Buying a new house with an architect's certificate problem!!! Please Help!!!

djdave748

Hi,
Me and my girlfriend are in a bit of a pickle, we are in the middle of buying a new build house. Things have been progressing slowly due to the fact that the current developers failed to fill out my solicitor’s house information sheet out correctly and missed out key questions and detail. This dragged out the whole process for a couple of weeks which slowed things, as it turned out they have an Architects Certificate for the house which HSBC will not accept as a valid warranty on the house.

We went back to developers and asked told them that to sell the house to us they need to provide us with alternative warranty. They came back with we had to change mortgage provider to one that will accept an Architects Certificate, after researching what one of these were we said NO WAY. Apart from that fact we would have to pay set up fees again for another mortgage we may not get as good a deal on the rate from HSBC and in the long run we could end up paying out a lot more and in the end we would still have an Architects Certificate. They seem to understand this and have said that they will get an LACB which our lender will accept which is fine but now they want us to pay some kind of deposit that we only get back if we buy the house and don’t drop out because they are buying the LACB.

I am a little annoyed at this as when we first went to see the house the developer was raving about how good the warranty was on the house and told us a story about one of his other house that had a tile fall off the roof and they fixed it for them free of charge as they claimed on the Architects Certificate. I know now that an Architects Certificate would not even come close to this level of cover so it was complete bull. At the moment I have told them that we don’t want to get into any sort of contract or put down any sort of deposit because it will cost more in legal fees to setup, make the entire sale even longer than it already will be and quite frankly we don’t see why we should as it’s not our problem that they don’t have adequate warranty on the house.

We really do want to buy the house and have quite stupidly already ordered furniture for the house and bought lots of stuff ready to move in, school boy mistake I know now but it’s done. I do understand why they want to setup this deposit contract because the LABC is 2500 pounds but instead I offered to give them copies of the receipts we have for the furniture with their address on it to show that we are serious about buying the house and won’t drop out as long as they get the LABC.

We are now waiting for a reply to this, we are first time buyers but surly it shouldn’t be this difficult to buy a house if you have the money and mortgage there ready to go. Are we been too soft on the developers? What should we do? We don’t want to go back to house hunting we really want this house but all this hassle buying it is driving us insane. :eek:

djdave748

Does no one have any advice?

Thundercat_2

I'm afraid I haven't been in the same situation as you, so I can only tell you what I think about the scenario you've given.

I think I would be extremely wary of handing over any deposit and tying myself into a sale. What happens if they can't get the LACB (whatever that is!)? Where would you stand then?

It was a silly mistake to start and buy furniture for a house that you don't even own yet - you haven't exchanged contracts or anything and it could fall through at any minute. Can you not cancel the furniture you've ordered or put the order on hold until things have been settled?

How do they intend to sell to any future buyers with just an Architects Certificate? You could argue that other buyers will have the same issue and therefore they will have to buy the LACB no matter what and you're not prepared to be the one taking the financial risk.

Hope this helps - I must admit if it were me, I'd be walking away now regardless of the furniture etc - if they haven't even got a proper warranty then how do you know that if things start to go wrong you'll be covered? Sounds too dodgy for my liking, but if you really want the house that much then you might just have to bite the bullet and accept the risk you're taking.

Thrugelmir

Without an LABC warranty (or something similar) then the developer will struggle to sell the property.

Personally I would threaten to walk away. As this is something which have been considered at the outset by the developer.

Richard_Webster

Without an LABC warranty (or something similar) then the developer will struggle to sell the property.

Personally I would threaten to walk away. As this is something which have been considered at the outset by the developer.

I agree with this.

djdave748

Thanks for the advice, ye I know it was a bit stupid getting furniture when we did but it's all been put on hold for now for as long as we want. I guess that's a lesson learnt when buying a new house, wont be doing that again. I have tried to argue the case that if we pull out it could be a long time untill they find another buyer and by then house prices may have droped so they will lose out that way and even then like you said they still may have to get an LACB or NHBC or equilant warrantey to sell the house to someone else. I think they were hoping that we would have got a mortage with a lender who would accept a Architects Certificate and that way we would have never have been any the wiser.

I also think the reason why they have this Architects Certificate is it seams to be somethings that all small developers have to save money on the build as it's a lot cheaper than an actual warranty.

Trollfever

I also think the reason why they have this Architects Certificate is it seams to be somethings that all small developers have to save money on the build as it's a lot cheaper than an actual warranty.

If the developer is unable to afford to supply a NHBC certificate, wait till they go bust and you should be able to buy the property for less.

djdave748

Trollfever wrote: »

If the developer is unable to afford to supply a NHBC certificate, wait till they go bust and you should be able to buy the property for less.

That's probably not going to happen any time soon, they have an identical property next door that they are renting to their Son and they are currentlly living in the porperty I'm trying to buy as they coulden't sell it and to save them renting while they build a house for them selves, it's a very small developer, like one man and his wife who just buy a bit of land, build as many houses as thet can on it, sell them then do it again.

Also I dont think he is just a developer I think he has a full time job too in the building industry.

FireWyrm

djdave748 wrote: »

That's probably not going to happen any time soon, they have an identical property next door that they are renting to their Son and they are currentlly living in the porperty I'm trying to buy as they coulden't sell it and to save them renting

Really?! Why are you doing HIM the favour with YOUR money?

djdave748 wrote: »

while they build a house for them selves, it's a very small developer, like one man and his wife

Ding Ding! Can you hear that? It's alarm bells....

djdave748 wrote: »

who just buy a bit of land, build as many houses as thet can on it, sell them then do it again.

Oh my! Walk away now. If they cant provide the apropriate certification accepted by your mortgage company, then they are (at best) small time and (at worst) shysters. Either way, they're hardly likely to be able to honour any sort of guarantee and frankly, I'd be suspicious that any guarantee they DO provide is worth the paper it's printed on.

Tell them that if they want to entice you as a buyer, they will provide the correct paperwork sufficient to satisfy your mortgage company. This should be non-negotiable.

With regard to your furniture...put it on hold, store it, etc. The others are right, even with everything rolling your way, it could yet fall through and leave you holding the bag anyway.

djdave748 wrote: »

Also I dont think he is just a developer I think he has a full time job too in the building industry.

Oh no! So, he's not even a real developer backed by an office, a bank account and registered address even...do you know this fella from Bob The Builder? What sort of research have you done on that man you're intending to do business with? Do you know where he lives, what and how this so-called guarantee would be honoured? What is the phonenumber of the insurance company backing this guarantee of his?

Trollfever

as they coulden't sell it

Without the benefit of a NHBC certificate [STRIKE]walk[/STRIKE] run away.

mc33033

Trollfever wrote: »

Without the benefit of a NHBC certificate [STRIKE]walk[/STRIKE] run away.

I think people are getting a little carried away here. We are talking about an building which a qualified architect has willingly signed off having inspected it throughout the build. They are taking a lot more risk then NHBC, and do you think they are going to sign off their personal reputation easily? As opposed to a nameless NHBC inspector who turns up twice on site? There are valid reasons why an architects certificate is more suited in some cases than NHBC who often won't touch anything out of the ordinary.

As for the story of the slate falling off then yes there may well be more chance of a architect having a word with the builder and sending them round even if it isn't covered in under their certificate! You are talking about people who know each other and have worked with each other, not a faceless organisation like the NHBC.