New Build Purchase - Two weeks to exchange!

crazyapple

Hi all,

just after a bit of advice

I've just had an offer accepted on a new build that is already finished/built. Got a decent price because of my position (mortgage in principle ready, no chain/first time buyer).

However, the developer has emailed a sales reservation form via the estate agent, asking for a £2500 reservation fee. I'm ok with this, but a condition of the sale is exchange of contracts within 2 weeks of today and completion another 2 weeks afterwards.

Seems very tight - is this kind of timescale normal?

Many thanks

timmyt

its always 28 days, and refuse to pay reservation...buyers market at mo

cjmumto2

Yip newbuilds fly, we were under strict instructions to complete within in 6 weeks and had a house to sell, but we did it, boy did I hound my solicitor. Why do you want it to take longer? Although if it went over 4 weeks I am sure nothing will happen they just like their money in the bank.

G_M

What happens if you miss the Exchange date? By a day? Lose your fee?

Read the small print and get yourself a solicitor (do NOT use one recommended by the vendor).

Yorkie1

Also, what happens if the legals take longer to finish than 28 days? Or your mortgage application takes longer than 14 days to be satisfactorily completed to an offer?

As G_M says, read the small print and get your own solicitor to advise you of the implications of signing this document.

geoffky

G_M wrote: »

What happens if you miss the Exchange date? By a day? Lose your fee?

Read the small print and get yourself a solicitor (do NOT use one recommended by the vendor).

THE above is so important,,THEIR solicitor will not be acting for you..

crazyapple

G_M wrote: »

What happens if you miss the Exchange date? By a day? Lose your fee?

Read the small print and get yourself a solicitor (do NOT use one recommended by the vendor).

Thanks for the quick replies...

The reservation contract states:

!"I have paid a reservation fee of £2500...I fully understand and agree that in the event of me not entering into a binding contract to purchase within 14 days from my solicitor exchanging contracts that [the developer] is permitted to retain this fee."

All things aside, are most conveyancers able to act within this timescale...?

klolav

I would have loved to be able to complete in this time scale, but it's not always as straight forward as that is it?
Maybe New houses are different, as I have never bought one. Surely he can't keep the £2500 if you can't exchange within 14 days, you can't be held accountable for that???
Good luck with your purchase.

Richard_Webster

Tell them there is nice second hand house down the road you can buy for £10K less and you were undecided whether to bother with theirs - you like it but your decision is finely balanced - if they mess you around you'll buy the other one. You give them £1,000 reservation deposit and want 28 days to exchange.

rodders470

We recently exchanged contracts for a new build. When we reserved it the developer asked for exchange within 28 days, but in the end it was nearer 7 weeks for us. The developer didn't mind at all, I think they were desperate to sell and didn't want to risk us pulling out.

wastedtalent

I don;t believe they are allowed to keep reservation fees, part of the NHBC scheme. They have to return it if it falls through, I'm probably wrong but I think I read this in my NHBC documents.

We only paid a £500 reservation fee, which we lose £100 or £200 if we pull out.