Suspicious selling conditions, advice needed please

Gizmo777

I'm really hoping someone can advise me of what is going on with our house purchase, I will apologies now for the extra long post.

We are FT B's, mortgage agreed, deposit paid and with the solicitor since the Th February, completion money paid since Monday Th March. From our end we are all set to go. Oh and we are currently in rented, gave our 1 months notice in accordance with when the lease expired on Th march (today!) out of courtesy for what has been an excellent LL to us.

Offer was accepted by the sellers on Th January, property is vacant as the sellers moved out last year (up-sized!) before selling this property, the property we are buying has been on market since April 2010. The sellers are elderly (mid- 70's). Property has been under offer between sept - December when it fell through supposedly the other buyer in the chain fell through.

All was going well, searches done and completed, valuation done and agreed by the mortgage company. Exchange date agreed for Monday Th February with a view to complete on Thursday Th March.

Th Feb arrives, we cannot exchange because there is a document missing on the sellers side. Fine, left it two days, chased my solicitor.

My solicitor cannot get hold of the sellers solicitor, my OH finally got hold of him and he said the document was still outstanding. When asked what document, he replied "the business mortgage document for the second charge on the property". This is the first thing we knew about any mortgage on the property - baring in mind their age. Was assured said document would be in the post for the next day and this was not a big deal and could be sorted.

Last Monday, document still not arrived, chasing estate agent, seller, both solicitors etc etc all day every day, we got to Wednesday and canceled the removal men, changed to today. Got to Friday document still not arrived, canceled removal men again. Made last minute arrangements to extend our rented property for 1 week. Was assured said document was being sent by secure internal post system used by banks and solicitors and would arrive today. Today comes - no document, sellers solicitor is no where to be found (out of office, funny, he didn't mention this on Friday) and secretary said no email copy seen and document not seen in the post. Found out document is actually a "Guarantee" document that will need independent legal advice so the seller will need to get a different solicitor involved to get it signed off.

Spoke to the estate agent who is just as confused as we are. He says they still want to sell to us. I feel like we are being messed around.

We have already spent £1600.00 on solicitors fees and mortgage arrangement fee so we cannot afford to walk away, nor do we want to this is the house for us.

Can anyone shed any light on what the seller might be playing at? Could they have an ulterior motive to drag this out? How complicated is a second charge on a property and how long could it take?

I'm so annoyed, we are living half in boxes, taking time off work to move then canceling last minute and they just don't care.

Estate agent suggested we ask our solicitor to draw up a legal temporary rental agreement to get us in and worry about exchange and completion at a later date, would anyone recommend or advise against this. We really don't know what to do. We are homeless as of Saturday and don't have any parents nearby to live with.

Any help/advice gratefully received, has anyone been through anything similar?

Stressed out :mad:

Flashmanchop

I am sorry to hear your siuation, one of the many issues that crop up in purchasing a property.

I cant really advise on the second charge, but it seems that it is getting sorted - through another soliciotor.

Why... does your soliciotr have all your funds, including the mortgage money ????

"deposit paid and with the solicitor since the Th February, completion money paid since Monday Th March. "

Gizmo777

Thanks for your prompt reply, my solicitor was told by the sellers solicitor that everything was good to go ahead - everyone was working to 28th Feb for exchange and 10th March to complete. My solicitor asked for the funds in order to proceed smoothly for exchange and completion. Being a FTB we thought this was par for the course and normal to reach the end. Our solicitor even requested the mortgage money from our bank and had the whole £225K sitting in her account waiting to change hands. She sent the funds back on Friday afternoon as she couldn't hold onto them any longer.

Moglet

Gizmo777 wrote: »

Our solicitor even requested the mortgage money from our bank and had the whole £225K sitting in her account waiting to change hands. She sent the funds back on Friday afternoon as she couldn't hold onto them any longer.

Good because you'll be charged interest on that money as soon as your solictor draws it down.

Hope you get this resolved soon.

puddleduck

We had a buyer who didn't tell us of a second charge on her property until 6 weeks into proceedings, when she informed us that she wouldn't be able to proceed with buying our house because she was going to have to sort the second charge out first. That was in October. She completed on the sale of her property at the beginning of this month (and moved into rented). Her buyers were moving from rented, so there was only the one transaction.
Based on that experience, I think you might be stuck a lot longer than a week unfortunately. Get your solicitor to get some decent answers out of their solicitor asap.

Richard_Webster

Difficult to know but here's a guess as to what may have happened.

Seller is presumably buying another property. Has second charge on present property to bank to secure or guarantee some business lending to one of the two joint sellers or to a company owned by one of them?

Sellers don't tell their solicitor that the second charge will have to be transferred to the new property - they just assume this is the case and solicitor reasonably assumes that it will be paid off on completion. So he gets the approximate settlement figures for the first and second charges and when he tells his clients roughly how much they will need they tell him it can't be as much as that...."You've included the business overdraft with the bank, we're not paying that off....."

Solicitor tells them it has got to be paid off. Husband says he needs the facility. H goes to bank and they go through their securities department and there are delays whilst the paperwork is sent out to get a second charge on new property. They will also have to get consent from first lender. Have sellers' solicitors been round that loop?

If wife not part of business a House of Lords case of Royal Bank of Scotland v Ettridge says that an independent solicitor has to advise the wife not just on the basic point that if H's business goes down pan she could lose house, but on how well the business is doing and its overall prospects, something most solicitors would not be prepared to do, so
it is not just a case of wandering in a local solicitor and having a 5 minute interview. If someone wanted me to give that advice then I would say that I was not prepared to get involved, just far too much professional risk. If the Ettridge case is involved then they will have difficulty finding a solicitor prepared to do it, and it could cost around £1,000!

I hope I am wrong, but I just wonder whether anyone realises what could be involved here!

Be interesting to hear how this all pans out.

Gizmo777

Thanks again for the replies.

I had a feeling it would be something a lot more complicated than either the estate agent or the sellers solicitor was making out.

One point I did forgret to mention - the sellers solicitor asked my solicitor to look at it as the "independent" legal advice, my solicitor said No she was not prepared to do that, I thought at the time (last Friday) this was due to an already heavy workload. After reading Richards reply I am now thinking Richard has hit the nail on the head as this would explain the refusal.

I will post any updates, however I am now thinking that unless we get some decent answers by the end of this week we may have to walk away. What a waste of time, sellers should have penalties for not disclosing these things before the exchange process to save time and money wasters

Gizmo777

Update 1:

Spoken to our solicitor who has already spoken to the sellers solicitor this morning, he has had the terms and conditions through that he was waiting for. He is still outstanding the guarantee doc's which is actually believes are in this mornings post (11am). He has made the sellers an appointment with another solicitor so all they are waiting for is the papers to turn up and off they go to get them signed.

OH is optimistic, I am waiting for the 4pm phone call to say papers didn't arrive and no more updates. Guess it's back to the waiting game again. Fingers crossed.