Seller's are being repossessed

honey_badger_3

Hello

I am a FTB who is in a long, painful process of buying a house.

The purchase started 1st August...so 6 months ago. While viewing the house we were told by the EA that the couple had split and were under threat from repossession unless they could find a quick buyer...they were burying their heads in the sand and had stopped paying the mortgage.

So my partner and I made a series of offers.

The painful process started it took 8 weeks for them to complete the sellers pack, we were constantly chasing the EA to chase them to see what was happening. One of the party refused to sign the fixtures and fittings forms and for 1 week it was game over and the EA told them that they weren't representing them anymore after all of the hassle. And we started looking for other houses.

We should prob have walked away then but the form got signed and the sale was back on. Our sols completed their end of the searches then their solicitor said that there was no point in answering the Q's in relation to the searches and they were waiting for the bank to accept our offer!!!

We then found out that they were in the middle of repossession (which their sol's had kept quiet on). So our sol spoke to the mortgage people at their end and managed to stop the repossession - the bank then had to decide between accepting our offer and giving them a loan to cover the short fall on their mortgage (our offer was approx £50k below what they paid for the house in the boom - their asking price was well below what they bought the house for also, so they expected a shortfall) or the other option was to finish repossession and then we'd have to wait to see if the bank got better offers before accepting our offer.

So after waiting all Xmas they accepted the offer and gave them the loans. BUT it is now 2 weeks after the loan Ts & Cs were issued and they are yet to sign on the dotted line.

Does anyone know how long a bank may halt a repossession for in this kind of situation?

We are looking at other houses again but hoping that this nightmare is resolved. We'd have given up by now but keep getting glimmers of hope that are keeping us with it.

G_M

There is no way of nowing.

The longer the delay, the greater the extra loan the sellers will need from the bank and the more reluctant the bank will be.

At some point they will cut their losses, repossess, and go for a quick sale.

Tomorrow? Next week? 3 more weeks........?

honey_badger_3

Its been 4 weeks now and touch wood the final piece of paperwork has just been completed, no sign of the bank..yet. Hopefully we can exchange soon once we've seen and checked the search report

honey_badger_3

Search report checked. Checked the property and although its vacant possession there has clearly been a party in it, crisps, red wine and cigarette ash everywhere...yes its their property but concerns starting to come regards condition of the place. Kitchen also has a leak from bathroom above too! EA is raising issues with seller. We're talking to our sol about it all.
Then to add to it all we find out today that'negative equity team' is going to re-valuate the property and either accept our offer or repossess them and put property on open market again.
Many people are saying walk away but we're going to stick it out as there's nothing else coming on the market at the moment that interests us.
Has anyone else encountered this?

Thrugelmir

As the property is in negative equity. The lender is obliged to recover as much of the debt as possible. As the borrowers remain liable for the deficit. So the bank has to evaluate whether your offer is reasonable. In order to cover it's own back.

If there's no viable alternatives. You might as well run with it to conclusion. Any concerns regarding the property you have should be addressed by inspecting the property again prior to exchange of contracts.

LisaLou1982

Ive seen this before when i was an EA.

Sadly some sellers just dont care once they get to this stage, so id be surprised if they were looking after the property as if it were still their own. In their mind, its going to be repossessed anyway so they probably couldnt care less.

If it gets repossessed, expect it to be a few weeks before it comes back on the market. Hopefully when it does, the EA who takes the repossession will call the agent you are buying through and let them know. If theyre any good they would anyway. That was always my first port of call.

Fingers crossed that the lender would then proceed with you as a preferred buyer as you already have completed some of the legal process prior to repo.

The lender does have a responsibility to get the most money they can for the property, but they also have a responsibility to get the most reliable and fast moving buyer too.

Good luck x

honey_badger_3

This is a very slow process - we're still waiting for something to happen. Hopefully it wont be long until a decision is made either way - repo or we buy. Chasing up the EA today to find out if the second valuation (for the negative equity team) has been done by an independent EA.

Our mortgage provider has done a valuation on the property also, to check it's value as our mortgage offer expired and we needed to arrange a new one. They have said it is worth that amount of money.

The crazy thing in the current twist to the tale is that the seller is with the same mortgage provider as us, so it will be interesting if the other valuation comes back as it being worth more. Due to there being a conflict of interest the provider can't access either valuation.

Totally understand that this process needs to occur as there's a very large shortfall at stake - just wish it would conclude soon so we can either move in or find somewhere else to buy.

Thanks for your feedback x

silvercar

If the seller's have moved out then they have given up on the property. So forget about the seller being given loans. Either the lender will repossess quickly and sell to you or put on open market.

It may hinge on whether the seller is prepared to sign a voluntary repossession form with the lender. Without that the lenders will need to go to court to repossess which could add weeks to your timescale.

andy.m_2

Our first house and our current house were bought from people either being repo'd or right down to the wire.
Both sales went through so there's hope for you!

In both cases, I will be polite and simply say that we needed to get a jolly good clean done before moving in.

To be fair both houses represented terrific value for us, although I promise you we did not look out for repo places and they do bring extra hassles and worry.

To be fair there isn't much you can do to affect the process save sign and return any forms to your conveyencer ASAP so try not to worry and let the process take it's natural course.

Tassotti

If it all does go through and no othre parties are interested, I'd be tempted to reduce my offer, as it's a repo.

honey_badger_3

There's no way I'd consider lowering the offer as there is already a £60k shortfall if they wont accept our offer now they wont after repo - as the bank would indicate via repo'ing them that our offer isn't good enough.

The bank loans have been offered to them - just waiting for the bank to confirm that they are happy with our price and the (unsecured) loans issued to them.

If the banks not happy with the independent valuation they will repo, if they are happy with it they will take our money and give them loans to meet the short fall.

Our solicitor is very hopeful that the sale will go through without repossession, as he thinks that the cost of repo will be more than the extra money they will make by putting the house back on the market (the house was sold for more than its value a few years ago - very dodgy deal within the sellers family)

Fingers crossed we get sorted soon