House-Buying Quandry

SGee

My friend is in a bit of a pickle with house-buying and I wondered if anyone could advise.

She signed missives last year for an off-plan flat that was supposed to be ready months ago, but the builders did not complete it when they said they would, and her mortgage in principle has now fallen through. She can't get the same deal again, and in fact can't get anything affordable - all lenders want approx 30% deposit. So even when the flat is finished, she won't be able to afford to move in. She wants out, but it seems that she's tied to a contract.

Is there any way she can get out of this, e.g. by buying herself out of the contract? The builders don't seem to have broken their side of the deal as they didn't set a date for completing the development, but it's their delay that has caused these problems in the first place and I'm convinced there must be some way of meeting them in the middle/getting them to take some responsibility!

Any advice would be most appreciated - thanks.

Cannon_Fodder

Unfortunately, there has been a spate of these situations. Developers are playing hard-ball so far.

http://www.telegraph.co.uk/finance/personalfinance/investing/6154187/Buy-to-let-investors-backing-out-of-off-plan-deals-face-court-action.html


Maybe consult her solicitor to check the small print for a long-stop date.

Ask her solicitor why she was not warned of the implications of a missing long-stop date.

She should have thought of it herself, but it doesn't hurt to make the solicitor squirm a bit.

If the build still isn't finished, do everything she can to delay completion. i.e. if she gets to choose designs for the kitchen, flooring options or anything else, take her time over the selection/notification to the developer.

And meantime save, save, save, to increase her deposit. Mortgage deals may change in her favour over time.

Maybe contact Shelter for advice beyond;
http://scotland.shelter.org.uk/getadvice/advice_topics/finding_a_place_to_live/buying_a_home/new_build_homes


Maybe consider negotiating with the developer. Probably best to seek legal advice before exposing her vulnerability.

property.advert

I was warned about this back in the 90s and we were around 6 months late on a new build but prices went up so much that they'd have given a dead dog a mortgage on it in the end. I did sweat though as I was on a contract at the time. Baffling then with bull was so much easier then.

I would go back to the lender. Perhaps she could shame them into agreeing the original or near original terms. Save as well, hell, borrow off family if she has to and can. We are not talking millions here are we ?

SGee

Thanks for the advice - will pass this on. Sounds like there may be things that she can do to at least mitigate the harm if not avoid it completely.

Thanks again.