the solicitor hasn't done anything wrong as long as they explained the effect of it to you. It's why I would never buy a new build - you don't get any guarantees and if you knew that but chose to overlook it in your enthusiasm at the time then unfortunately you've learnt a tough lesson.

In this market I suspect the builder will go after you hard if you fail to complete. You would usually be at risk for your deposit plus any other losses the builder may suffer and that might include a drop in purchase price.

You can also complain to http://www.legalcomplaints.org.uk/home.page my cousin has been dealing with them and she says they have been lovely and really easy to deal with. It might be worth giving the a ring.

Pitlanepiglet

Sorry I think we cross posted. Give the Legal Complaints people a ring if you've had no success with the law firm.

bitsandpieces

Did the solicitor not warn you of these risks before you exchanged?

pinkshoes

As above, the solicitor SHOULD have warned you when signing that the completion date is not set in stone, and that after exchanging, you're liable to complete. You'll probably have to pay 10% to the builder if you pull out.

What exactly did the contract say that you signed? Did it mention anything about a completion date after the building is finished?

poppysarah

I think the govt needs to take action and stop builders allowing "recommended" solic and mortgage brokers.

Kyrae

Sorry to hear about the trouble you're having I completely agree that the risks aren't explained enough when buying a new build, it's easy to get caught up in all the great stuff the sales staff are saying, about how wonderful the new house will be etc, and they don't tell you the truth behind it all and how much hassle you'll go through! I say that as a person also currently buying a new build, and who has experienced their share of ups and downs! Hang on in there and I hope things work out for you

marcg

Identical situation: http://forums.moneysavingexpert.com/showthread.html?t=1521731

Happy-ish ending (lost deposit but that was it).