Buying a repossession - 7 day notice period!

Daledavis17

Hi all,

I am going through the purchase of a repossession in London. About 5 weeks ago we offered £195,000 for a 2 bed flat above commercial property. The property was a conversion with a second bedroom added in the loft. About 10 days ago we had the survey completed and it became apparent that whilst planning permission was sought for the conversion the works were never signed off by building control and no competition certificate issued.

I called the council and spoke with the actual building inspector who conducted the inspection. He informed me that per his notes all was in order except for the access onto the rood terrace. (it required a Juliette balcony to stop people falling over).

Upon hearing there was no completion statement, and after speaking with the council on what is needed to secure a certificate we informed the vendors and dropped our offer to £192,500 to reflect additional costs.

The original exchange date after acceptance of our original offer of £195,000 was today (5 May 2010). Just yesterday they agreed to take £192,500. All good we thought as we could still exchange today and complete within the next seven days.

However the estate agent has now thrown a spanner in the works and stated that because we have dropped the offer by £2,500 the price now needs to be re advertised in the paper for 7 days again. He stated that this is the LAW!!

Does anyone know if it is actually the law, or is it up to the vendor (in this case a bank). Surely if they agreed the £192,500 and originally the £195,000 can we still exchange today (or tomorrow). Does the bank have the power to waive this 7 day period? The original offer of £195,000 was advertised for 7 days with no offers, and is still on the agents website now inviting more offers. (its actually been there for 5 weeks).

Just wondering if anyone knows if we can get out of this 7 day period to wait (again) and whether it is really the law as the estate agent is telling us!!

Thanks everyone - hope it all makes sense.

DVardysShadow

As I understand it, it is not so much the Law as a means of demonstrating that legal obligations have been met.

If the lender does not recover the full amount of the original loan, the repo'd owner will be chased fro the difference. And any surplus after expenses for repo and sale are taken must go to the repo'd owner. So your bargain repo is at the risk and expense of the repo'd owner. The bank has a duty to get the best price to protect the repo'd owner's interests. It has been decided to go back to the market for 7 days to fulfil that duty.

techmob

i know this is an old post but i found it when searching

i keep reading about this 7 day notice period. Is this still applicable as we have had an offer accepted on a repossesion house which is over a week old and the notice of offer is still tagged on right move still accepting offers.

Do they keep accepting offers regardless of this 7 day notice period up to the point of exchange of contracts? if so then what does this 7 day notice mean

thanks

G_M

They may or may not put a notice in the paper, but thet WILL consider any offers up until Exchange.

With a repo, acceptance of your offer simply means you can do the legals/financial etc, but you need to get to Exchange asap as there are no guarantees.