Exchanged but can't complete - serious mess

FTB_Newbie

We've exchanged contracts and are due to complete tomorrow. There is a notice on the property, placed by the person we are buying from ex partner. We've just heard that the ex isn't going to remove the notice, he wants £35,000. It would have to go to court to get the notice removed.

Our solicitor failed to find the notice until after exchange, the person we are buying from has just pointed out the clause in the HIP. The exchange was very rushed, due to pressure from the person we are buying from.

The person we are buying from has now told us that if we can't complete tomorrow, we will lose the deposit, plus forfeit 10% of the sale, so around £40,000. We are unable to buy as the property has a notice.

Don't know where we stand, as we've signed a contract. The solicitors who we are buying from did know of the notice. But the property cannot be legally purchased, as the land registry can not transfer ownership.

Help!

pimento

I think the person you're buying from is wrong. If they own the property and the ex has an interest in it, that's their problem not yours. If the vendor's bank had an interest in the property, they couldn't sell it to you, so there's no difference really if it's the vendor's ex. Is his name also on the mortgage?

Mind you, your solicitor has been a bit remiss in all this. What does s/he have to say?

Thrugelmir

Sounds very interesting. All this is being communicated through the sellers and the not the solicitors handling the transaction?

Comyface

Oh dear, that is a bit of a mess.

Your sols shouldn't have let you exchange IMO and so therefore they should be liable to cover your losses.

I'm not an expert, though, just my tuppence.
Hope it all works out okay.

Vomityspice

If the facts are correct (as I understand them), then it may be your solicitor is in very deep trouble.....

Before you exchanged contracts I take it they did a search and nothing was revealed? and now that you have almost completed he has done the final search and discovered the notice? When did the notice get lodged with the Land Registry? Was the ex obviously in occupation on your inspection? Does your contact (No's 4) say the property is sold with vacant possession?

Rereading your post, was the notice on the register BEFORE you exchanged contracts?

Clause in the HIP? Is that binding? Or rather is the contract you both signed the definitive document (Ps. It's the contract!). What does the HIP say?

Have you actually spoken with the solicitor yet? You need to see what they are saying.

FTB_Newbie

The ex isn't on the mortgage and never has been. Apparently a previous court case was rejected and he is not entitled to any share. Why is someone that lived at a property but was never on the mortgage allowed to put in an application for a notice?

Hippychick

Your solicitor should have spotted this and received an undertaking from your vendors solicitor that the notice would be removed on completion.

As it stands you can complete by paying the correct amount as agreed in the contract tomorrow, it would then be the vendor in breach of contract as they will be unable to complete because they cannot remove the notice.

I would be having a very serious conversation with a senior partner at your solicitors office tomorrow if I were you, they need to sort it out and pronto.

Vomityspice

What does the notice actually say?

caeler

Hi - Do you know if this notice is for Matrimonial Home Rights? This is where the spouse who isn't on the deeds or mortgage registers their interest in the property because its their former matrimonial home, it prevents selling, transferring ownership and remortgaging. Usually this is lifted when a financial settlement is agreed, so I assume this is what hasn't happened yet.

FTB_Newbie

The solicitors work on information from the HIP, which is not a legally binding document and out of date? Our solicitors are saying the notice was not on the documents that they received but there is a line on the HIP with reference to applications on the title. A priority search would have found this problem earlier?

I've left messages with the solicitor but they are not working until tomorrow am. Our broker has phoned our solicitors mobile and left messages also. The buyers solicitors are advising the buyers that if we don't complete they are entitled to the deposit and 10% of the purchase price. Surely they knew we would be unable to complete on a property that had a notice.

The seller's ex has advised in the eleventh hour that he won't remove the notice.

I'm not going to sleep much tonight.

Thrugelmir

bluefuzzybug wrote: »

Hi - Do you know if this notice is for Matrimonial Home Rights? This is where the spouse who isn't on the deeds or mortgage registers their interest in the property because its their former matrimonial home, it prevents selling, transferring ownership and remortgaging. Usually this is lifted when a financial settlement is agreed, so I assume this is what hasn't happened yet.

I thought it interesting that the seller is quoting £40k for losses when his ex is claiming £35k. Too co-incidental.