Mortgage offer expires before property is completed. Where do we go from here?

danhenshy23

I am wondering if anyone with professional or personal experience of new build property purchases can advise on the predicament which I have found myself in regarding our mortgage offer.


Starting from the start, in September my partner and I placed a £750 reservation fee on a New Build property which is to be built by property developer Bellway Homes.
When reserving the property, we were made aware that the estimated completion date is to be May/June 2014 due to it being a few build phases down the line.

During this meeting with Bellway, we signed documentation which stated that the plot was reserved until 22/11/13 and were given clear instruction that we were to ensure that both our mortgage and deposit were in place by this date.

On the same day Bellway put us in touch with The New Homes Group (TNHG) who arranged for an Independent Mortgage Advisor to come and visit us at home.
During this consultation, we opted to apply for a mortgage with Nationwide, which carried set-up fees totalling £379.
We also signed up for TNHG’s Lifetime Membership, at a cost of £395, which meant they would handle all of the paper work for the mortgage and Help to Buy application processes as well as other benefits in the future.


Last week we received news that our mortgage application had been successful and yesterday we received a copy of the offer from Nationwide through the post.

It is at this point that our problem begins. The letter stated that our mortgage offer would expire on 29th April 2014, a date which is before the estimated completion of the property (May/June 2014).
The letter also clearly states that this offer is not extendable and if the sale is not completed by the expiry date, then the mortgage will be cancelled.


I called TNHG who advised that mortgage offers will only ever remain valid for 6 months and the only solution would be to re-apply for another mortgage when we are within 6 months of the property being completed.
As this would be a new mortgage application, the initial set-up and valuation fees would need to be paid, a cost that TNHG have said we would be accountable for.
When I challenged this I was referred to Bellway to take the matter up with them.


I have called Bellway and explained the situation I am in. They have escalated the matter and have advised they will be in touch shortly.




My question is, who is in the wrong here?


Since visiting Bellway and making our reservation, we have followed the advice which we were given and have ensured that there has been no delay on our part when making sure everything was in place for the reservation deadline on 22/11/13.


Are Bellway in the wrong for pushing to have the contracts signed and deposit paid by a date which is more than 6 months from the date of completion?
Surely as a major property developer they should be aware of something as basic as this?


Are TNHG in the wrong for helping us to apply for our mortgage whilst being aware that the offer was always going to expire before the property was even built? After all, these are the guys we were put in direct contact with through Bellway.
We have effectively paid for flawed financial advice from these people.

With the current surge in new-build properties across the country, which has only been fuelled further with the introduction of the Help to Buy scheme, I find it very unlikely that we are the only ones to have experienced a situation like this.
As the scheme gains popularity, surely more and more planned properties are having completion dates in excess of 6 months.



I honestly feel that we have been set up to fail on this and have been very ill advised along the way. As a result we have been approved for a mortgage which we will never be able to use and have no idea where we go from here.


Any advice that anyone could give, really would be much appreciated.

Regards,
Dan