Chain Breaker Company

strawberry1973

We are in the process of trying to buy a house which has a chain breaker company involved, this company are handling the sale for the vendor using power of attorney. We had eventually made it through the process up to signing the deeds and the mortgage offer, when this came to our solicitors attention, which then meant she had to notify our mortgage provider Leeds of the "structure of the sale". Leeds promptly withdrew our mortgage offer saying they do not deal with "back to back" sales (which this is not according to the mortgage broker and solicitor). The company handling the house sale is Quick move properties. I guess my question is, are there ANY mortgages who deal with these type of purchases, and any advise of what to do next. Help

kingstreet

Who owns the property?

The definition of a back to back is a change of proprietor within the last six months. If there's been no change, it should not be treated as if there has...

kingstreet

FWIW, here's Halifax criteria on the issue;-

A back-to-back transaction is a type of sub-sale where the intervening seller buys from the original seller and sells on to the borrower on the same day or within a few days. We also regard as sub-sales, cases where the seller acquires the freehold (or superior leasehold) title to the property, which they then immediately sell on to the borrower by the grant to them of a lease (or sub-lease).

The following cases are exceptions where it is acceptable for the property to be sold on within six months of acquisition by the seller.

Where sales are by:

A personal representative of the registered proprietor; or
An institutional mortgagee exercising its power of sale; or
A receiver, trustee-in-bankruptcy or liquidator; or
A developer or builder selling a property acquired under a part-exchange scheme.

Applications which involve assignable contracts or irrevocable powers of attorney in favour of intervening sellers are not acceptable. Any other structure to the transaction which has a similar effect should be reported to us.

You appear to be falling-foul of the bold section.

strawberry1973

Thanks, the man who has lived there for 50 years,still owns the house,the company are just using power of attorney to stop him selling the house because i believe they have arranged his sheltered flat he moved to (i assume they did)
So looking at your second email, we may well be falling into that section. I assume all lenders willhave the same outlook.

strawberry1973

Who should have informed us of this when we first made an offer on the house? We have spent a lot of money on surveys and solicitors already which as you know can not be refunded, on a house we can not buy.

kingstreet

It's such an unusual situation, it's very difficult to know who should have raised the issue.

I suggest you speak to an independent or whole market broker for a lender which may assist in this situation. There are a few who don't apply the "six month rule" and may be willing to lend.

strawberry1973

Thank you for you advise, we are using a whole market adviser and he is now researching to see who will lend. He was not aware at the outset of the structure so he simply found us the best suited deal etc

anyway thanks again