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small claims court to get back house reservation fee's??
seriphines
Posts: 10 Forumite
My girlfriend and I planned to purchase a new home on a development in the north-west we were putting my girlfriends house down as a part-exchange, the developer Moris Homes offered 85k based on two EA valuations of 75k-95k funninly enough the lower valuation was from a EA who they use on a regular basis to value PX homes on their behalf.
My girlfriend was desperate to move as she hated the area and has a poor credit history so borrowing was limited to us. We found a mortgage that would work and paid the reservation fees totaling around £1300 including some extras. Morris homes sent out a surveyor who approved their purchase of our property at 85k. Our mortgage company (The Leeds) carried out a survey on the new home to our disgust they valued the new home 30k lower than our purchase price.
Alarm bells started ringing loudly and we discussed our options with morris homes as we had been declined a mortgage in principle once before we got approved we didnt want to take up morris's offer to pay for a new survey from another lender? They at this point promised if we couldnt go ahead we would get our reservation + extra back which reassured us, It shouldnt have.
We later got to know that they had accepted an offer of 90k for my girlfriends home as they had been marketing it from and early stage in the deal. we decided to sell the house ourselves at the higher price giving us a higher deposit and more bargaining power. Morris homes had indicated that they could negotiate the asking price but gave no figures and nothing in writing to us!
They requested that we appeal the valuation of our mortgage company which could take weeks and we had been advised by the financial advisor that it is unusual for a valuer to alter their original valuation. We didnt want to miss a sale so contacted the EA and instructed them to proceed with the sale of my girlfriends house. This took several days and lots of phone calls as the EA had to be formally de-instructed by Morris Homes before they could sell the house on our instruction.
Morris Homes are now refusing to refund the fees we paid (Reservation and extras) as they are saying that we have pulled out of the sale. The contract stated that the fee is refundable as long as the fault is not ours which if course it is not! We cannot proceed due to them overpricing their house. Where do we stand legally in this respect? Any advice would be greatly appreciated
My girlfriend was desperate to move as she hated the area and has a poor credit history so borrowing was limited to us. We found a mortgage that would work and paid the reservation fees totaling around £1300 including some extras. Morris homes sent out a surveyor who approved their purchase of our property at 85k. Our mortgage company (The Leeds) carried out a survey on the new home to our disgust they valued the new home 30k lower than our purchase price.
Alarm bells started ringing loudly and we discussed our options with morris homes as we had been declined a mortgage in principle once before we got approved we didnt want to take up morris's offer to pay for a new survey from another lender? They at this point promised if we couldnt go ahead we would get our reservation + extra back which reassured us, It shouldnt have.
We later got to know that they had accepted an offer of 90k for my girlfriends home as they had been marketing it from and early stage in the deal. we decided to sell the house ourselves at the higher price giving us a higher deposit and more bargaining power. Morris homes had indicated that they could negotiate the asking price but gave no figures and nothing in writing to us!
They requested that we appeal the valuation of our mortgage company which could take weeks and we had been advised by the financial advisor that it is unusual for a valuer to alter their original valuation. We didnt want to miss a sale so contacted the EA and instructed them to proceed with the sale of my girlfriends house. This took several days and lots of phone calls as the EA had to be formally de-instructed by Morris Homes before they could sell the house on our instruction.
Morris Homes are now refusing to refund the fees we paid (Reservation and extras) as they are saying that we have pulled out of the sale. The contract stated that the fee is refundable as long as the fault is not ours which if course it is not! We cannot proceed due to them overpricing their house. Where do we stand legally in this respect? Any advice would be greatly appreciated
0
Comments
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can you break up your post a bit - I've got lost twice trying to read it and haven't got to the end yet...0
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Hello, I have tried to make the post more reader-friendly
Thanks
Dan0 -
Its easier to read now but I'm not sure what to advise. I don't really understand the bit in the middle about getting a mortage in principle approved and getting a surveyor from another lender.
Has the sale of your girlfriends flat gone through now (i.e. have you got the money in the bank)?
Do you still want to buy this new build - but at a more reasonable price? Have you actually pulled out or are you just struggling to get a mortgage lender to lend enough for you to be able to afford it at the agreed price?0 -
As far as I can work out from your post:
GF's house valued by Morris £85k (which I presume you accepted?)
You got a mortgage with reservation fees £1300
Developer approves £85k valuation so the purchase can go ahead
Mortgage valued the new house at £30k lower than asking price
Morris offered to pay reservation fee back if you couldn't go ahead with buying the new house
GF sold house herself £90k despite it being marketted by Morris
Developer won't refund the fees paid because they say you've pulled out.
Is this a correct summary?
As sonastin asked, are you pulling out of buying the new house or are you just trying to negoiate a new price?
If the contract states your GF will sell them her house at £85k as a deposit could it be that Morris is saying that you have pulled out of the agreed sale due the fact that she pulled out of this to sell her house herself in order to have a cash deposit?0
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