Urgent Exchange of Contract Advice Please

Discharged

SORRY THIS IS A LONG ONE!!!

Firstly, as my username, I'm a discharged bankrupt, but only been discharged 21 months so won't qualify for mortgage even with my partner who is 100% 'clear', so the house 'we've bought' is in her name solely.

In August 09 we decided to look at buying a bigger house, we live in a great part of Wigan borough and don't want to move too far from where my partner has owned her home since 1996.

Persimmon homes had 're-started' a development around the corner and we ended up (after doing the sums) putting a reservation down on a new 4 bed detached house. I used to be an agent and reckoned we could sell our immaculate 2 bed starter quickly and put a reservation down (£500) on the new house.

It's 4 bed detached, on large corner plot (which was £5K extra btw), only one house on one side and spacious path on other leading to farm fields behind our house. We were told it would be ready by March 2010, great, gives us time to save up some more cash.

We feel we got a great deal, £12K off list, plus full fencing, landscaping, alarm, premium carpets. They'd release 4 houses at a time and they'd be reserved within a couple of weeks and we knew the next houses would go up £10K, so we reserved to secure the price. These were being sold for £290K 12 months previously.

We were told we would have to exchange within 28 days of the reservation but by the time we got the HIP pack done etc this passed, but we were upfront with them and they gave us some space and I sold our house after about 8 weeks.

We got a brilliant buyer, she's a teacher who wants to secure a property and was willing to wait as late as summer 2010 to move in, like us, giving her plenty of time to save up extra cash.

In November we're more or less ready to exchange and the plot pointed out to be ours had the foundations installed. When this happened we queried the size of our plot, as it looked drastically smaller than quoted from the deeds and landscaping plan, which were measured to scale.

My partner rushed to site to see the site manager, whilst there she was told there was another house going to the side where the path was, which didn't sound correct and the garage was on the wrong side. More annoyingly, her brand new £30K car was damaged and nobody would own up to it, I emailed a picture and complaint to the HQ and STILL have not had a reply, only a read receipt.

At this point it was identified that our plot was actually under the building compound and the plot we thought was ours was actually our next door neighbour, the sales lady had put the number boards up on the wrong plots. To clarify, the building compound/offices etc are in the middle of a street, our plot is under the compound, BUT the only plot out of three under the compound released for sale, which I find odd.

We were then told it would more than likely be April when it would be ready as they have to move the compound in the new year, but with a 20 week build for our house, this was really pushing it for April and more importantly my partners mortgage offer runs out end of May.

I raised this with the contracts manager on site who asked us to get our solicitor to request a guaranteed build date which was possible. We did this and they've since come back and said they're 'happy' to give a 'long stay' date of August 31st:(

We've asked for a conditional contract letting us walk away if we can't get a new mortgage offer after May and they've refused. The current weather is not helping and today after I called head office to complain about the regional sales manager they informed me that the August date is worst case but we can have another plot which is in progress for the same price, shame it has a tiny garden and the people who originally reserved have allegedly dropped out as they're drive isn't long enough for a car! So hardly apples for apples with our end plot with large front, rear and side gardens.

They have given us a week to exchange, so we now are expected to exchange knowing if we can't get another mortgage offer in June we would be liable for 10% of the value.

Our solicitor has obviously advised against this but we've this weekend viewed six houses all similar size, they're all circa £230K and even though we're the only people that have viewed them who are actually in a position to move, they all want their asking prices as the prices have fallen with the market.

Questions are:

Our buyer is willing to complete with us in May and rent to us until ours is ready, Persimmon have given a worst case date of August, if they pass this can we sue for our losses?

When we complete with our buyer, can we instruct the solicitor to return monies back to us? We don't want her giving anything to Persimmon until we a) get another offer and b) are ready to move

If we back out, could we sue Persimmons for our £500 res fee, plus £495 valuation fee and solicitors fee's? I've been told they've broke a verbal contract and have been unreasonable to say the least. I'd have a go for the cost of filing it with small claims court.

Thanks in advance, sorry for spelling/bad grammar, i'm furious1!

silvercar

Discharged wrote:

Our solicitor has obviously advised against this

Says it all really.

bitsandpieces

Your solicitor is advising against exchanging if you may not be able to complete because you could lose a shed load of money by doing so (I think you can be sued for more than the 10% deposit in some cases - though not sure). What happens if e.g. the build isn't complete until August 30th and your partner can't get a mortgage (these things happen - circumstances can change, as can lending criteria...also, the valuation on the property could be considerably less than the price you're agreeing now).

It's also worth noting that there's a degree of trust involved in buying and selling houses. Sounds like you've been messed around a bit. Do you trust Persimmon enough to proceed, esp on what seems like quite a risky basis?

Discharged wrote: »

Our buyer is willing to complete with us in May and rent to us until ours is ready

Have they spoke to their solicitor about this? It's possible that the buyer may be advised against this.

It's ultimately a decision for you and your partner - you might decide to go ahead and risk it (though the financial risk will ultimately lie with your partner, I think). Make sure you're aware of what the risks are, though, as well as the advantages.

PasturesNew

Your buyer might not be allowed to rent the house to you, having bought it.... if they've got a residential mortgage then it'd be 'fraud' knowing they were letting it out.

Why not just sell your house to your buyer, move into rented and then you're not held over a barrel by anybody, but are completely free/able to make decisions.

G_M

Walk away from this bad deal!

Emmzi

nothing you have written gives me any confidence in your builder. I do like your solicitor tho.

Sell to the nice lady. Storage is quite cheap, and rent somwhere for a bit.

While you look for a house from someone who does not mislead you, and that is ready to move in to.

A loss of £1k in fees is a very cheap lesson compared to exchanging...

Discharged

PasturesNew wrote: »

Your buyer might not be allowed to rent the house to you, having bought it.... if they've got a residential mortgage then it'd be 'fraud' knowing they were letting it out.

Why not just sell your house to your buyer, move into rented and then you're not held over a barrel by anybody, but are completely free/able to make decisions.

Yes the buyers solicitor has advised against renting to us, they always do, they hear the horror stories and even though we've lovingly owned the home for 14 years we're tarred with the 'won't move out and destroy the house before we leave' brush.

Sure her mortgage is not a B2L mortgage etc but for a couple of months most people aren't bothered and the lender won't know as long as she's paying her mortgage. When I was an agent I snapped lots of properties lie ours for investors and every time solicitors advised against this and as long as the landlord was happy to release the tenant from contract then there's no issue. We certainly don't intend on giving it to her in any other condition than we keep it anyway, tip top.

We don't want to move into rented as we should be in the house in late June, it's the legal dept who are saying August, no doubt there's been a month added by them from whatever date the site manager has given them

As per this weekends exercise of looking at comparable houses, if we lost the deal we probably won't be able to afford to buy the same house as they're all circa £230K and that's outside our reach due to my partner being able to lend £215K max

I believe the long stay date of August is legal binding so if they exceed it they're liable for our costs.

It's weighing up the risks of it going wrong versus the risks of backing out and not being able to get into a comparable property at all.

Dazsharps

Hi mate,

just thought i would see how you are getting on with this?

I have purchased a plot on the very estate you are speaking about and so i know what you are going through.

Been a long road for us but things are looking good for our move in next 2 months

Be nice to hear from a potential future neighbour.

Regards

Daz